I was taught: Earn your keep. From a very young age, I had chores, I had work to do. When I discovered there was pricey coffee made from cat poop being sold—a demonstration included in my book No B.S. Price Strategy—I sat the dog down for a discussion! Having everybody and everything earn their keep is deeply ingrained in me.
Anyway, most of us try to hold people accountable for assigned tasks, but a lot of businesspeople aren’t as tough on the dollars they put to work in advertising and marketing. In the boom of 2006–2007, money streamed uphill. If you were once casual or deluded about waste or lack of accountability in advertising and marketing before, it’s now the luxury you dare not afford. In fact, in 2017 and 2018, we are in the midst of a collapse of the midrange consumer and witnessing the fast shrinkage or destruction of a number of retailers, department store chains, restaurant chains, and other kinds of businesses dependent on those consumers. Some of the cause is Amazon, but not all of it. One thing is certain, waste of anything—a dollar, a lead, a potential customer, a customer—is no longer affordable.
This is about demanding performance.
As the leader of your business, you must do exactly that.
There Will Be Tracking, Measurement, and Accountability
You are no longer going to permit any advertising, marketing or selling investments to be made without direct and accurate tracking, measurement, and accountability.
You will be given all sorts of arguments against such a harsh position, by media salespeople, by online media champions talking a “new” language of “new metrics” (see page 89), by staff, by peers. You will smile and politely say, “Rubbish.” Each dollar sent out to forage must come back with more and/or must meet predetermined objectives. There will be no freeloaders; there will be no slackers.
This is now particularly vital with online and social media. Some of it is ad media pretending to be something else. Much of it is wrapped in its own deliberately confusing means of evaluation—likes, views, time of views, viral, etc. In 2017, Facebook was exposed for misreporting and exaggerating views and numbers of minutes viewed for advertisers’ videos. Widespread inflation of activity at all sites by “bots” and “fake activity farms” became known. None of this negates use of it, but it should inform your firm insistence on clear, accurate measurements for return on invested money and time in such media, just the same as for all media. You will be told it’s different, but always remember you don’t get to spend different money or different hours on it.
There are two reasons for holding all media harshly accountable.
First, because management by objectives is the only kind of management that actually works. When an NFL football team takes the field on Sunday, there are team objectives—not just winning, but for ingredients of victory that can be measured. Each player also has individual, measurable objectives that he and his coaches have discussed before the game and will evaluate after the game. So it should be when your team takes the field. Your team includes people you pay as well as marketing you pay for. You can’t manage what you can’t, don’t, or won’t measure. Vagueness must be banished.
I can tell you as ironclad fact that of all my clients, past and present, the richest and most successful, the ones who build the best businesses, “know their numbers” better than all the also-rans. For a full discussion of the “money math” of business, I’ll refer you to Chapter 43 of my book No B.S. Guide to Ruthless Management of People and Profits, 2nd Edition. That book in its entirety is an excellent companion to this one, and specifically to this chapter.
The second reason for direct measurement is that you need real, hard facts and data to make good, intelligent marketing decisions. Making such decisions on what you and your employees think is happening, feel, have a sense of, etc., is stupid. And you don’t want to be stupid, do you?
So, let’s talk about tracking response. This means collecting as much information as you can, which is useful in determining what advertising, marketing, and promotion is working and what isn’t, which offer is pulling and which isn’t. Admittedly, this can be a bit tricky. For example, Ad #1 may pull in new customers at $122.80 in cost and Ad #2 at $210.00, so you might decide Ad #1 is the winner. But the average first six months’ purchase activity of those coming from Ad #2 is $380.00; the average from Ad #1 only $198.00. Now, which is more productive? Further, 30% of those from Ad #2 may refer others, while only 10% of those from Ad #1 refer. Now, which ad is better?
Resource Alert!
This book is the solid foundation for conversion of any ordinary business to a direct marketing business. There are specialized next-steps marketing books:
No B.S. Guide to Marketing to Leading Edge Boomers and Seniors
No B.S. Guide to Trust-Based Marketing*
*Ideal for financial, health, and other professionals; for high-transaction sales professionals; and for consultants.
