Tag : efficiency

post image

204: What Happened When I Got a Taste of My Own Medicine?

Hair Club for Men

Most of us are old enough to remember the awkward Hair Club for Men TV commercials of the 80’s and 90’s. Even if not, you’ve still probably heard the spokesman’s iconic tagline: “I’m not just the president. I’m a client.” Sy Sperling was trying to combat the perception of snake oil sales by taking his own medicine. He forwent some of his dignity with the before picture for the payoff of the after picture and what it stood for.

Dr. Barry Marshall took this concept a step further when trying to prove to the world that stomach ulcers are caused by bacteria and not stress. The physician, who would later win the 2005 Nobel Prize in Physiology or Medicine (and eight other medical research awards), drank a solution of ulcer-causing bacteria, knowing it would lead to days of discomfort with stomach ulcers before treatment could alleviate his pain. He knew the science would work. He changed long-held assumptions by using himself as the guinea pig.

Don’t we all wish we knew our program would work that confidently?

One of the challenges of my consulting sessions over the past decade has been the difference between my business sensibilities and those of my clients. Auctioneers are much bigger risk takers than I am. I get anxious when asked, “What would you do here?” for an auction I wouldn’t have signed. I feel ill equipped when asked for direction in the frequent interesting situations where all I’ve got are educated guesses. I get nervous spending other people’s money to throw noodles against the wall to see what sticks, because I wouldn’t want other professionals doing that with my money.

At the same time, that’s why I’m bullish on the strategies you’ve read in the last several years’ worth of my blog posts. I’ve tested this stuff multiple times per week for different clients selling various asset categories in multiple geographic markets. Maybe just as important: I’ve tested this on my own company promotion. I’ve changed my advertising headlines to focus on auctioneer pain points and solutions. I’ve positioned myself as a guide to make auctioneers heroes rather than as a hero for hire.  And I’ve used the advanced Facebook ecosystem tools I use for my clients every day.

 

Biplane graphs

Biplane Productions opened for business 16 years ago this week. You can see in the charts above that this triumvirate shift not only halted downward trends but also grew my quantity of auctions and billable work far beyond my previous high points. Before and after this transition, I taught for the National Auctioneers Association (NAA). Before and after this transition, I wrote articles for state and national auctioneer publications. Before and after this transition, I blogged and forwarded those blogs to hundreds of industry subscribers.

What changed was the messaging and how I delivered that message. Those are same two things I suggest auctioneers change about both their auction advertising and their company promotion.

I’ve also long told auctioneers that their best company promotion is consistently-good auction promotion. Fantastic sale prices create buzz and confidence. Taking good care of the transaction at hand brings more transactions. Following that advice has brought me new business, especially for my Facebook services. I get tagged in comments within auctioneer discussions all the time. My clients are sharing their success stories so much now that I’m working for dozens more auction companies per year than I was just a few years ago. People who’ve not seen my actual work and even auctioneers I’ve not met in person want to hire me as a vendor—in part because now my auction advertising is blowing up their friends’ commissions and/or lowered their auction budgets.

This past summer, a schedule conflict caused me to miss the NAA’s Conference & Show for the first time since 2002. Since I couldn’t mingle or teach a class, I relied on Facebook and Instagram to keep me in front of the auctioneers in Jacksonville. I built three ads to appear to auctioneers and NAA fans within a mile of the convention center. Along with those, I designated a fourth one to appear to auctioneers and NAA fans across the country.

Conference & Show ads

I got several inquiries and two new clients out of those ads that week. (Between you and me, I rarely get new clients from Conference & Show.) I didn’t try to wow an audience with a continuing education class that took hours of prep work and days out of the office. I didn’t treat anyone to dinner or breakfast. I just succinctly spoke to perceived needs and wants in a convincing way. My acquisition cost was a small fraction of my typical outlay for travel, lodging, and conference registration.

Does this mean I drop NAA events from my routine? No. Just as with auction advertising, sometimes inefficient marketing pays long-term dividends. Not every auction can afford expensive advertising, though. Efficient advertising comes in handy when the budget is small, when the campaign requires a lot of experimentation or guerrilla tactics—especially if you know what made it efficient.

Facebook ads (and even more so Instagram ads) force us advertisers to get to the point. Ads that make that point about the consumer instead of about the auction turn already-cheap website visits into ridiculously-cheap website visits. It’s not enough just to have advertising on the right platform. You have to speak the language of its audience when you get there.

This summer, I A/B tested a client’s requested headlines, audiences, and photos against my selections for those auctions. With the same assets in the same auctions, my cost per click ranged from 33% to 55% of the costs of their ads. I was able to get 45% to 67% more people to their website on the same budget.

How did I know something like that would be the result? What gave me the confidence to bet on myself? It wasn’t that I had some secret knob to turn or switch to flip. I just knew what to expect from what I’ve observed across hundreds of auctions and dozens of my own company promotions. I’ve benefited from drinking my own Kool-Aid and taking my own medicine for the past three years. I’m a convert and a missionary, the doctor and the patient, the scientist and the test subject. I don’t think I’m the president of the club, but I’m most definitely a member of it.

Stock image purchased from iStockPhoto.com

post image

199: Why Manure Spreaders Are In Increasing Demand

Recently, I was consulting a non-auction business that had an incredible business opportunity, especially for their geographic market. I’m talking about the kind of concept I’ve seen featured in viral Facebook videos and profiled in Fast Company. I was excited for them until I heard their brand message, saw their visual branding, and learned their marketing strategy. They had adequately identified their ideal prospect but somehow totally misunderstood their prospects’ various levels of needs, habits, and expectations. I mean, like 170º in the wrong direction.

As I gently questioned these misalignments, they dismissed my concerns. They wanted to know more about the tools and tricks I use on Facebook to reach more people. They just wanted to get their bad message cheaply in front of more prospects like their ideal customer.

I see this all the time, actually—just not so drastically. I’ve seen it from people I’ve consulted in emails or phone calls, in conference hallways or Facebook threads. Entrepreneurs don’t want to improve their advertising; they just want more targeted places to put it.

Apparently, lots of folks want a more efficient manure spreader.

Dung Spreader

Knowing where to be on a platform or in a specific media outlet is important. Targeting makes advertising more efficient. But content is advertising’s linchpin, especially on social media. Facebook, Instagram, and other platforms reward ads with compelling and empathetic content by giving them lower costs per click.

The problem most auction marketers (like other small business marketers) face is our inherent bias. We wrongly assume our ideal buyers and sellers are just like us. We assume the marketplace looks at auctions and the assets in them through the same lens we do. “If we talk about us and our stuff louder and in front of more people, we’ll get more customers.” We don’t say that. We just operate from that mindset.

This can work in spite of itself, but you’ll get more efficient results from your advertising if you delve into the thing behind the thing.

What problem does your auction’s assets solve?

How will their life be easier or better after the purchase?

What aren’t they able to do that they will be able to do after a winning bid?

What dream could come true if they are willing to pay more than anyone else is willing to pay?

