The Marketing Mindset
Imagine Holly sells handbags, scarves and jewelry on a busy street in a big city: “Holly’s Handbags.” Her competitor’s stores are all around. The city charges her $500 to put a sign-board on the sidewalk.
As a marketer, she could judge the quality of the pitch on the sign-board by how many people it draws into the store. Creative ways of attracting crowds would be shrewd practice. The sign could pitch her wares and “Unbeatable prices”, or “Today’s special”, or heck even magic tricks at the back of the store as ways to encourage folks to browse. Clever signage could become part of her brand and something that distinguishes her from her competitors.
The $500 is a fixed cost; the more people she brings in with it the better, even if they may not be interested in what Holly sells. Who knows, maybe one of those people looking for shoes will see a purse she can’t live without. Low probability, but who cares? After all, it doesn’t cost Holly anything extra to bring them in.
Now imagine that instead of the sign-board Holly has 500 $1 dollar bills. She gives them to people in exchange for stepping through her doorway. This changes her strategy considerably. Holly needs to be judicious in who she pays to walk in. The person looking for shoes is welcome to swing through, but Holly surely isn’t going to give her a buck to do so given that the prospect is looking for something she doesn’t sell.
That person who’s walking down the street stopping to peer in the window of every handbag store…maybe that’s someone worth the investment…particularly if they have the right look about them: not homeless, not criminal, maybe wearing styles similar to Holly’s accessories. The person walking down the street asking strangers: “where can I find Holly’s Handbags” poses an interesting dilemma; it’s certainly worth a dollar to have her come in, but it’s also pretty easy to make the case that Holly might save a dollar by just letting her walk in on her own.
Using the dollars judiciously, not indiscriminately, will generate a solid return on investment.
The sidewalk sign is a much better vehicle for brand-building. Thousands of people will see the sign every week; there’s great room for creativity, and the cost per thousand impressions is relatively small.
Paying for visitors, on the other hand, may generate great return on investment if the dollars are spent wisely, but aside from creating happy, hopefully loyal customers, it’s an awfully expensive mechanism for showing off your brand. A $1,000 CPM would scare off most brand marketers, almost regardless of the quality of the impression.
The fact that a hammer and a screwdriver are both valuable tools for a builder doesn’t mean they’re interchangeable.
Some marketing channels are better than others for brand building. Some are better than others for driving immediate return on investment. The key is to find the right mixture of approaches.