The companion book to this one for management of a direct marketing business is:
No B.S. Guide to Ruthless Management of People & Profits, 2nd Edition
All are available at Amazon, BN.com, Barnes & Noble, and other booksellers. Additional information about many No B.S. books is at www.NoBSBooks.com.
Do not dare shrug this off as too complicated. Think. Set up systems to capture the data you need and set aside time for the analysis. If it’s painful and confusing at first, the fog will clear, the difficulty will abate. You will make discoveries that enable you to make better decisions, better allocate resources, create better marketing messages, and grow your business without simply growing the marketing budget proportionately. In a mature business, this is how profits can be grown without growing revenue.
Warning: employees can often be an obstacle to accurate tracking, sometimes out of laziness, sometimes stubbornness, sometimes for more Machiavellian motives, such as concealing their own ineffectiveness. If there’s been little or no tracking until now, there will naturally be resistance to the added work and to the revealed facts.
As an interesting example of what can be revealed, consider a company I did some consulting for, with complex advertising and marketing bringing prospects to offices for one-to-one sales presentations. The salespeople were inflating their closing percentages with cooperation of the receptionists, under-reporting the number of appointments occurring. When I instituted a gift with appointment into the marketing, the salespeople suddenly had to requisition the needed number of gifts for the appointments they took. Bill could no longer claim he was closing 6 out of 10 when he was really closing 6 out of 20 now that he needed 20 gifts. Of course, the salespeople quickly claimed that giving the gifts was bringing in poorer quality prospects, but a controlled test of another kind firmly disproved that. The really awful thing in all this for the business owner was a lot of prospects he’d paid to get were coming and going invisibly, thus no follow-up on prospects who failed to buy at first attempt was occurring. Installing an effective, multi-step follow-up campaign comprised of direct mail, email, and, finally, phone, added over $1 million in revenue the first year.
One more example. A chain of stores with advertising that produced a lot of walk-ins had in place a process whereby the clerks were to ask everybody which ad in which media had brought them in, and stick-count it, day by day. Unfortunately, this was subject to an enormous amount of “slop.” Employees didn’t ask and randomly added to the count in different categories or put a lot of numbers in “Misc.” A change was made, giving visitors a little survey card to fill out, pushed by huge in-store signage, entering them in a weekly drawing for good prizes—and suddenly, a lot of accurate data materialized, very contradictory to the data that had been collected or, often, just made up by the staff.
If you loop back and connect this to Rule #1, you’ll find an important key to tracking: offers. Different offers can be made in different media, to different mailing lists, at different times. Offer and promotional codes can be assigned to coupons, reply cards, surveys, online opt-in, response, and order forms. Big direct-response advertisers on radio like Lifelock and Boll & Branch tie promotional codes to different talk radio hosts, which the consumer enters at the website to secure a discount or gift, often as simple as entering the host’s name: Rush or Glenn or Sean. The internet also offers the local merchant an opportunity to force better tracking. Pre-internet, a local restaurant advertising on several radio shows and in a couple newspapers, giving away a free appetizer with dinner, could only try to find out which ad brought a customer in by having the customer tell the waiter or waitress in order to get the free appetizer, and relying on the wait staff to accurately stick-count and report that collected information. Now the consumer can be driven to a different, clone website to download a coupon for the free appetizer, the coupons collected and tallied, and a much more accurate result obtained—plus the added benefit of capturing the names and email addresses of those visiting the site, and maybe offering online reservation-making options to the consumer as well.
Tough-minded management of marketing (and of people) requires knowing things. Of course, hardly any tracking mechanism is perfect. The job is to get as close to perfect as you can so that you are getting the best information possible.
The great GKIC member marketers behind the fast-growing national franchise organization, Iron Tribe Fitness Centers, featured in the book No B.S. Brand-Building by Direct Response, gave a presentation to one of my mastermind groups they participated in, of their new “branding campaign”—and as they introduced it as such, a collective groan was emitted by the other coaching group members. They all know better! And they were all confident that I would react badly to a brand-oriented ad campaign and marketing program. But not so in this case, because these smart guys incorporated Rule #4 throughout the entire campaign. Tracking by separate phone numbers, domain names, or promotional codes was built into every item, every media used, every step of this campaign. Also, they obeyed Rule #5, so they weren’t actually buying the brand-building. They were letting direct response pay for it. They are exactly right in their approach, they are a stellar example everybody should look at (regardless of the industry you’re in), and, because they get this, they are a force to be reckoned with in their industry—where, frankly, really horrible advertising is the norm.