For instance, most real estate investors don’t want to own more property. They want more cash flow and/or more financial security. Most sportsmen already have access to a place to hunt or drive their UTVs. What they want is to avoid asking anyone permission or having to call in any favors. That twenty-year-old John Deere 9600 is easier to work on than a newer combine, even if it is less efficient and autonomous than one you have to take to the dealer for service.

A collector wants to complete their collection, find the item nobody else has, or even make their peers jealous. A young mom wants her children in the right school system. Many startups don’t care if the furniture matches or if the equipment is new, if they can operate with lower overhead. Flippers want to make money quickly with a little elbow grease or ingenuity.

When you advertise to targeted audiences, does your advertising speak to their needs and wants?

Even if your advertising doesn’t leverage this progressive, psychological analysis, you can still benefit by sticking to the asset over the event. People don’t buy auctions. They buy assets, and they hope to buy at “auction prices.” (The exception: at benefit auctions, they’re buying ego, belonging, participation, an eased conscience, and/or a sense of altruism.)

When you implement the tools for targeting but then give those prospects a faulty message, you might actually drive business away—whether from imminent or future customers. The American advertising legend John Caples posed this reality in his book, Tested Advertising Methods. “The wrong advertising can actually reduce the sales of a product. . . . George Hay Brown, at one time head of marketing research at Ford, inserted advertisements in every other copy of the Reader’s Digest. At the end of the year, the people who had not been exposed to the advertising had bought more Fords than those who had.”

When we push our agenda, our brand can become seen as a source of unwanted content—white noise surrounding content consumers want.

If we’re trying to sell people something instead of meeting their needs, we become that screaming mattress or carpet or used car salesman on TV. Even if someone wants what we’re selling, current and past impressions might detract from buyer willingness to interact with our brand.

You can stick with “AUCTION!!!!!” as your headline and the date as your subhead. You’ll still have your cadre of wholesale buyers, but you could confuse or annoy your retail buyers out of the process. I don’t know about you, but I’d prefer commissions on retail prices rather than wholesale prices.

Avoiding that buyer disconnect is difficult, but it’s not expensive. In most cases, it doesn’t cost more money to have the right words in your headlines than it does the wrong ones. When it does, there’s a good chance the extra cost is outweighed by the extra benefit.

Don’t get me wrong: I know how to upgrade your manure spreader to hurl waste farther or place it more strategically. It’s just that I grew up next to a farm, and I come from a family of dairy farmers. Trust me. Your buyer community already has a perception of how your advertising will smell.

Stock image(s) purchased from iStockPhoto.com

post image

155: Why Businesses Advertise Backwards

When someone says “Super Bowl commercial,”  your mind probably imagines one of the whacky or sentimental spots that Forbes reports costs $5 million per 30 seconds in this year’s Super Bowl. This creative ad, though, won’t be shown Sunday night. It’s a commercial about Super Bowl commercials.

The moral of this short story is that Super Bowl commercials are big gambles for the vast majority of brands in our country. Most of us get that; so, the ad plays as an inside joke.

That said, I regularly see auctioneers fall for the same line of thinking: that a bigger audience is a better audience. I’ve seen auction marketers try to hedge their bets with the assumptions that a bigger mailing list is better than a small one, that a metro newspaper with 300,000 subscribers trumps the local paper with fewer than 5,000 weekly readers, or that a boosted Facebook post to everybody in a radius beats a demographically-targeted post to 1,200 people.

Maybe sometimes. Not usually, though.

Media is typically sold to advertisers using a measurement called “cost per mille.” The basic idea is to take the cost of an advertisement and divide it by the quantity of potential audience impressions. So, if you pay $500 to reach 10,000 subscribers, you’re looking at cost of $50 per thousand.

In the auction industry, my clients are regularly marketing to smaller audiences.

So, I like to take that one step further and determine the cost per person. In the example above, you as an advertiser would be looking at an investment of $.05 per person. This number can be helpful, when budgets are tight; and you’re looking for the most efficient media possible. We all want the most bang for the buck.

The problem with both cost per mille and cost per person, though, is that they distract from a more important metric: cost per prospect. Cost per mille asks, “How many people can I reach with my money?” Cost per prospect asks, “Who are my most likely buyers (or sellers)? What will it cost to reach them?” Cost per mille promotes scale. Cost per prospect promotes efficiency and effectiveness.

Size of the audience is less important than relevance of the audience.

Whether it’s a mailing list or a publication, a website or a social media platform, the primary question marketers should ask is not, “How big is its reach?” but “Are these the right people?” It’s the difference between spectators and participants. (Helpful tip: we want participants.)

Once you know you have the right people, divide your budget by the number of those prospects to determine what you can spend per potential client. If you don’t have a budget big enough to make a good impression to all of the prospects, maybe sift those prospects down to a quantity you can. Some auctioneers work it the other way, cutting the size or impact of the media. So, they send a postcard instead of brochure or an email instead of direct mail.

For company promotion, I’d keep sifting until I can make an impression that can’t be ignored. It’s not uncommon for me to spend $150 to $500 of my time and resources per potential client I pursue, but I only work for 15-30 auction companies per year. I’ve helped auctioneers spend hundreds and even thousands of dollars on a single proposal presentation to a single client. The nuclear company in my area probably spend tens of thousands of dollars to convince a power company or municipality to buy one of their eight- and nine-figure reactor systems. Your effort should be proportional to the value of their business.

That might mean you’re looking at mailing a package instead of a postcard, arranging a free seminar instead of an advertorial in the business journal, or drafting hand-written notes instead of form letters. Discover what would impress a client; then do it.

A media sales representative can’t tell you your cost per prospect.

Only you can do that. Whether you’re actually taking a calculator or spreadsheet to it is less important than operating from the prospect mindset. Start with the audience and work backwards. If you’re going to gamble, improve your odds. Work to find the valuable few instead of the risky many. No matter how many people see your advertising media, you want the ones who do interact with it (1) to relate to the content and (2) to be impressed.

Feature image purchased from iStockPhoto.com.

post image

The Most Important Mailing List (That Auctioneers Aren’t Using)

For years I’ve preached that the most important mailing list for an auction company to use is their list of past bidders. But I’ve been wrong—at least partially.

The line of thinking was that the most qualified prospects are those that are familiar with the auction process and have shown past interest in a specific asset category. Also, with Facebook’s Lookalike Audience tool, you could leverage the email address column of this in-house list to find tens of thousands of similar people just like your bidders (in any geographic region). For one of my clients, that Lookalike Audience technique has led to a noticeable increase in his average quantity of registered bidders.

Here’s the problem, though: if you do enough auctions, that list is going to become unwieldy—too large to efficiently send direct mail in the entirety. I’ve worked for a handful of auction companies who regularly mail 6,000 to 10,000 pieces to in-house lists; and I’ve consulted auction companies that mail tens of thousands of pieces per auction. I’ve regularly been asked how to sort a proprietary list down to the best candidates.

