Rules Of Advertising

Years ago, John Wannamaker, founder of the nation's department-store industry, lamented, Half my advertising dollars work, I just don't know which half! This new column in Ward's Dealer Business is to improve on that ratio that, alas, often persists to this day. I want to help you make all your advertising dollars work. But that's not going to be easy. Car advertising and dealer advertising is the

Years ago, John Wannamaker, founder of the nation's department-store industry, lamented, “Half my advertising dollars work, I just don't know which half!”

This new column in Ward's Dealer Business is to improve on that ratio that, alas, often persists to this day. I want to help you make all your advertising dollars work. But that's not going to be easy.

Car advertising and dealer advertising is the biggest category of ad sales in every form of paid consumer communications — newspaper, magazine, television, radio, outdoor, direct mail, Internet, sky writing, whatever. It's nearly a $9 billion dollar industry.

Yet, while most dealers have increased ad spending over the past decade, the percentage allocation to specific media has virtually remained unchanged. That's inconceivable.

Everything in your business has changed dramatically, except the advertising!

The vehicles are not the same. Trucks are bigger than anyone could possibly imagine. Without computers you'd be out of business. F&I has been dramatically revised. The showroom, sales and service areas probably look different.

The customer has changed. Customer service is no longer an oxymoron. So much has changed. Except ad budget allocations. They're about the same split as a decade ago.

It's time to review, analyze and scrutinize every element in your advertising budget.

Let's start with newspaper advertising, both display and classified. It's typically 50% to 55% of a dealer's ad budget. Now. I'm not picking on newspapers. Over time, I'll be posing equally tough questions for the other ad media.

But here are questions you need answered in order to make informed decisions about newspaper advertising in your market:

  • What percentage of your budget is spent in newspapers?
  • Percent in classified? Percent in display?
  • What frequency of ads per week does this represent?
  • Does the number of ads remain the same or vary by selling periods?
  • Can you track the number of prospects in the store per ad?
  • Can you track the number of sales per ad?
  • Has the paper's circulation grown or shrunk in the last two years?
  • What coverage does the paper get within a 5-mile radius of your store?
  • Are car advertisers supported with automotive editorial?
  • How much does it cost to produce the average ad?
  • What's the ratio between production and media cost?
  • What is the cost of newspaper advertising per car sold?

There are more questions that could be asked, but these will come to you as you scrutinize, analyze and review your newspaper ad budgets.

I'd welcome any questions, comments or contributions you may have about your store's advertising programs, ads, budgets, media expenditures, style, logo, and creative executions. The purpose is simple: to make dealer advertising more effective, efficient and exciting.

Top Salesman's Offbeat Mailers Are Funny — and 90% Effective!

CRM (customer relationship management) is a new buzz word. But in my opinion, the better term is customer relationship marketing. Selling cars is a personal sales business that needs personality and a personal touch more than computer software programs. Case in point:

Just six years ago Bob Krarup started selling cars at Fagan Chevrolet and Cadillac in Janesville, WI. He's become a top salesman in that time. For three of the six years, Krarup has been the dealership's salesman of the year.

How's he do it? Part of his success has been an offbeat customer relationship marketing program he developed that uses specially created post card mailers.

These clever, irreverent but relevant mailers use special photos combined with amusing, copy to convey some strong messages: 1) Krarup is pleasant and easy going, 2) is not going to take advantage of you, and 3) he'll be fun to work with.

The post cards cost about $800 to create and print and are mailed to Krarup's own 1,200 household mailing list three times a year. About 80% of the people on the list have bought cars from him, 20% are prospects. The dealership shares part of the costs of the mailers.

Krarup says, “From the very first post card I sent out, the program has more than paid for itself. When they come in with my mailers in their hands and ask for me I know it's working.”

Marty Bernstein is a former ad man and current auto journalist specializing in marketing and advertising. He's at [email protected], and welcomes questions and comments.

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