I am not opposed to brand-building, nor would I argue against the influence, power, and value of brand. Quite a few of my clients have built powerful mainstream brands, including Pro-Activ®, HealthSource (400+ chiropractic clinics nationwide), and High Point University; niche brands famous in their respective industries and fields, like The Scheduling Institute (in the dental profession), Advisors Academy (with financial advisors), American Gunsmithing Institute (with gun hobbyists), and many more. But none of them have bought their brand recognition in the traditional way.
My own business is connected to brands—my own name, me, myself, and I. Dan Kennedy is a brand well-known and well-respected in entrepreneurial and marketing environments. Go Google me and see all you can find. The “No B.S.” brand attached to this very successful book series, published by Entrepreneur Press, also extends to five successful newsletters, a full catalog of resources (GKIC.com/Store), and stands as positioning for GKIC. GKIC is fast developing The Renegade Entrepreneur Movement® as an extension of my Renegade Millionaire brand. Again, none of this identity and target market brand recognition has been bought or obtained by patient and hard-to-hold-accountable spending. It has all come as, essentially, a free bonus provided from direct investment only into direct marketing.
By the way, you can create brand power for even the most mundane of commodities. Coca-Cola branded water—Dasani. Victoria’s Secret branded undergarments. Omaha Steaks—steaks. Hale Groves Grapefruit—grapefruit. Dasani Water is an off-shelf product. Victoria’s Secret, retail. Omaha Steaks and Hale Groves are direct marketers, mail order, and ecommerce.
I am not opposed to brand-building.
I am opposed to paying for brand-building.
Most small-business owners cannot afford to properly invest in brand-building. Most start-ups lack the patient capital and luxury of time required by brand-building. I do not believe it is a wise investment for small-business owners and entrepreneurs, nor do I believe it is necessary. Brand power can be acquired as a no-cost byproduct of profitable direct-response advertising and direct marketing. My preferred strategy is simple: buy response, gratefully accept brand-building as a bonus. NEVER buy brand-building and hope for direct response as a bonus. (Unless you are actually trying to spend Daddy’s fortune out of spite.)
Paying for traditional brand-building may be fine, even essential, for giant companies with giant budgets in combat for store shelf space and consumers’ recognition. If you are the CEO of Heinz or Coors or some company like that, playing with shareholders’ money, and fighting it out as a commodity purveyor, by all means buy brand identity. But if you are an entrepreneur playing with your own marbles, beware. Copying the brand-builders can bankrupt you. You should also take note of really big brand-name companies that are advertising brand, but also aggressively and directly asking prospects to go to a website or call a phone number, like GEICO and Progressive in insurance. This direct lead flow is paying for the advertising, with the contribution to brand recognition as a bonus. A relatively small percentage of brand-name advertisers know how to do this well, so you have to be very careful about who you model.
It’s also worth noting that there’s no guarantee of success or sustainability with widespread brand recognition and brand equity. Some once very famous and dominant brands are, today, badly tarnished, shadows of their former selves, or dead. In the motel industry, the leading American brands were Holiday Inn and Howard Johnson’s. Pontiac was once a leading car brand in the GM portfolio, and for a time, Rambler was the brand that stood for reliability, and Rambler dominated the station wagon category. More recently, Borders was one of two top brands in bookselling. Some of the brands you know and perceive to be dominant leaders in their fields and product categories today will be diseased or dead within ten years. The graveyard of once-powerful brands is big, and welcomes new arrivals frequently. Any idea of inevitability of an established brand is foolish and dangerous conceit. Consider SEARS, once the Amazon of its era, and the dominant all-goods retailer, and once one of the best-known and trusted brand names. None of that guaranteed its permanence.
