Five Things to Know Before You Spend a Penny on Advertising

Every year companies around the world spend 100's of millions of dollars on advertising...and much of it is completely wasted. Here are five things you need to know before you spend a penny on advertising.

1. What is advertising anyway? "Advertising is creative bragging."...that's it! Many companies think that they have an advertising problem when, in fact, what they really have is a fundamental marketing problem. They aren't doing anything worth bragging about.
2. Get good...then brag! Don't brag and then try to figure out how you're going to pull it off!
3. Don't lie! People aren't stupid. For almost a year there was, in the Toronto Airport, a big backlit ad for a chain of mediocre hotels that said, "You won't find any nicer hotels in Canada." This is a lie...and everyone who has ever stayed in one of their hotels knows it.
4. When you're delivering compelling functional, emotional and financial value to well understood target customers, the process of creating effective advertising is actually pretty easy. If you don't know...

• Who your target customers are,
• What they really value,
• How best to reach them...and,
• What your compelling message will be,
• ...you're not ready to advertise.

5. Your most powerful and cost-effective advertising is the enthusiastic recommendation of delighted customers!

People love "showing off" when they find a wonderful product, service, restaurant, lawyer, accountant, hair stylist, etc. It makes them a "big shot" with their friends. Plant the seed by asking delighted customers to recommend you. Tell them, "You'll be a hero...your friends will love you!"

Advertising only works if what you say about yourself is congruent with what "others" are saying about you. So, if you're saying that you're "the best" while previous customers, the media or respected authorities are saying that you're not...you're wasting your money. Remember, "Get good...then brag!"

Advertising is so expensive that it only makes economic sense when you're good enough to achieve "leverage". "Leverage" occurs when the value and experience that you actually deliver is so wonderful that every new customer that your advertising attracts enthusiastically recommends you to at least four other people! If you're not good enough to achieve that kind of "leverage", you can't afford to advertise!

So, are you ready to spend big money on advertising...or, realistically, do you have some work to do first?

Improve Your Small Biz: 6 Tips from Jim Collins

One of the most dynamic speakers at the recent World Business Forum was legendary business thinker and author Jim Collins. His presentation was wide ranging and offered many lessons that would be easily applicable for any small business owner. Here are some of the most interesting of his points that you would use to improve your small business:

1. Run a pocket greatness. Too many business owners try to expand and do too many things well. If you know that you are the best at something, then focus on that and make it into what Collins called a "pocket of greatness". When you have this, you have something that you can build from. Without it, you can lose focus.
2. Double your questions to statements ratio. This is a slightly mathematical way of making the point that you need to ask more questions about your business and where you want to go instead of creating vast vision statements or bold declarations for your business without the right amount of thinking. When you ask more questions, you force yourself into the mindset of thinking about how you will actually do something and what the barriers might be. It's an essential step towards achieving anything.
3. Spend less time trying to be interesting and more trying to be interested. Conventional marketing wisdom and most books focus on trying to help you find more ways to be interesting. I too write about this topic here and on my own marketing blog. The problem with focusing too much on this, however, is that you may be missing out on learning opportunities or leads or even just highly useful conversations if you aren't listening for them. So try to spend more time being interested in the people that you meet and ask them questions instead of focusing on yourself. You may be surprised with what you will find.
4. Turn off your gadgets and create white space. As Collins talked about turning off your gadgets, you could see the people in the audience shifting uncomfortably and the ones who had been checking their Blackberrys or iPhones look up. Putting away your gadgets and being disconnected is hard, but if you can do it then you create essential time on your calendar every week just to think about your business and what else you could be doing. This is the time where the great thoughts stuck in your mind can find their way out - and it may become the most important time of your week.
5. Create a STOP doing list. Most of us have a to do list, but how many of us have a list of things that we should STOP doing? This is exactly what Collins suggested: prioritize by clearly thinking about the things that may be wasting your time right now which you will stop doing.
6. Read beyond your field. One of the Collin's most surprising habits was that he says he reads 100 books unrelated to business every year. This helps him to expand his vision beyond the world of business and think about other areas. It gives him an essential sense of the world and what is happening, as well as ideas that he can apply to his business and for the organization with which he works. The same principle can work for you and your business.