You can sort that by recent participation or number of auctions to which they’ve registered. If you specialize in personal property, you could also sort by expenditure levels. The problem is that there’s no way to tell—outside of maybe the art/collectibles or charity/benefit markets—if someone who bought something in the past wants to buy more of the same.

We can’t know who the satiated buyers are on our lists. If a past bidder was searching for a specific asset at a specific time, there’s a good chance they found what they wanted at the auction and/or somewhere else between then and now. This is especially true of lists I’ve seen auctioneers curate for a decade or more—something they not only often do but also advertise as a selling point. Because of this high probability of satiated buyers, our in-house lists have only a slight advantage, if any, over a purchased mailing list or Facebook’s Lookalike Audience tool.

There’s one direct mail list I would trust more than both a purchased list and a generic “past bidders” list. Other than time, it should cost nothing to capture. It’s a list of possibly the most motivated and qualified candidates for your next auction of a similar asset.

Your recent runner-up bidders.

I don’t think I’ve ever talked to an auction company that recorded that segment of their buyers. Online bidding platforms keep this information. These bidders shouldn’t be too hard to discover at on-site auctions, either—especially real estate ones. These folks are already in your clerking software. All it’d take to pull this data is an extra column in your database to indicate that they came in second.

This list will be relatively small in comparison to your whole list.

Maybe these prospects get a bigger postcard or brochure, while everyone else gets a cheaper teaser piece. Or maybe they’re the majority or entirety of your direct mail recipients, while everyone else gets emails and Lookalike Audience ads on Facebook (and now Instagram).

Facebook just announced last week that it’ll now be better able to match our mailing lists, as it opened up its tool to search by names and addresses—not just email addresses and cell numbers. Theoretically, that means we will be able to build Lookalike Audiences from smaller lists than those it currently needs. So, small lists of backup bidders might now be large enough to have their own Lookalike Audiences.

It’s a lot harder to unsubscribe from direct mail than email. So, even a list of people who’ve signed up for your mailing list could no longer be as full of interested parties as you think. If those prospects aren’t turning into bidders anyway, how much is that one-time indication of interest really worth?

Past bidders are a better guess than the general public, but those that left with money and without an asset are even better.

At the very least, it’s worth A/B testing your mailing lists to see which ones generate the most bidders and buyers. Best case scenario: this slice of your in-house database could free up a lot of marketing budget.

Stock image purchased from iStockPhoto.com

post image

135: The Magic Formula for More Efficient Advertising

For years, I’ve been saying that there’s no silver bullet in auction advertising. I’ve taught in my seminars that there’s no Ronco “Set it, and forget it” strategy, because the one constant in marketing is that there are few constants.

It’s time, though, that I come clean.

There is a foundational formula that applies to all auction advertising, including yours. Using it can transform your sales pitches & seller proposals, your media spends & overall budgets. The number in its answer trumps all the numbers in your Google Analytics, Facebook Insights, and Mail Chimp reports.

Very, very few auction companies that I’ve consulted are using this formula, but the ones who are have a competitive advantage over the ones who aren’t.

I’m talking about Cost Per Bidder Per Medium.

Knowing your generic cost per bidder would be interesting—discovering how much it costs you on average to get a consumer to register to bid; but it wouldn’t be much in the way of actionable data. Knowing how much it costs you per bidder per medium, though, goes beyond interesting. That knowledge is incredible marketing power.

Here’s the basic formula:

Cost Per BidderNow, repeat that for every medium or every media category you use in your advertising: signs, direct mail, newsprint, paid search, social media, public relations, etc. Save that information, and repeat this process every auction. After a few months, you should start to see patterns on the aggregate. You’ll discover that some media are less efficient than other ones.

If you sell more than one type of asset or the same asset in more than one geographic area, you may want (1) a larger set of samples or (2) separate spreadsheets for each market.

Once you get enough of a sample size collected, you can use it to start adjusting your budgets to favor the most efficient source of customers. For example, if Facebook costs you $5 to acquire a bidder, and newsprint costs you $50 in bidder acquisition, then you can start shrinking the size or frequency of ads to send money over to social media.

You can have hundreds of people click to your website from your email blast or thousands from social media. If the only people who show up at your auction are the ones who saw the sign, though, that traffic is empty. If your YouTube video went viral or your phones have been ringing off the hook from a press release that’s hit all of the local news, but most of your bidders all brought your direct mail piece to the auction, then the buzz didn’t bring you buyers.

Buyers trump traffic.

Speaking of buyers, you can take this formula one step further to separate the tire kickers from the paying customers. In the formula, you can replace “bidder” with “buyer.” If you want to know how much you spent per buyer, the formula looks like this:

Cost Per Buyer
The formula is simple, but the data collection tends to be the hard part for auctioneers. The spend side of the equation should be easy to capture, since you already have invoices and probably a formula-driven Excel budget. You can add a couple columns to that budget to do this math for you and then link to those result fields in a master spreadsheet.

Then, all you have left is asking bidders where they saw or heard about the auction. (It’s okay if they choose more than one.) You can poll them at on-site auctions, and you can create a toggle-list question for those who register to bid online. Using some tools currently taught in the Auction Technology Specialist designation curriculum, you can even track online bidders passively from their first interaction with your online AND offline media all the way to the bidding page.

If this seems like a lot of work, think about how much more work this information could help you book. Imagine if you and another auction company were vying for the same auction, but you alone could show the seller exactly where they can spend their money the most efficiently. Do you think you’d look a step ahead of your competition with a summary from the past year’s advertising effectiveness in their asset and geography markets?

That’s a rhetorical question.

It will probably take you six to 12 months to build reliable statistics. So, you’ll want to start as soon as possible. Don’t wait. I can name auction companies with more than a year’s head start on you.

Stock image purchased from iStockPhoto.com

post image

113: Branding Lessons from a High-Rise Crane Operator

I had the privilege to climb a 15-story construction crane and interview its operator. He graciously answered a bevy of my questions, some of which probably sounded mundane or elementary to him. While I learned about his fascinating world 57 meters above the other workmen, one of his answers surprised me as much as any.

Rudolph in Action

We were standing next to the counter weights on the machine arm—the short boom on the back of the crane opposite of the long boom (called a “jib”) from which the hook descends. I asked, “How heavy of an object can you lift with this thing?”

“Out on the end, one and a half tons—maybe two tons. Close to the middle, I can lift three tons,” Rudolph answered in his heavily-accented English.

He might have meant tonnes (2,205 pounds) instead of tons (2,000 pounds), but the proportions are the same. Either way, the closer he got to the central mast, the more he could lift. The closer he got to his core strength, he got more efficient and more capable—with less risk. He could take fewer loads to move the same amount of material or take on loads otherwise impossible.

 

Where Rudolph Works

I highly doubt Rudolph realized the inherent advice that he was giving. It’s the same advice I give college juniors and seniors who ask me how to build a successful business and the advice I give nascent auctioneers in the halls at conferences: “Focus on your core competencies. Find what you do best, and focus on the niche market that values that.” It’s advice I had to learn from experience.

