"Advertising doesn’t cost, it pays!" I would bet a few dollars that you have heard this expression before. What it intends to convey is that there is a return on investment (ROI) in advertising. Your advertising budget should eventually return to you, hopefully multiplied, as revenue from sales. I like this saying because it reminds us to take the long view of why we are spending money on marketing and advertising to begin with, but I think that it glosses over a central truth: The RIGHT advertising pays. Poorly conceived or sloppily executed advertising can cost dearly. The best possible result is that your efforts are ignored in the marketplace and ultimately wasted. Truly terrible advertising can damage your brand.
Whether you are in search of a new advertising campaign, or looking to evaluate whether your existing advertising is doing enough, market research can de-mystify the habits of your target market and help you decide on a strategy that is most likely to succeed.
Here is how market research can assist you in your advertising decisions:
- Identifying your customers – Who is your target customer? How do they consume information and media? Where do they shop? Do they commute? Details about the habits of your customers can help you to focus your advertising efforts and develop your message. The more you know about and understand your customers, the more directly you can speak to them in your advertising and address their unique needs and concerns.
- Narrowing down the options – Once you know who your likely customers are, you have to determine how to reach them. Market research can show you what channels of advertising reach customers like yours, and which are the most effective. This can help you to compare costs and determine how you are likely to get the biggest impact per dollar spent. If your customers are twenty-somethings that spend a lot of time online and have largely cut the cable cord, television commercials are going to be ineffective. So how do you reach them without taking a shotgun approach to social media and other channels? Seeing what the market research says are your best two or three bets. Advertising often works best if you can reach the same customer through more than one channel. Imagine driving down the highway and hearing a radio ad and then a few miles down the road seeing a billboard for the same company. You would undoubtedly take notice.
- Setting a schedule – How often will your ads run? For how many months? How many times a year will you send direct mail? What is the saturation point at which your customer starts trashing coupons without even glancing at them? In addition to deciding how to advertise, it is critical to be intentional about how often you advertise, and at what times during the year. Knowing which holidays bring people into stores, or when most people start planning their vacations will help you take advantage of natural momentum instead of fighting against human nature and the public’s expectations.
- Steering around your competitors – What are your competitors selling, and how are they advertising? Understanding your competitors’ strategies will help you plot a course around, or even through them. It can also help you identify your product’s relative strengths, and create a brand message that overcomes or capitalizes on any weaknesses that your competitors may be highlighting. Market research can help you to periodically evaluate your product offering and your advertising from an outside perspective, and help you determine if there are opportunities to improve, or ways to tap into new customer segments.
Advertising campaigns are a great way to reach new customers, and when done well, they can generate great returns through new sales and creating a lasting reputation for your company and brand. Each budgeted dollar in your marketing and advertising budget should be laser-targeted to reach your customers in a positive way, and make the most cost-effective impact. Understanding your customers, competitors, and the landscape of your current or prospective market through market research will help you create a winning advertising strategy.