The following is a guest post by author and entrepreneur, Matthew Lesko. To contact Lesko call 1-800-UNCLE-SAM.
Most entrepreneurs believe that if they could afford some big time advertising their business would be a huge success. But if this were true, why do all those high flying dot com companies who paid millions in Super Bowl ads a few years ago now find themselves out of business? The answer is that these companies who spent millions on super bowl ads only got real sales back in the thousands. Plain and simple, it was dumb business. You canâ€™t build a strong business by spending millions and getting only thousands in return. In fact, they probably would have never spent millions on super bowl ads if they didnâ€™t have that money burning a hole in their pockets. Please realize that sometimes having NO money can make you a better, stronger AND richer sales monger than if you had millions to begin with! Hereâ€™s why! If they didnâ€™t have that money, they would have acted smarter and found advertising that would pay off and made their business stronger other than losing a whole lot of money. I call this â€œegoâ€? spending, because, well, â€œyou canâ€?, or even because itâ€™s what they thought they are â€œsupposed to doâ€?! Spending money is easy. Making money is the hard part, but this is where the FUN starts! Hereâ€™s what I mean:
Advertising Is Only Worth What Some Idiot Is Willing To Pay For It
But it may not be worth it to you. If youâ€™re a small business, why pay for high priced advertising that is sought after by big companies who spend ad dollars for reasons you and I will never understand? Big companies may be buying for branding, visibility, or whatever. Most small businesses need to advertise for sales and sales only. You spend a dollar, and you should want at least a few back! Anything else is academic and should be saved for discussions in marketing classes at Harvard Business School.
The â€œEtch-A-Sketchâ€? Ad Rate Card
Remember the â€œEtch-a-Sketchâ€? toy that looked like a tablet with knobs you turned to draw on it, and when you wanted to â€œstart overâ€? your just shook it up and WHAMâ€¦ â€œDO OVER â€“ CLEAN SLATE!â€? Advertising rates are a lot like that. People who sell advertising put their prices in print and make you believe they are set in stone but they are really on â€œEtch-a-Sketchâ€?. If someone is willing to pay full price the ad companies will get the full price, but if no one is willing to pay that price, itâ€™s not worth the full price and theyâ€™ll be willing to take a lot less. The media needs a certain amount of ads at almost any price. They need ads to fill in around the programming. TV and radio stations are not going to broadcast less hours a day because they donâ€™t have enough full price ads to fill in and web sites are not likely going to take out some web pages if they canâ€™t get 100% full price ads. The people selling advertising are likely to take a lot less money for their space if they donâ€™t have someone with deep pockets wanting it. Remember: big pocket guys canâ€™t buy everything. But people selling advertising wish they would.
Your Offer Could Be The One They Canâ€™t Refuse!
Hereâ€™s were you come in and do some magic. You make an offer. But you do more than make an offerâ€¦ Tell them youâ€™ll give them a copy of every size ad they will ever possibly need so they can have them on hand to use at the last minute when space does not sell or ads are pulled at the last minute. All you ask is for a 50% discount to make it work for you. If they say no, tell them that you will send them copies of your ads, or â€œcreativesâ€? anyway, just in case. Tell them they donâ€™t have to ever use them, but there may be times when they will feel that 50% of something is better than 100% of nothing.
In the fast changing world that we live in today, what someone thinks they canâ€™t accept today may change OVERNIGHT! It may even change in an hour or so, but if they donâ€™t have your ad, you canâ€™t take advantage of the opportunity. BE READY and PRO-ACTIVE! Opportunities rarely happen twice. You have to be pre-prepared to take advantage of them.
The Best Rate Is A Percentage Of The Sale
This is how I made a whole lot of money. Frustrated at not being able to make money on TV, radio or even the web by paying what people asked, I started thinking about why I make so much money in book stores and not other places. The answer was that bookstores take 50% of the sale and donâ€™t ask for any money up front. When a bookstore sells my books I get 50% of the money. I donâ€™t send anybody else money for profit sharing, I just have to have my own â€œproductâ€? available and ready to ship. But when I purchase advertising, I have no idea if it will lead to a sale until after I spend the money. So I started offering people 50% of the sales instead of 50% of the cost of advertising. This allowed good stations or sites to even make more money than if I purchased the advertising. But it eliminated all risk for me. And, actually, I see it as, I believe in my books and products, and the â€œvendorâ€? believes in their store, site, or advertising! Good deal!
I know that I donâ€™t know someoneâ€™s market as well as the one who developed it. So, if they believe their audience will purchase my product they can easily make money by selling my product.
Sure the things I talk about above wonâ€™t work all the time. But in our world nothing works all the time. At my age I am aware of that more than ever, and itâ€™s not always easy to arrange. But it is possible, and Iâ€™ve made millions of dollars doing it and would have never been as successful in life as I have been if I accepted the prices that were on the advertising rate card, OR what others told me the â€œindustryâ€? needed or what â€œothersâ€? do in business.
Thatâ€™s why I believe â€œAnybody Can Spend Money On Advertising But Real Entrepreneurs Donâ€™t Pay Rate Card, And If Theyâ€™re Real Clever, They Figure Out A Way Not To Pay Anything Up Front At Allâ€?.
Matthew Lesko’s newest book is Free Money For Entrepreneurs.