Why, When, and How to Do UN-Branded Advertising
There is a case for ignoring branding altogether, entirely or situationally. What I am about to reveal here is a very, very powerful advertising and marketing strategy well-known to Direct Marketers but largely ignored or misunderstood by all others. It is the deliberate use of nakedly un-branded advertising.
What you never want to do is let brand-building get in the way of the most powerful and profitable advertising and marketing opportunities to grow your business. There are many types of direct-response lead generation ads, designed to motivate qualified prospects for a particular product or service to step forward, identify themselves, and ask for information, which work much better “blind,” absent any company name or logo or branding, than they do with identity disclosed. One version is the now classic “Warning” ad:
Warning to Mutual Fund Investors
Expert Predicts Dramatic Change and Danger in the Next 29 Days.
This Is Information You MUST Have—That Brokers Don’t Want You to Know. For Free
Information and “The Wall Street Secrets Report,” call the Fund Investor Hotline at 1-800-000-0000 or go online to www.SecretsHotline.com
You absolutely kill that ad’s pulling power if you attach a big, fat logo, a national brand name, or a financial planning firm’s name and slogan to it.
In this category, in financial and investment information publishing, one of the all-time biggest successes was a campaign that dominated print, radio, and cable TV in 2011 and 2012, driving traffic to an online video at EndOfAmerica.com. (You can probably still see it via YouTube.) This ad was aired, seen, and heard so much, the domain name itself nearly had brand identity, but throughout, neither the company nor its brand, the newsletter ultimately being sold, the author, or any other identity, corporate or personal, was disclosed in the advertising. It was completely “blind.” I am told it broke all subscriber acquisition records of its company and probably the industry, bringing nearly a million new subscribers into the fold. Incidentally, as a side point, the online video was 90 minutes long, so let that stick a dagger in the persistent and erroneous beliefs about short viewer attention spans and/or need for short copy. The point: zero brand-building was attempted. But if in the hands of most big, dumb companies in publishing, insurance, annuities, gold, or other financial goods and services, they and their nincompoop ad agencies would have insisted on mucking up the ads with their corporate names, logos, slogans, years in business.
You can always brand-build internally with customers once they are acquired. There’s no law that says you can’t create powerful brand identity and preference with customers, yet never even mention it to new prospects.
There are even instances where a brand suppresses response because of its virtues. I have, on more than one occasion, had clients in niche markets who had become very well-known and well-respected, and if you asked 100 people in their market about them, nearly all of the randomly chosen 100 had generally positive things to say about the company, but could also rattle off the five key components of that company’s sales story and offerings. No mystique, no curiosity. A been-there-heard-that-done-that-before problem. Success came by trotting out “blind” advertising and marketing with fresh promises and bold positioning, which would have been instantly discredited if voiced by the venerable, old industry leader. Then, once interest in the promises was created, information could be provided that revealed the match of the biggest, most respected brand with the hot, new, daring products.
In short, brand is not necessarily the holy grail. Brand-building is best for very, very patient marketers with very, very deep pockets filled with other people’s money. You are likely far better served by focusing on leads, customers, sales, and profits directly driven by your marketing, letting whatever brand equity you get be provided as a free byproduct of direct marketing.
Interview with Rick Cesari: Brand-Building by Direct Marketing
Rick Cesari is the author of a must-read book on direct marketing, BUY NOW: Creative Marketing That Gets Customers to Respond to You and to Your Product, based on his extraordinary experience bringing products like The Juiceman, the Sonic Toothbrush, and The George Foreman Grill to market.
KENNEDY: Monster successes like those you’ve shepherded never begin that way. They begin with proving we have something to sell and proving we can craft a message that people will respond to, starting by playing small ball. I’d like you to talk a little bit about the way you started these businesses, such as The Juiceman.
CESARI: We started The Juiceman business in 1989, and in 31/2 years we grew the sales from zero to $75 million. I found Jay Kordich, the inventor and personality of The Juiceman, at a small, local consumer show. 10′ × 10′ booths, people selling products. All the booths had one or two people, but this one booth had a crowd, 50 people gathered. Jay was there, talking about the health benefits of juicing, demonstrating his machine, and he had people captivated. I talked with him and found out he was living on the road, working these kinds of shows, state fairs, that sort of thing all over the country, selling a lot of juice to groups. I’d already been in the direct marketing field a long time, and I was sure that we could take what he was doing on this small level, move it to media, and build it into something a lot bigger.
