I was talking to an owner the other day. He is, in my opinion, one of the smarter owners in this industry. He’s been around for a while, tried a lot of different things, has a pretty good understanding of his business and this industry, stays informed, and is always willing to learn.
What surprised me is that, even today, he is still making some of the same basic mistakes that many of the dumber owners and managers I know are making when it comes to his marketing.
When I though about why this is the case (I knew he was smarter than what he was doing would suggest) it occurred to me that most of the marketing activities available to owners and managers today are dumb.
Think about it… direct mail is going to get you a 1%-2% response rate if you do it well. So 10,000 direct mail pieces will get you 100-200 responses… not sales… responses. Of those you might get 10%-25% to eventually commit to a sale… so that’s 10-50 new members… if all goes well. And those new members have to stay for several months before you even recover your return on your marketing spend…
Pretty dumb.
Newspaper ads can cost hundreds or thousands of dollars but they are here today and gone tomorrow and the results are hit and miss but usually more miss than hit… you might get as low as half a dozen or a dozen responses and sign up 25%-50% of those if you do a good job.
Newspaper inserts are cheaper but are still hit and miss...
Pretty dumb.
TV ads are expensive and also unreliable and most clubs’ budgets prohibit the kind of expenditure required to get it right over time.
Pretty dumb.
Discount/Gift cards are all the rage at the moment and can increase your response rate up to 5%-10% (again not sales but responses… maybe 25%-50% of those join up) depending on the size of the discount and a few other factors but of course the dollar amount of the gift card goes directly onto your acquisition costs.
Smarter than traditional deep discounting offers (because it can be more targeted)… but still pretty dumb.
Lead boxes used to be a reasonable, and inexpensive, guerrilla marketing tactic in the past but they have declined in popularity as their effectiveness has declined over recent years...
Dumb, dumb, dumb…
So smart owners and managers do dumb things because the “things” (advertising and marketing tactics) they have at their disposal are dumb… and let’s face it we have to do something. It’s the reason that most marketing plans aren’t worth the paper they are written on.
When it comes to marketing most owners and managers are simply doing the best the can from a bunch of bad choices… not to mention consultants telling them to try everything.
If traditional marketing is dumb what is smart? Of course, we believe that iPOS is the smartest thing you can do for your marketing right now… read the Free Preview and make up your own mind.
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