Early in my career, I took on work at the end of the jib. Technically, I managed to move whatever the material I was asked to move; but I wasn’t efficient at it and, candidly, probably not even effective at it. Eventually, I got out of web design, then logo design. I stopped taking on projects from companies outside the auction industry (except for barters). I’m now even considering dropping a service for which I’ve won an award—because my hook seems at the end of the jib every time I provide it.

The difficult part is giving someone the direction to head from that advice. You can’t always follow your heart; it often leads you to hobbies and/or unemployment. It’s more than honing a natural skill. If a lot of people have the same skill, you’ll struggle as a commodity. It’s unfair to depend on serendipity; but somewhere in the mix, it seems like most entrepreneur tales and success stories hinge on it. Mine does, too.

That said, once you find that sweet spot—that area of specialty, that niche of proficiency—stay there. As soon as you can, discover where you’re an expert and stray as little from that prowess as possible. Why?

  1. The more efficient you are, the less you’ll have to work for the same income.
  2. You’ll waste less time & energy and give fewer excuses & apologies to customers—some of which can be very expensive.
  3. Customers prefer experts, and they’ll usually pay an expert more than they’ll pay a general practitioner.
  4. By default, you’ll have fewer competitors, the farther away from generalist you can brand yourself.

The adage is true: the jack of all trades is the master of none. You can’t specialize in six different auction (or graphic design) markets. That would mean that you average 16% expertise per segment. If someone is looking for a specific specialization, they’re going to look for someone whose expertise averages as close to 100% as possible.

When I tandem hang glide, I don’t ride with just any pilot—even though my church buddies fly helicopters, experimental aircraft, 767’s, and acrobatic stunt planes. I ride with a licensed, tandem hang gliding instructor. When I want my MINI inspected for a track day, I take it to the only BMW racing specialist in town—not one of probably a dozen DMV-licensed inspection centers in the Lynchburg area. And if I ever had to lift 5,000 pounds of rebar ten stories and drop it next to a South African contractor, I’d ask Rudolph.

Taking It Personally

I benefit from people who have heavily invested themselves into one hobby and can help me experience them, but I tend to dip my toes in multiple adventures rather than dive into any one of them. I’m the same with vacation spots, as I generally prefer to explore a new destination rather than revisit an old one. From what I’ve read online, the stimulation from new experiences keeps our brains active and more creative.

In other words, diversity is good for most of us. While I teach others to stay in a professional niche, I tend to encourage acquaintances, friends, and family to broaden their horizons off the clock. The world is too big of a place to leave unseen.

This morning [January 16], as I walked the streets and sidewalks on a continent I’d never seen before yesterday, I thought of a quote from G.K. Chesterton: “The whole object of travel is not to set foot on foreign land; it is at last to set foot on one’s own country as a foreign land.”

*SPECIAL THANKS to Ian Immelman for granting me access to the WBHO crane and to Rudolph, its operator!*

109: When Is An Audience Too Big?

F150 AdThis coming Sunday, corporations will be spending roughly $4 million for each 30 seconds of advertising they obtain.  Even at these rates, available commercial slots for 2014’s big football game sold out in 2013.  It’s the most watched TV show in North America every year with an expected audience of 108,000,000 consumers.

If you’re doing the math at home, that’s 3.7¢ that advertisers spent per potential viewer.  Most media won’t break it down for you like that—instead going with cost per mil (CPM), which means cost per thousand viewers.  In this case, that’s $37.04.

Whenever I see expensive ads like these, I wonder three things:

(1) How many times someone has to see this ad before they decide to purchase?
(2) How many units does the advertiser need to sell just to break even on this commercial?
(3) How much of that product’s average price go to just this commercial?

Take, for instance, the Ford F150.  Ford sold 763,402 F150’s in 2013—the most of any vehicle sold in the US by far. If Ford Motor Company purchased only one 30-second Super Bowl spot and if this were the only ad that they ran all year, every truck’s price would include $5.24 for just this ad.  Based on the number of TV and magazine ads for the F series that I see in my limited broadcast media interaction every year, I wouldn’t be surprised if owners of new F150’s are paying for more than $1,000 in advertising.

Whatever the number is, Ford & Chevy, Verizon & AT&T, and Budweiser & Coors have found it reasonable, if not necessary, to spend so much on mass marketing.  For my clientele, too, a CPM of $37.04 would seem a good deal for their small business marketing, especially their event marketing.

That $37.04 can be deceiving, if not expensive, though.

Half a decade ago, one of my former clients—no longer in business—asked me to advertise a New Jersey construction equipment auction in the Philadelphia Enquirer and the New York Times.  I asked him, “How many people looking for an excavator look in the Sunday classifieds of a metro paper?”  If every one of the combined 2,342,631 subscribers of those papers on Sunday happened to turn to that ad’s page and also perused until they found that tiny ad—still probably only a fraction of 1% of the audience would care about its content.  And that’s the best-case scenario.

For the same amount of advertising spend, he could’ve bought sizable ads in construction equipment publications and on related websites—where the percentage of audience being qualified prospects would be exponentially higher.  Or he could’ve spent less overall for more conservative advertisements across all of the targeted media.  Sure, the CPM would’ve been significantly higher; but the value would be exponentially higher.

Be careful when an ad agency tries to sell you national ads for a campaign that only needs local/regional media or regional/national asset media.  Most ad agencies in the States make a commission—usually around 15%—back from the media for the advertising you buy.  Commissioned sales reps from both agencies and media alike will sell you on audience size (sometimes called “total reach”); but look, instead, at percentage of likely buyers from that audience.

Instead of CPM, I recommend evaluating media use based on cost per qualified prospect (CPQP).  It’s better to pay a lot to reach people who are likely to pay you a lot.

One of my auctioneer friend’s campaign came at a cost of roughly $65 CPQP, but he only mailed to between 75 and 80 people.  From that very small audience, though, he made over $100,000 in one year. That’s an average of almost $1,300 in revenue per prospect.  Not per sale.  Per prospect.  That’s a number that no Super Bowl advertiser can match and that no ad agency can promise.  While this might be on the high end of expectations, the principle it illustrates holds true.

On a related note, I recommend polling your bidders per media outlay to determine what your cost per bidder is from each. Tim Narhi Auctioneer & Associates do a great job of this and can show a seller what they spent per bidder per media for several years’ worth of auction advertising—including almost any one specific auction.  Those numbers trump any statistic an agency or media rep will tout.

The feather-in-your cap ads like those in the Broncos/Seahawks game might appeal to your ego, but targeted marketing will make that net proceeds check appeal to your wallet.
[tip]

We live in a big world, and the religious affiliation of that population is quite diverse—so much so that I don’t know that any one faith system (or lack thereof) includes a majority of the global population.  For those of us who think the eternal stakes of believing an errant way are high, the temptation is to evangelize to the largest audiences possible.

God uses crusades and impersonal pamphlets.  I’ve met people whose life trajectory has changed from them.  He might even use television and radio programs, in spite of the characters that populate most of them.