KENNEDY: I think it’s important I point out: Jay had a small business, reaching small numbers of customers, by successful direct selling. With direct marketing, you could basically multiply him with media. The reason I push owners of businesses thought of as ordinary to move away from traditional marketing to direct marketing is that they can multiply what they do successfully one to one into one to many with media.
CESARI: That’s right. But we didn’t run out and make TV infomercials immediately. We made calls to get Jay booked as a guest on local radio and TV shows to talk about health and juicing. Our first breakthrough came on a New York station, on a local morning show hosted by Matt Lauer, who now, of course, is a Today Show host. Jay was on for 20 minutes and told people if they would send in an envelope with a dollar, he’d send them recipes. I was told that the station switchboard lit up, but this was before the internet so everything happened through the mail, and it took a week before we saw the result. He was on, on June 30th. On July 6th, the mail truck pulls up, and the mailman brings in three canvas sacks. Twelve thousand envelopes with dollars in them. We sent out a flier selling juicers with those recipes and that’s what started this business. We used that strategy, got Jay on show after show after show. We also started using those interviews, then our first infomercial to get people to come to free health seminars, where Jay would sell from the stage to hundreds and hundreds of people at a time.
KENNEDY: Let’s be sure everybody gets that there is architecture here that does not go out of date. This doesn’t have an expiration date on it.
CESARI: This model still works, although we get to add the internet, we have more marketing tools—but direct marketing from more than 25 years ago with The Juiceman and the direct marketing we’re applying to our latest projects is the same.
KENNEDY: The next question goes to Message. Many businesspeople think that their products, services, or businesses are ordinary, they complain about commoditization and competition, and they just can’t see how what you’ve done and do, how what they see with products sold direct in infomercials, in direct-mail packages, applies to them. When you think about, basically, a blender, a countertop grill, a toothbrush, it’s hard to be more ordinary than these products, yet you take them to direct marketing, and turn them into multimillion-dollar brands, and move them successfully to retail where they sell off the shelf. Let’s talk a bit about this turning the ordinary into something very saleable and very exciting to the public—and let me emphasize the requirement of making whatever you offer, sell, do exciting to the public. You just can’t afford to accept the idea that your thing is doomed to be ordinary and uninteresting, can you?
CESARI: You have to look at products in a different way. In 1989, there were a lot of juicers being sold, but they belonged to appliance manufacturers and were being sold conventionally as kitchen appliances. The twist we put on it with Jay was to make it a health device, not a kitchen appliance. We never talked much about the blades or motor or size of container. We pushed the information booklets, the immune strengthening diet, the weight loss juice diet, anti-aging. When we brought the Sonic Care Toothbrush out, there was one other premium priced electric toothbrush sold through dentists, but there were quite a few sold to consumers for a few dollars. Sonic Care was $150.00. How to sell a $150 toothbrush? Nobody understood or cared about sonic technology. So we made our message about reversing gum disease, preventing heart disease, etc. With the George Foreman Grill, there were a lot of little grills, and it was actually originally a taco maker—it’s slanted the way it is to slide the ground beef into the taco shell. Not surprisingly, it wasn’t selling. We determined you could drain the fat and grease that way, and with George Foreman, made it about “Knock Out The Fat.” Again, a health device, not just a kitchen appliance. There have been more than 30 million George Foreman Grills sold. We believe there is always a unique benefit.
KENNEDY: This is one of the differences between the way most businesspeople and marketers think versus the way we direct marketers think. They look to the product and its features for benefits to talk about. We want to be storytellers. We look for the hidden benefit, for the benefit that matches up with consumers’ life issues and interests.
Excerpted from and based on an exclusive interview with Rick Cesari for the monthly GKIC Diamond Members’ Tele-Seminar & Q&A Conference Call. For information about GKIC Membership featuring my No B.S. Marketing Letter/Dan Kennedy Letter, refer to page 229.