July 11, 2002

Does Advertising Really Work?

A friend and business owner who received a recent newsletter asked, "What's this obsession you have for marketing without advertising? I advertise and it works just fine. I'm too busy to experiment with other things that may not work as well as advertising."

I suggested that he think about some numbers. The average consumer is drowning in a flood of advertising that costs companies more than $200 billion/year or about $720 per American. Recent studies indicate that the typical American is barraged with over 10,000 commercials a week through radio, television, direct mail, telemarketing, newspapers, magazines, billboards, and the Internet.

To break through this clutter, many advertisers have reverted to desperate attention-grabbing measures such as shooting gerbils through cannons (the now defunct Outpost.com) or equally annoying tactics such as cranking the volume higher on television commercials. It's no wonder that consumers are retreating in unprecedented numbers to commercial free cable television like HBO and Showtime, video rentals, video recording that allows skipping through commercials, and streaming radio.

Other businesses make hyperbolic claims that they serve the best this or that. Or, they try to entice the consumer through the use of loss leaders such as advertising a 25% off sale but actually only putting a very select number of items on sale. It's hardly surprising that a University of Illinois survey found that 47% of all Americans said that most advertising insults their intelligence and 52% of Americans said that they think advertisements generally cannot be trusted.

If you're spending big dollars on advertising, you need to ask yourself, "Does it really work?" James Twitchell in Adcult USA (Columbia University Press, 1996) answered this question best when he said, "Although elaborate proofs of advertising's impotence are available, the simple fact is that you cannot put a meter on the relationship between increased advertising and increased sales. If you could, (advertising) agencies would charge how much they have increased sales, not by how much media space they've purchased."

If not advertising, what does work best to bring customers into a business? Next week, I'll address this question and it may just get you to shake up your marketing budget.

Best wishes,
Patrick Galvin