From my own experience, though, I’ve seen the most efficient sharing to come on an interpersonal level.  Conversations in a coffee shop, book clubs in a cafe, table talk at a church environment.  Life change happens deepest when lives are rubbing against changed lives—when someone can say what the Apostle Paul did, “Follow me, as I follow Christ.”

[footer]Stock photo purchased from iStockPhoto.com.
F150 image screen captured from online commercial.
Volkswagen ad frame downloaded from Google Images.[/footer]

71: Getting the Right Clients On Board

Jetliner SeatsI’m writing this post on what will probably be my last jet flight out of the Lynchburg airport. To kick off 2011 on an efficient foot, Delta will be withdrawing its regional jet service from Atlanta, leaving Region 2000 citizens with the choice of US Airways prop service to Charlotte, private jet charter, or a long drive to a Virginia or North Carolina city with an interstate exit.

Even with 80% average occupancy on it’s 2010 flights, Delta hasn’t turned a profit here since 2008, when it operated at 62% average occupancy.† In an effort to offer Delta a package that would keep flights connecting ATL and LYH, Lynchburg city officials brought in airline industry consultant Mike Boyd. Boyd told them the problem was not how many passengers were on the planes but what type of passengers were on the plane.†† In a small city with multiple college campuses, our jets fill early with lower fares, instead of higher-margin last minute purchases typically purchased by business travelers. (Boyd suggests that Delta embargo availability of a number of seats until the last two weeks before departure to regain the higher-margin fares.)††

I can’t fault Delta. As I track productivity and profitability for biplane, I excuse myself from specific accounts, refer work to competitors or peers, and selectively change pricing structures.

Not all clients are created equal, even if they can keep you equally busy. Most of us want high-margin, headache-free work; the challenge is how to attract that work.

Part of that is branding—answering the questions, “What public personae are we projecting? And what kind of business does that attract?” You will have an uphill battle attracting premium clients with subpar marketing or high volume liquidators with a mom-and-pop feel to your collateral.

Part of that is taking the time to measure efficiency, review profitability, and quantify intangible aspects of your work. You might be surprised where you’re most efficiently generating revenue. Then there’s the question I asked during a recent consultation: “How much do you need the money that comes with that headache?”

Part of that is a brave self-control to shew away a bird in the hand to make room for one or two in the bush. A good, indirect way to sift prospects is changing your price points and/or terms of transaction. Sometimes, I just explain to now-former clients or prospects that biplane is not a good fit for them. It’s better to have a difficult conversation on the front end of a poor fit than on the post-game evaluation. (I’ve learned that one the hard way.)

So, where’s your sweet spot? For some it’s in high risk/reward problem solving; for others it’s in predictable efficiency.

And with whom are you working when you’re in your wheel house? It might be a demographic group, a personality type, or infrastructure.

From where do these good fits come to you? Answering this question will give you a good start on where you can go to find more clients like them.

Successful, popular brands—name plates like Apple & BOSE, CNN & FoxNews, MINI & Jeep—don’t appeal to the blank masses. They implement specific brand strategies to duplicate their happy customers. Do you?

[footer]†Bryan Gentry, “Delta to discontinue service from Lynchburg airport,” October 27, 2010, Lynchburg News & Advance
††Bryan Gentry, “Consultant: Lynchburg airport could keep Delta,” November 12, 2010 Lynchburg News & Advance[/footer]
[tip]

I’m really glad God doesn’t take just the easier cases, those with wills more pliable than mine. I’m thankful his invitation isn’t segmented to a specific people group.

The hard part for me is extending that patient, unbiased, consistent grace to others. So often, I prefer to associate with those who agree with my theology, those whose journeys are closest to my own, those whose needs fit into my available time and resource windows—the people who I’d look forward to having on my street in heaven.

But, as Andy Stanley wrote, “Grace is inviting to the unrighteous and threatening to the self-righteous.” When ugly feelings brew inside me over certain people, I am convicted by this litmus test and have to ask myself if I’m starting to take credit for any transformation Christ has accomplished in me.

[footer]Stock image used by permission through purchase from iStockPhoto.com ©2010.[/footer]

[bump]

What’s Your Time *Really* Worth?

Time is MoneyWhat do you make an hour?

I’m not asking for you to tell me—just wonder if you know.

“What does it matter?” you might ask. “I don’t get paid by the hour.”

Actually, you do. Everybody does. Whether you’re a high schooler making minimum wage, a manager on a salary, or a business owner netting six or seven figures, people pay you for your time.

“No, they pay me a commission,” you might say—or, “No, I get the same check every week, regardless of time worked.”

95% of biplane productions‘ 2010 work has been invoiced via flat fees, not hourly billing (94% in 2009). But I can tell you what I make an hour per quarter, per client, per auction type, per individual auction, even per task within each auction—for every auction biplane productions has ever helped advertise. I can tell you how many minutes it typically takes me to upload your files to the print shop, how many minutes I spend on the phone with or typing emails to you, and how many minutes I spent manipulating budgets of your media expenditures. Diagnose me with a disorder, but it has given me great insight into what I do and how it’s done.

See, the more efficiently I work, the more I make an hour. Same goes for you. Efficiency can either earn you the same pay but with extra hours with family, friends, or unconsciousness—or earn you more dollars for the same amount of hours at the grindstone. Either way, you can make the hours you work worth more to you and to your clients.

But ambiguously trying to streamline your work flow without tracking your time is like trying to get out of debt without establishing a budget. And simply blocking time in your Day-Timer or iCal only tells you when work will be done. You have to record receipts of your time and store them in a format that can compare them, add them, average them. Lots of industries do this—lawyers, accountants, engineers, ad agencies, auto mechanics—they just use it for billing purposes.

Whether you record the time with a time stamp machine, a pen and paper, or with electronics doesn’t matter. It could be 3×5 cards you keep in your pocket or a slick iPhone app. Mine is a sheet of lined paper on the front of each project folder (assisted sometimes by sticky notes) and a formula-filled Excel spreadsheet.

The key is that you can see patterns and anomalies.

It’s not as complicated as you think. The insight you gain from this collection will be more than worth the five to 15 minutes per auction (or other project) you’ll spend recording your time. You will be surprised at some point. I have. Some jobs that seem to have taken forever or been a schedule pain have proved surprisingly profitable for me, and some jobs I’ve thought were a breeze actually netted me a disappointingly-lower wage for my time than I would have guessed.

I’ve added some columns over the years that give me even more telling information such as: type of auction property, number of auctions per campaign, number of properties per auction, number of days from invoice to payment, number of days a folder sits on my desk, and number of days before the auction that I get all materials from my client. By adding dates, I have almost eight years’ worth of trends to tell me the best time to take a vacation, when to anticipate hearing from my less consistent clients, etc. Combined with QuickBooks graphs, I have reliable accuracy in estimating my daily schedule and general cash flow.

