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Rule 2 Of 7 Rules To A Successful Print Advertising Campaign
(Article first published in Oct '07. It has been modified slightly to suit its publication on our site)
This month I will discuss the second most important rule of advertising and when you learn how to implement it effectively you'll be amazed at the difference it will make to your sales:
DON'T Discount - ADD Value!
In the last article I outlined how important it is to run adverts that actually offer an incentive for the reader to take action very quickly, otherwise human nature and busy lives get in the way and your advert will be quickly forgotten. However most people immediately think that an offer should be a percentage discount.
That could be the right strategy if you're a mass merchant or a provider of budget products or services, but what if you want to be seen as an exclusive restaurant or provider of high-quality clothes or furniture? Discounting in this case can undermine your branding efforts and whereas it might bring you some short-term return it could also harm your long-term success.
A better approach is to add value, this not only helps to cement the status of your brand, but it is also a far more cost-effective way of bringing customers to your business. To illustrate this point let's imagine business man A and business woman B both sell an item for €100 and their cost is €75. That means they both make a respectable 33% margin. Business man A decides to run a 10% off promotion, which means that he now sells the item for €90, reducing his percentage margin to 20%. Business woman B on the other hand decides that she is going to add value and finds an accessory item that she normally sells for €15, but only costs her €5. She promotes this value-add deal, which allows her to continue to sell at €100 and although her cost increases by €5 to €80, she is able to maintain a higher margin at 25%. The bottom line is that her business is perceived as the place where you get more for your money and she maintains a decent margin throughout. So, whatever your business involves, find something that has value to your customers but costs you very little and has some tie-in to the main product you are selling.
Another option if you don't have a low-cost item to attach to your deal is to simply be more creative with how you structure your offers. Supermarkets could easily give 50% off certain items, but isn't it more appealing when they say "2 for 1" or "Buy One Get One Free"? You can even run a "3 for 2" campaign, which is basically a better way of saying 33% off.
The final point to think about is why you want to run these offers in the first place. Are you looking to make short-term revenue and margin or build a long-term loyal customer base? If it's the latter you might want to consider a high-value offer that is guaranteed to bring customers to your store, but that may dramatically impact on, if not wipe out, your margin. However if you prepared properly for this it could help build a large and loyal customer base.
Addendum (Added in Feb 2009)
It should be noted that the above is extremely effective during times of financial stability. However, during times of recession (when consumers' minds are focused on saving money) and especially where surrounding businesses and/or competitiors are running heavily discounting related promotions; running value-add campaigns may not deliver the return you might otherwise expect and so you may be forced to join the crowd and run pure discounting-based offers.
The next question most people have is "how do I know if running these offer-based ads is working for me?" This is the topic of my next article next month when I discuss Rule 3: Make Sure You Are MAKING Money From Your Ads. But if you can't wait that long or have an urgent question please contact me on the telephone number or email shown below.
Franco De Bonis has worked in the field of sales and marketing promotion since 1990 and was most recently the global marketing manager for a major international technology company before setting up DG Group in January 2007.
DG Group is dedicated to delivering all the marketing solutions any company may require. Whether it's a website or leaflets and brochures, or even some product packaging; DG Group will manage the whole project and even provide guidance along the way.
The content in this section is the original creation of DG Group and is protected by copyright. You may use this content on your site or in other materials providing you acknowledge DG Group as the author and include a link our site.
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