Another great piece from Chuck:
The only Chevrolet dealer in Smallburg, Texas, augments his local newspaper ads with a schedule on a regional radio station licensed to the adjacent community, Midville. He's been selling an average of 18-20 cars per month. At the end of his first month with the new radio station he has sold a total of 27.
In his next newsletter the station manger writes, “When you see Ned Vanderslice of Vanderslice Auto, ask him why he's grinning. He'll tell you sales are up 30 percent.”
The newsletter hits the mail. Within hours the manager receives an angry phone call from Vanderslice. “How DARE you claim my success?”
“Ned,” asks the manager, “other than advertising on my radio station, what other changes did you make last month in your advertising? Did you run any additional newspaper? Any additional television? Any additional direct mail?”
“No,” says Ned, “but you had nothing to do with my sales increase. Nobody drove from Midville to buy cars from me.”
Ned thinks advertising cause and effect is common sense.
Is it? Yeah. Most of the time it is.
In this case, I'd bet that Midville's regional radio station has listeners in Smallburg. How many? At least seven. At least seven that were ready to buy new cars. Since no other part of the advertising mix has changed, we can pretty well determine what drove the increase.
The key is to test only one change at a time.
Then watch the outcome. Sometimes it's not what anyone might expect, but it's usually still common sense.
An apartment complex which does a very credible job of tracking the source of each lead has just added radio ads to their marketing mix. I advised them to watch for an increase in ALL of their lead sources.
1.Realtors, hearing the ad, will naturally think of this complex more often. We can expect them to recommend it more than they might have without the reminder.
2.People hearing the ad are likely to look up the phone number of the complex in the Yellow Pages. We can expect Yellow Pages referrals to increase.
3.People keying the name of the complex into Google will, of course, drive up the on line referrals. But common sense will tell you there was only one change in the marketing mix.
My favorite advertisers intuitively know this. They change headlines, and record the response. They change insertion days, and record the response. They add the weekend edition, and record the response.
Roger de la Paz of Richie's Real American Diner in Victorville, California knows that this particular ad delivers a consistently predictable 118 percent increase in gross sales every day it runs.
How? Because he's already tested everything from ad size, to offer, to headline, to graphics, to the day of the week to run this ad in the Victorville, Ca. Daily Press. Roger systematically changed only one element at a time, and kept careful records of each outcome. He compares the demand for specific food items before the ad runs, and again afterward. He is then able to calculate the increased demand for specific menu items against the cost of the ads.
There are no quick answers. Each test helped Roger to make each successive ad more profitable. It took him three years to learn what he now knows about advertising his restaurant in the Daily Press.
But by carefully tracking the specifics of size, placement, and frequency of his newspaper ads, Roger can now predict to within a few dollars the ROI for each newspaper ad he runs for Richie's Real American Diner.
Persistence, it appears, is also a key element in testing your advertising.
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Chuck McKay is a marketing consultant who helps customers discover, and choose your business. Questions about testing your advertising may be directed to ChuckMcKay@ChuckMcKayOnLine.
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