If none of this appeals to you, what if I told you it might help you book a sale? Let’s say you’re presenting a proposal to someone who thinks all an auctioneer does is spend an hour talking to newspapers and a sign company, another couple hours at an open house, and then shows up to the auction. Now imagine you can show them number of calls fielded on average, the time spent managing advertising, or the average amount of cumulative man hours for that kind of asset. You can prove your worth and assure a seller their money is well spent.

It might even change how you do auctions. Maybe you find that online-only auctions net you more dollars per hour. Maybe you find that you can charge less for residential auctions than commercial. It might give you a competitive advantage in proposed commission structure. Instead of closing your multi-par auction after the whole-property bids, you realize you can substantially increase a month’s worth of dollars per hour with an auction that’s 30 or 60 minutes longer—by reopening the bidding up to single tract and combination bids.

For me, it’s changed who I take on as clients—and to whom I market my services. It’s shown me where to subcontract certain services and where to keep tasks in-house. I’ve seen bumps in efficiency after buying a larger monitor, after going to FTP technology. I’ve been able to keep my annual price adjustments inflational while giving myself a raise each year—just by getting more efficient.

How about you? Do you have a metric for profitability? Since “time is money,” you can determine true profitability only when you can see your value in terms of rates instead of income.

Capitalism allows supply and demand to set our prices. But efficiency allows us to set our wages.
[tip]

Today, I again played with this ESPN salary calculator, which calculates how much a person’s annual income would buy in terms of a famous athlete’s performance. For instance, a Yankees pitcher makes my annual income for fewer than two strike outs (which might take me a year to do). An L.A. Laker makes my yearly wages for less than five rebounds. My 400 auctions in 2009 were worth less than 40 yards thrown by a recently-fired NFL quarterback.

Now, I could get discouraged by that; or I could realize that we are professionally worth what people will pay for us to do that. While we can’t control what culture pays for various professions, we can work to be on the top end of our respective industries. The harder realization for me is that my growing hourly worth in biplane’s hangar doesn’t make me worth any more as a person. My vote counts as much as Warren Buffet’s. I’ve been given the same amount of hours in a day as Steve Jobs has. Jesus died for panhandlers and Gulf Stream owners, me and you.

So, while some lives may have more public value than others, we all have the challenge to make the most of the lives we’ve been given. We can’t arbitrarily add days to our lives, but we can add life to our days.

The apostle Paul told us to number our days, to “redeem the time, because the days are evil.” The Bible regularly suggests that we leverage our relatively-short lives for eternity. So, how much Life inhabits your days? And how contagious is that Life in the lives around you?

[footer]Image(s) used by permission through purchase from iStockPhoto.com ©2010[/footer]

33: Insights from an Intern[ship]

InternshipFor the past semester, biplane productions has hosted a Liberty University internship for Garret Giesler, a talented college senior about to head into the job market. Every weekday, from two to five, I’ve had a paid accomplice in my random acts of auction marketing.

While internships by nature provide practical education for aspiring undergrads, the process was not without lessons for me. In addition to the adjustments of having a second work station in my office, a second paycheck to write, and an embargo on afternoon naps, I managed to grab some self-awareness and with that more than a cost/benefit analysis. Here are the main insights I gained from the experience.

Teaching what you do codifies your motives and methods.
I love teaching and enjoy giving seminars. If it weren’t for the bureaucracy of the education system, I wouldn’t mind making professorship my career parachute (especially in a great town with at least 7 college campuses). Even more, I love taking people on my adventures and seeing their sense of accomplishment grow. Garret’s internship proved both a senior-level class and a bit of an adventure (read his take on the experience below).

For Garret to be useful to biplane, I needed to explain:
the design principles that guide my art,
the strategies I employ with my working relationships and business planning,
the methods I use to organize the 300 projects annually on my plate,
the reasons that specific tasks are (or are not) important,
and the brand heritage my clients and/or I’ve built.

Find an overflow valve.
In 2008, about 89% of biplane‘s revenue originated from auction campaigns (up from 85% in 2007 and 79% in 2006). I like it that way. For auction projects, I charge flat fees. So, the faster I work, the more I make an hour. Auction projects are easier to estimate time and costs, and they get off my desk and into invoices faster. But to be a fuller-service vendor for my clients, I need to be able to create proposals, promotional media, and non-auction collateral.

Normally, during my spring and autumn busy seasons, these ancillary projects get pushed beyond the back burner, almost as far as biplane‘s in-house projects. Garret’s talent and availability allowed me to delegate, focusing my time on my core efficiencies. I was better able to serve my clients by bringing an extra servant to the table. I don’t have (or want) enough of this work to hire an employee or subcontractor, but Garret’s work shortened my overall task list and lessened the “regret stress” I carry when I can’t get to a project that’s important but less urgent than my auction deadlines.

Reflect on your journey.
One of Garret’s tasks was organizing my archives of print pieces. I have to admit, I was embarrassed by some of the pieces he found—even more so when I opened the portfolio binders of my pre-biplane work. I remember when I thought that stuff was top notch, when I worked for those now-gone clients, when I learned the lessons that shaped my career. Humbling, it gave perspective on the journey to April, 2009. I came into the auction industry having never sent a single project to press or an ad to a publication. I do one of those tasks almost every day—and over 1,200 times a year. I’ve learned a lot at the expense of others, as well as my wallet. This process required me to take myself less seriously.

Give back.
I can never take more than partial credit for biplane‘s altitude. The list of meaningful, irrefutable contributors to my success and accomplished dreams grows proportional to my gratitude. I think about the risk people like Gene Klingman have taken on me, the patience entrepreneurs like Rex Schrader have extended to me, the advice my elders have passed to me, the referrals and forgiveness my clients have doled to me, the God who dreams bigger than I do, and the parents who invested the intangible in me.

I found a sense of contribution to the circle of life in helping Garret obtain his needful academic credits and desired real-world experience. (Surprisingly, biplane was the only ad agency in Lynchburg to even return Garret’s internship inquiry.) I was also able to use Garret’s much lower hourly costs to save my clients’ money on their projects. biplane also was able to donate some of his inexpensive time for free projects—illustrating my gratitude to clients and adding value to their relationship with biplane.

Results may vary with your internship (or similar) experiment. But you’d be hard pressed to get more from a $1,500 professional consultation than I got from 180 hours with a college student.
[tip]

You’ve probably heard it, too: “If you want to learn something, teach it.” As the oldest sibling in a home school family, I learned that lesson early but never as much as in the last two years. My church—sans any “revival” services or contest-like attendance drives—has recently seen about 300 people begin personal relationships with Jesus. That’s about 15-20% of the adult population in our assembly who are new believers from the ranks of atheists, addicts, and religious refugees.

The challenge for our leadership has been, “How do we disciple—nurture, guide, and grow—this influx?” The adopted solution for this “good problem to have” has been to match them with Christians who’ve been on the journey longer, even if only by a few months. We “big brothers” are to walk along side them, text/call/Facebook them, meet over meals, introduce them to new church environments—to invite them into our lives and just share our journey. I’ve got several big brothers reaching hands down on one side and several little brothers reaching up on the other.

