The Role of Local Marketing
In my job (radio advertising sales mgr) I have conversations with small business owners who are excited about marketing and growing their enterprises. One interesting aspect of doing this is learning about the expectations business owners have of their advertising. As a general rule, small business owners are wildly optimistic about what advertising will do for them. They overestimate the impact that a small investment will make and they don't want to believe that immediate and sustained results are unlikely when they are unable or unwilling to commit dollars to a regular and extended campaign.
The role of local advertising is to take advantage of consumer behavior - not to change it. Restaurant owners in particular seem to be particularly interested in changing the normal behavior of consumers. Most restaurants are slowest on Mondays and Tuesdays and busiest on Fridays and Saturdays. That is because most people who go out to eat do so on Friday and Saturday. Everybody knows that! But, without fail, every restaurant owner will ask a local radio station, TV station, or newspaper to come up with a plan to increase their early week business. They reason that because they are full on Friday and Saturday their best chance to increase revenue is by propping up the early week. Sensing that the prospect will spend money with them if they come up with a strong idea, most media sellers will entertain this plan. After about two weeks of running early week advertising and failing to move the needle, the restaurant owner will cancel the remaining advertising and declare the medium a total failure. That's why the next seller in the door will hear:
"I tried <insert medium> and it didn't work."
Restaurant owners who use local media should be giving consumers a reason to come to their restaurants and then let the consumers come when they want. Does this mean that most people will respond to the advertising by coming out on Friday and Saturday? YES! The smart restaurant owner will prepare for that by:
- making any wait time as entertaining as possible.
- providing bounceback coupons on Friday and Saturday nights that are good on Monday and Tuesday only
- maximizing the number of workers scheduled for weekends during which advertising is running
- making sure that they are out on the floor and not stuck in the kitchen so that they can work the crowd.
You might be thinking that there are people who go out to eat on Monday and Tuesday and that a restaurant advertising on those days could reasonably expect to draw more people than if they didn't advertise. That is true but in general the additional people one draws on Monday and/or Tuesday would not be worth the cost of advertising. The bottom line is that if the sum of Monday and Tuesday revenues are 15% of your total week's revenue before you start advertising, they'll probably be the same % after the campaign is over. The advertising should increase overall revenue and the owner shouldn't worry about redistributing the %'s.
Local advertisers just don't have the muscle to get folks to change behaviors and they waste their money when they try anyway.
Advertising sales people don't like to hear it but automobile dealers have a keen understanding of when to be in the market and when not to be. Right now, automotive advertising on a local level is way down because car sales are way down nationally. All over the country, local advertising sellers are pleading with auto dealers to gain "share of voice" or "share of mind" or "share of market" by advertising when the competition is not advertising. The reasoning goes like this:
"If you advertise now while the competition is idle you will gain additional share immediately. When the auto market turns around and demand is high, the additional share will be well worth the investment we are asking you to make."
This plea falls (correctly) on deaf ears. Auto dealers must measure the cost of the advertising against the return they are likely to get right now and not on some future share. The reason is simple: A very small percentage of the public is in the market for a car (maybe 3% under normal circumstances and 2% right now). Consumers only hear the advertising that pertains to them. So, any market share gains made by a local auto dealer are being made with the 2% of people who are "now" buyers of autos. These now buyers will not be in the market again for another three years so the advertising seller is asking the auto dealer to spend money with them to 1) gain market share of an unusually small pie and 2) wait three years to get a payoff on that growth in share.
Having dry powder to work with when demand returns is a much better strategy and most auto dealers know it.
This is not to say that businesses shouldn't be trying to influence the behavior of the local consumer! Essentially they should be saying:
"If you're a coffee drinker then you should drink your coffee here because of x, y and z."
instead of
"If you're a tea drinker you should consider coffee because of x, y and z and when you do change from tea to coffee you should buy it at our place."
Remember, to advertise effectively at the local level, find out how consumers are behaving and then fashion your message to take advantage of their direction and momentum.
The role of local advertising is to take advantage of consumer behavior - not to change it. Restaurant owners in particular seem to be particularly interested in changing the normal behavior of consumers. Most restaurants are slowest on Mondays and Tuesdays and busiest on Fridays and Saturdays. That is because most people who go out to eat do so on Friday and Saturday. Everybody knows that! But, without fail, every restaurant owner will ask a local radio station, TV station, or newspaper to come up with a plan to increase their early week business. They reason that because they are full on Friday and Saturday their best chance to increase revenue is by propping up the early week. Sensing that the prospect will spend money with them if they come up with a strong idea, most media sellers will entertain this plan. After about two weeks of running early week advertising and failing to move the needle, the restaurant owner will cancel the remaining advertising and declare the medium a total failure. That's why the next seller in the door will hear:
"I tried <insert medium> and it didn't work."
Restaurant owners who use local media should be giving consumers a reason to come to their restaurants and then let the consumers come when they want. Does this mean that most people will respond to the advertising by coming out on Friday and Saturday? YES! The smart restaurant owner will prepare for that by:
- making any wait time as entertaining as possible.
- providing bounceback coupons on Friday and Saturday nights that are good on Monday and Tuesday only
- maximizing the number of workers scheduled for weekends during which advertising is running
- making sure that they are out on the floor and not stuck in the kitchen so that they can work the crowd.
