Friday, February 7, 2014

Advertising for SMEs – A useful tool.

The world is no more round, it is turning flat; in simple words, competition that was restricted to your own country or may be a few neighbors, has exploded to include the world. India has suddenly been thrown into the limelight and become the world’s outsourcing poster boy. Everyone wants to work with India in one way or the other. Future super power or something else, India is on the upward curve. All the more reason why you should be looking at advertising seriously.

But what is the need for advertising? 

Advertising is a necessity because of competition, because the market is limited but the players are many; because advertising brings in more prospects, advertising helps to build your brand, create the right impressions and attitudes towards your product in the mind of the consumer.

However, the success of advertising depends a lot on planning in advance – not just what you should be talking about in ads, but also when to talk, where to talk and whom to talk to – which means, the message, the time and the media should be planned well in advance. Why? There is a simple reason: to ensure you get more value from your ad spend!  Having an advertising plan (Ad Plan) in place is a good way to begin.

Simple questions to ask yourself when you work on an Ad Plan.

  • Why do I want to advertise?
  • What is the annual budget I have for this activity? 
  • Who is my target audience for the advertising?
  • What do I want to achieve through this advertising?
  • What media best suits my purpose? 
  • What is the competition doing in terms of advertising? 
  • Is it successful? If yes how? 
  • Is it a failure? Then why and how?

Have an annual budget 
Having an annual budget earmarked for advertising is worth the initial effort.  But what your budget should be depends entirely on what you want achieve. It might be a good idea to begin with a fixed percentage of your total annual revenue as your ad budget.
Typically, companies earmark anything between 2% to 10% of their revenues as their advertising budget. The bigger ones go for the bigger spends and the smaller ones prefer something that suits their pocket size. There is nothing hard and fast about it though and you could begin with something even less than 2%. The key is to begin and stay put. Advertising is about being consistent without expecting overnight magic in sales figures.

Study competition that is more successful than you
Imitation is the best form of flattery, as goes the saying. First know your closest competition and then study them in detail. Then study how they advertise and see the results of the campaign. It may do you a lot of good to initially follow and work on some tips from the competition’s ad strategy and see if they will work well for you. As you get comfortable with the whole process of advertising, you can develop your own, solid Ad Plan.

Have a company as your gold standard 
Among competition, identify one company/brand as your benchmark, your gold standard. This is the company you want to be/or reach. Also plan for the right time to reach your goal and the how you plan to reach it.

Set realistic goals
There cannot be anything as important as the ‘Setting of Goals’ in your Ad Plan. A goal has to be specific, measurable, achievable, reviewable and bound by time. Only if you set goals, can you compare if you have reached those or you haven’t. After a certain period, a review is essential. Analyze and see if you are on the right track to your goals; if not, do a course correction.

One trap that one tends to fall in, when one says ‘goals’ is the ‘sales growth’. That is the ultimate aim, no doubt, in fact, the ultimate goal really is ‘increasing profits’ and not just ‘sales’; but there are many others on the goal list. Example – increasing brand awareness, increasing brand visibility, improving recall, inducing trial, giving out information (example when a company merges with another and a new entity is formed, or when a company changes its name, or when a company has an IPO coming up and so on). In any of these cases, the goal has to be specific, for example, “We want to increase brand awareness by 10% all over India”. The more specific the goal, the more accurately you can measure the ROI on your ad spend and ensure better results eventually.

What advertising cannot do
Advertising is there to promote your product/brand/company/event. Advertising cannot, however, improve your product – it cannot improve your product features or its functioning or its after-sales support. It cannot stop the product from mal- functioning. For example, if you buy a washing machine after reading an ad, and the washing machine goes kaput in 6 months, you are most certainly not going to blame advertising for its failure to deliver! Or, when advertising gets people to a car showroom, but the sales guys there are not trained well, that again is not advertising’s fault. For great advertising to work, you ought to have a great product that delivers to its promise, consistently, year after year!

Usually many companies expect too much out of advertising without knowing what they are doing it for! That’s the trap one must avoid.

Action is critical 
Once your goals are set and the ad plan is formulated, action is advisable. If things work, that’s what we wanted. If they don’t, roll up your sleeves and get back to the goal resetting. A simple way of getting into action is breaking your annual ad plan into small, easy-to-digest tasks. This is done by making a month-wise event calendar for the year. By events, we don’t always mean events, they are actually the tasks or activities under advertising that you need to do in that particular month. An annual advertising plan can overwhelm a beginner; by working out an event calendar, life becomes simpler and you can breathe easy.

Where should you go with your advertising? And how to avoid media mania 
Media mania is about people wanting to go all over the media –in newspapers, TV, radio, hoardings, social media – everywhere. But one needs to control this sudden media lust and go only where you will find your audience. The trick is to identify your Target Audience very clearly and then find out what places he visits, what he reads, what channels he watches on TV and which radio channel he listens to. Then go where you find your customer. This way you plan your ad budget well, save on unnecessary spends and get the most out of your advertising rupee. For example – an automotive parts supplier should ensure he is ‘seen’ by his customers – so he should target the auto belts of the region. He should see what the decision makers do, read and watch. And should go there with his advertising.

Reviews are important – monthly, quarterly and annual 
Reviewing an Ad Plan is extremely important. It can be done on a monthly, quarterly, 6-monthly or an annual basis. Review the Ad Plan with your team members and the ad agency if you have engaged one.
If budget permits, you may even want to explore the idea of hiring your own advertising or marketing communications consultant.

Internal advertising should not be ignored 
Along with an external advertising plan, it is also important to focus on internal communication to motivate your employees as they are your best brand champions. Internal communication could be in the form of an HR training manual, posters, contests, internal celebration of important events, etc.

Grow your network
Networking is now more than just a buzzword. It has the potential to keep your cash register buzzing. Growing your network, both real and virtual, can make that big difference to your business. It can help you generate good word-of-mouth at a much lesser cost. This takes us to digital advertising or digital communication, which has assumed a key role in promotions. More on the subject later.

Keep advertising. Keep growing.
The best time to begin advertising is anytime now. Start small so you can grow big. Increase your spends gradually. You don’t have to have a budget of crores at the outset. Start small, grow steadily, advertise big.
But before you do all of this, start working on your advertising plan.

Happy Advertising!