This conduit style of ministry has drastically redirected my personal walk with Christ, as I’ve had to codify my operating principles and disclose my own spiritual junk. I’ve felt encouragement at the highest levels from newbies and accountability from both ends of the deal. My prayer life has changed, as I have to ask God to give me a plan to bless rather than to bless my plans. It’s been a sacrifice of time, money, and energy; but the intangible reward has proven priceless.

___________________________

VCAR 499 : Internship Paper
Liberty University
Garret Giesler

Not Exaclty Biplanes
04.15.09

Biplane Productions does not produce biplanes. Instead, Biplane owner and proprietor Ryan George spends his day making junk mail. You know, the advertising you pull out of your mailbox that says “to our neighbors at (insert your address here).” The garbage that sits on your counter until you open it, peruse it, then toss it in the trash. That junk mail. So what does a young, mostly inexperienced college student learn from a guy that makes trash all day?

I spent my semester working with Ryan George, a graduate of Pensacola Christian College, in his basement office. Ryan, creator of Biplane Productions, does full service design for auctioneers in forty states. His services range from simple newspaper “camera-ready” ads to complex 12 page brochures, presentation folders and more. More importantly, however, is his commitment to providing complete service to his clients.

Ryan markets himself as the premiere auction designer, and his work evidences this. As such, he offers everything an auctioneer would need to market his auction: he acquires mailing lists for direct mail pieces, he communicates with newspapers or magazines for advertisement placement, including ad sizes. He will even provide printing, without markup, through his friends at Shearer Printing.

Perhaps what makes Ryan so valuable to his clients is his speed and his knowledge of the industry. Ryan understands auctions and how they operate; he knows that his clients need a fast turnaround. He also is able to help auctioneers produce attractive marketing pieces without sacrificing vital information.

While working with Ryan, I was able to work on a number of projects, ranging from magazine advertisements to “live” auction brochures. “Live,” in this sense, means the piece is for an auction that is coming up. With these pieces, the designer only gets a few days to have it completed and make any requested changes. The piece must be sent to the printer by a certain date, because the material needs to be available to the targeted audience several days before the auction. All of these things mean you only have one shot to get it right: there is not time to provide the client with 3 concepts before fully developing one.

A lot of weight is put on web design these days. The average graphics position requires fairly extensive knowledge of web development and design, in addition to a thorough knowledge of print design, down to the details of how the piece will be formatted and sent to the printer. The average designer, then, needs to know print and web formats. I was fortunate that during my work with Ryan I got to work with a number of media. Obviously I did print, but I also created some web banner ads, and even some t-shirt and package design. Since the typical designer needs to know how to work with multiple formats, it was rewarding to get those experiences.

A surprising amount of organizing is required for the average designer, especially one like Ryan. One of my daily duties, when my projects were completed, was to work on organizing and databasing media information. This mostly meant taking current information about various newspapers, such as contact information and best day to advertise in them, and consolidating it into an easy to understand spreadsheet. In doing this somewhat menial task on a regular basis, I learned two things: first, there is a lot of thought that goes into ad placement in your local newspaper. As a designer, you need to know the column sizes, price per column inch (pci), which days are best for targeting your intended audience, and more. The second thing I learned is that sometimes, being a “designer” include doing some less than exciting work – from research to data entry to make future work easier.

Another duty that came later in the semester was the organization of sample artwork. Ryan mostly makes direct mail pieces, so when Ryan looks to gain new clients, he sends them samples of his direct mail pieces. He receives his pieces – those that have not been stamped and mailed – in bulk, and much of his “portfolio” of current work was jumbled in file cabinets. Part of my task was to organize it by type, such as 2 page brochure, 4 page, 4 page cover stock, 8+ page; I then grouped them by auction, so if one piece was effective he could quickly retrieve it and send it to a client. If a piece was not to his liking, or simply not his best work, he was able to throw it away without sifting through his good work.

I also organized his pieces that will be submitted to the National Auctioneers Association advertising contest. Ryan is an award-winning designer, with 40 national and over 50 state awards, plus an international award. Every year, offers his clients free entry to the competition. This service generally costs Ryan a significant amount of unpaid work, but it helps him and clients win awards. This year, I was able to help him by obtaining, grouping, preparing and mailing the entries.

Working with Ryan, I learned a plethora about how a design studio works, especially a smaller, freelance-like studio. The first thing I learned about being a professional designer is that you must be organized. Ryan is incredibly well organized, which is a significant part of how he juggles his dozens of different projects each week. While the average agency may have a month to complete the advertising and marketing for a client, Ryan has about two days. He also usually has multiple clients’ work on his desk at a time, and has to complete projects, sometimes based on date of the upcoming auction, rather than when the project came in. I learned that to keep up with multiple accounts, you have to be careful, organized, clear, and quick.

Another crucial element to having a career in design, especially one of freelancing or starting your own studio, is the importance of finding a niche. Initially, I approached design with a need to be diverse, to be able to do whatever is sent my way. While that can be good, it can be better to limit yourself. Ryan almost exclusively works for auctioneers. He does this because by finding his niche, he has been able to become one of very few agencies with a target market of auctioneers, few of which are able to provide high quality full service. By finding a niche, such as the auction market, you can learn the industry and familiarize yourself with its jargon. Simply put, if you get what your clients are talking about, you can be more efficient for both yourself and them. Also, the pieces that you create will be more relevant to your clients’ audience. Indeed, efficiency equals paycheck when you freelance or own your own studio.

Perhaps the most significant lesson I learned from Ryan is that there is a lot more to being a graphic designer than just doing design work. Graphic design is not about being exceptionally creative or expressive like traditional art forms. Rather, it is about exceptional communication. Design is by and large a commercial art form. What that means is that for your work to be effective, it needs to be more than just pretty. It needs to say clearly what is intended. Design and advertising are really inseparable here; every piece needs to be attractive, but more importantly it needs to serve its purpose. Ryan, who’s degree is actually in writing, compared the two. If someone writes a book, or a blog, or an article, the goal is for the piece to be read. If the piece is not read, it fails. Similarly, if a design piece looks good but does not elicit a reaction – such as purchasing an item, or whatever the goal was – the piece has not succeeded. Ultimately, commercial art must be created with the user in mind.

The design world is also evolving. If the designer just wants to design, he will have to compete with other designers and there is no guarantee that clients will return. While working with Ryan, we researched an article from Forbes.com; the article talks about CrowdSpring.com, a website that allows freelance designers to compete for work. The site, in brief, has clients put up rough specs for any design work they need. Designers then upload as many complete versions as they want – they do all the design work with no promise of payment. The client then chooses which piece they like the most, and pays the winning designer. The lesson from this is that if the designer wants to keep clients, the designer needs to be able to offer more than just good design. Otherwise, they will spend a lot of time doing unrewarded work.