You might be thinking that there are people who go out to eat on Monday and Tuesday and that a restaurant advertising on those days could reasonably expect to draw more people than if they didn't advertise. That is true but in general the additional people one draws on Monday and/or Tuesday would not be worth the cost of advertising. The bottom line is that if the sum of Monday and Tuesday revenues are 15% of your total week's revenue before you start advertising, they'll probably be the same % after the campaign is over. The advertising should increase overall revenue and the owner shouldn't worry about redistributing the %'s.
Local advertisers just don't have the muscle to get folks to change behaviors and they waste their money when they try anyway.
Advertising sales people don't like to hear it but automobile dealers have a keen understanding of when to be in the market and when not to be. Right now, automotive advertising on a local level is way down because car sales are way down nationally. All over the country, local advertising sellers are pleading with auto dealers to gain "share of voice" or "share of mind" or "share of market" by advertising when the competition is not advertising. The reasoning goes like this:
"If you advertise now while the competition is idle you will gain additional share immediately. When the auto market turns around and demand is high, the additional share will be well worth the investment we are asking you to make."
This plea falls (correctly) on deaf ears. Auto dealers must measure the cost of the advertising against the return they are likely to get right now and not on some future share. The reason is simple: A very small percentage of the public is in the market for a car (maybe 3% under normal circumstances and 2% right now). Consumers only hear the advertising that pertains to them. So, any market share gains made by a local auto dealer are being made with the 2% of people who are "now" buyers of autos. These now buyers will not be in the market again for another three years so the advertising seller is asking the auto dealer to spend money with them to 1) gain market share of an unusually small pie and 2) wait three years to get a payoff on that growth in share.
Having dry powder to work with when demand returns is a much better strategy and most auto dealers know it.

This is not to say that businesses shouldn't be trying to influence the behavior of the local consumer! Essentially they should be saying:
"If you're a coffee drinker then you should drink your coffee here because of x, y and z."
instead of
"If you're a tea drinker you should consider coffee because of x, y and z and when you do change from tea to coffee you should buy it at our place."
Remember, to advertise effectively at the local level, find out how consumers are behaving and then fashion your message to take advantage of their direction and momentum.



What I get from this Tim, is the need to be realistic, especially for small and medium sized businesses. I am a firm believer in the myth of 'one time' marketing efforts, which a lot of local companies partake in. One advertising campaign is not going to be a panacea to a companies problems especially if they are go about it in the wrong way, but I wonder how many of the companies who 'fail' go on to learn and improve. Of those whose expectations aren't realised, how many go on to say 'ok, this didn't work, lets try something a little different'?
I tend to think that local companies are influenced by 'big' advertising and are tempted by the allure of success that main stream advertising offers. Unfortunately, they also expect the same results from little expenditure and as you rightly point out they don't have the clout to change and influence behaviour.
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Tim
Interesting insight… I agree with you that local advertising should possibly not be looking to change the behaviour of local consumers… however, the rest of your insight has left me thinking…
If I own a restaurant… and I used to… and my Fridays and Saturdays were jam packed and my Mondays and Tuesdays were light, then as an owner of that business I want to get more covers for early week. General advertising… leaving it to the customer to decide when to come in… to get more people queuing to get in on Friday and Saturday does not seem like a good idea. Sure, as a restaurant owner with high demand for Friday and Saturday I would be doing the things you suggest to get more people through… however, it is only natural that I would want help getting more people in on a Monday and Tuesday… it’s what I would hire a professional to help with.
Again I would agree with you… give people reasons to come to the restaurant, but extend it… give them reasons for coming on a Monday and Tuesday. People still go out to eat on Mondays and Tuesdays and so rather than change the behaviour of those who do not go out on a Monday or Tuesday are you not instead trying to attract those that do?
Paying a marketing company money to get me more customers in my busy time is like paying someone to sell water to a thirsty man… it doesn’t need selling, the customer will be buying anyway!
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Thanks for the comment, Colin. I would suggest that if you owned a restaurant that was "jam packed" on Friday and Saturday nights then you A) Don't have a marketing problem and
Many small businesses overlook the #1 source of business and that is their current customers. Why spend tons of money to bring in new customers when you can get your current customers to visit more often for next to nothing?
Of course, you are correct that there are people who go out to eat on Monday and Tuesday nights and there are marketing strategies that will attract a larger share of them. Doing so should be on the list of marketing objectives but it must be a lower priority than generating sufficient awareness, in general, of one's location, menu and ambience.
As for your thoughts that you don't need to pay a marketing company to sell water to a thirsty man I must disagree. A thirsty man has lots of choices and if you want him to buy your water you are going to have to tell him why your water is the one to choose. What you definitely don't need to be doing is paying a marketing company to help you sell water to a man that isn't thirsty as that consumer is infinitely harder to separate from his money.
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Well said Tim.
-Brad
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Thanks for this article Tim - it really made me think. I think you're right - small and local business need to be more modest in their ambitions and focus on the changes they can achieve - small ones that take advantages of existing behaviour rather than trying to make major behaviour shifts.
Ian
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