Small Business: Advertising – Dominic Sutton, Pumpt Advertising
Dominic Sutton, director of Pumpt Advertising in Auckland.
Can you tell me a bit about your business?
Pumpt Advertising started in 2003 with my last paycheck. Initially, we started offering direct mail solutions, but over time the offering has grown even further. Basically now we offer a suite of integrated advertising solutions, primarily for retailers. We have 13 employees.
What is your advertising budget?
We have a well-defined target customer base – multi-store retailers and franchise groups – and then we have a selection of other customers who, while not our primary market, also value our service. In order to effectively reach these people, we need to be fairly concise. We would spend about $ 3,000 per month on promotion on average, on a number of services.
Where are you spending this budget and why did you choose these particular channels?
Our best results come from a direct approach, which is fairly standard in the business-to-business channel, i.e. through our own salespeople, and through direct mail. We also use Google AdWords; vehicle signage, because we have seven cars on the road; and we occasionally publish a flyer or advertisement via an industry publication.
How to measure the effectiveness of your advertising?
Leads and sales come from a variety of sources for us, and it’s hard to keep track of everything. We try to follow our own advice and have our own formula for success, which is that for any new income we are willing to spend 10%, or 10 cents on the dollar, to attract it. It would vary depending on what business you’re in, so whether that sounds high or low to you, it might just boil down to the kind of gross profit you make on any new income with an existing business structure.
Finally, you advertise and help other small business owners make decisions about their advertising spending. What are your three key tips for getting the most out of your advertising dollars?
1. Always start with your target. Who are you targeting? Where do they live? What are their demographics? Once you understand this, you can select your media. Many small businesses do it the other way around, so, for example, they like a radio station, so they will advertise there, even if that radio station doesn’t even appeal to their business’s target audience.
2. Define ROI in terms of results, not percentages. A stated result in sales value is much better than a percentage response rate. Think of 50,000 flyers delivered by two companies – one sells pizza, the other sells houses. If you quantify the result as a percentage, there are vast implications for the results.
3. Be organized and avoid having too many decision makers. We have a lot of small businesses where artwork is checked by just about everyone in the client’s office, most of whom were not involved in the original brief. Make a plan, call in the experts, and let them do it. More changes means more delays, more costs, and ultimately key events missing from your promotional calendar.
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