The effective designer has a number of jobs beyond designing. Ryan showed me this through how he runs his business. On top of the obvious, graphic artists also have to be effective communicators. They have to speak with clients, with vendors such as printers, webmasters, or newspapers. They have to budget. This can mean time, as every designer needs to carefully manage their time, so as to stay on task and maintain efficiency and quality. Many designers, especially freelancers and owners like Ryan, have to budget finances too. Ryan has to calculate his clients’ marketing budget, and often has to figure in printing or publishing costs, and sometimes has to pay his vendors before he gets his paychecks. Since Ryan runs a business by himself, he has to calculate expenditures on a project to project basis for multiple accounts. He has to balance his accounts receivable and accounts payable; much of this kind of accounting work is not taught in art school. He also has to communicate with an accountant to make sure his numbers are accurate and legal. Ryan has to make sure his clients pay him, too, because he often has expenditures to pay off that were incurred by the clients, such as printing costs. He does this by sending out invoices and keeping track of who owes him for his services.

It is important to offer quality service to clients and customers, especially as the design world becomes more and more competitive. Mark Henricks, in the April 2009 issue of Entrepreneur Magazine, wrote that the number one growing sector in the US market is the service sector. There are many types of services, but being able to offer clients all the extras, such as coordinating newspaper advertising placement, brokering printing, and researching target audiences in addition to providing stellar design will make your value as a designer increase.

Ryan is a designer. But as you can see, there is a lot more than what meets the eye to a career in graphic design. A lot of the work that is required to be effective and efficient is not taught in school; indeed I count myself fortunate to have had the opportunity to work so closely with Ryan and to learn some of the less exciting but equally necessary aspects.

[footer]http://www.forbes.com/forbes/2009/0216/062_print.html. “The Creativity of Crowds,” Christopher Steiner, 02/16/09

“10 Sectors Poised for Growth”  by Mark Henricks, Entrepreneur Magazine, April 2009[/footer]

29: Making Your Advertising Work Harder for You

Article to be published (from assignment) in January 2009 edition of Auctioneer magazine.

Marketing DollarsIt’s been years since an auctioneer could simply post sale bills around town, fax some text to the local newspaper, and wait for scores of townspeople to stand in line to register at his auction. The dynamic of where and how consumers absorb media and shop change continuously. While your firm might not yet be wondering about cell phone advertising or PDA-adjusted web sites, you’re probably wrestling with the same essential question: how do I spend my advertising dollars for greatest impact?

Auctioneers have different needs than most service and retail companies. But we’re dealing with the same market factors as the next office down your street.

Newspaper advertising sales are projected to decline in the coming year for the second year in a row (the first time that’s happened since the Great Depression) and maybe by double-digit percentage.† Meanwhile, the Direct Marketing Association predicts that for the first time ever, online advertising spending will surpass direct mail expenditures in the U.S.†† So, options are increasing; and choices are growing more enigmatic.

Just don’t let the “analysis paralysis” stunt your efforts. If anything, keep doing what you’re doing and gradually add a new media outlet to the mix. Barry Baker, CAI, AARE, president of Ohio Real Estate Auctions, suggested, “What works well is to cover all of your avenues and spend money. You can’t shrink back on spending. Tons of electronic media, direct mail, news print, great signage. You never know which one is going to bring your buyer.”

Jennifer Bryant, principal broker for Counts Realty & Auction Group, agreed, “In order to get top dollar for any property being sold it’s imperative to spend the advertising dollars to get the property as much exposure as possible. Cutting corners on marketing may cost sellers thousands of dollars on sale day.” Bryant relayed that she has found web sites to be the easiest media to add to her advertising repertoires, seeing as their targeted audiences typically cost less to reach than older media formats.

If you don’t have the money to try new media outlets, you can shift your budgets toward your most effective media. To know how to cut or adjust, poll your bidders at registration. Be specific by media or even by specific media outlets (like which radio station or newspaper). It can be as non-obtrusive as, “How’d you hear about the auction?”

At one sale I helped advertise in a new geographic area for the auctioneer, the results to this registration question revealed that 75% of the bidders heard about the sale from the signs on the property and the story generated from the press release—which together accounted for only about 5% of the advertising budget. You still have to cover all your advertising bases, but a matrix of results like these over a broader sample of auctions will show you where to spend your largest portions of your budgets.

Using an ad agency can help you discover and manage new opportunities. Cammy Theurer-McComb, vice president of United Country Theurer Auction/Realty, attributes her switch to using ad agencies (she currently uses two simultaneously for different media) as “one of the best business decisions we ever made.” She added, “Outsourcing has been a relief, actually. And it brings a lot of consistency to our advertising.”

Consistency multiplies your media impact, as the connection between the various ad formats reinforces the others. The more consistent your materials, the more value each one holds. While ad agencies can make this easy, you can manage this process carefully without one, too. Jennifer Hope of Auction Ink recommended, “Create an identifiable visual image by using the same font, color, and general layout. There’s no need to recreate the wheel–find a look and stick with it.”

Carl Montgomery, CAI, AARE, of Comas Montgomery has seen consistency turn into residual returns. “The best advertising we do . . . is network television. We have been running on the local NBC, CBS & ABC affiliates for over ten years. Charlie, Dad, and I talk about our company and upcoming auction. Our tag line at the end of every commercial is ‘Let‘s Go Sell Something.’ Everywhere we go in Middle Tennessee people come up to us and say ‘Let‘s Go Sell Something.’ We have letsgosellsomething.com on tee shirts; and people ask what it means. We tell them to check out the site, which drives them straight to comasmontgomery.com.”

Keep your contact information uniform, too. Make your web site or phone number more memorable by including only one of each within any advertisement. If you absolutely need to use more than one, qualify each, so that the viewer will know why to call each.

Make sure you know why you’re contacting them, too. “Using a database [broker] like InfoUSA® really helped us target like-kind property owners,” divulged McComb. As her company expands into new geographic territories and diverse kinds of sale items—from antique toys to rock quarries—purchased demographic mailing lists have allowed them to send larger-impact direct mail pieces to a more concentrated audience. “That’s been HUGE for us,” said McComb.

Mike Schultz, CAI, president of Schultz Auctioneers, has also adapted to this strategy. Four years ago, his firm was posting Kinkos®-printed posters in community markets. Now, “Prospective sellers are coming to us with our own brochures, saying, ‘We want our property advertised like this!’ Well, we’re happy to oblige them.”

The residual affect of premium marketing can’t be overstated. Schultz concurred, “We’re spending more thought, creativity, and resources on every stage of the sales process. It’s giving us a competitive advantage over our regional competition.” This strategy has also drawn free local media attention from press releases, as in 2008 they’ve won Best of Show at their state association’s advertising contest and two NAA awards. “We’re investing in more exclusive brand positioning. It’s paying off—and not just in awards.”

So, there’s your answer: distribute consistent, premium advertising to more targeted audiences in as many media outlets as you can afford. Poll your bidders to evaluate effectiveness.

[footer]† “Next Year Is Looking Even Worse,” Stuart Elliott, NYTimes.com (December 8, 2008).
†† “Paying More, Getting Less,” Richard Levey, Direct (December 2008, page 8).[/footer]

×