Why waste your Advertising Budget?

January 19, 2009 - Issue 2

Has your advertising manager made the statement: “I know half my marketing dollars are wasted...I just don’t know which half”? Did you fire that employee or vendor on the spot? You should have.

Advertising and marketing have often acted like they have an open checkbook and without any supervision. Advertising and marketing can move mountains, but it requires planning that can be executed by the marketing department.

You and your executives have crafted strategy and vision for your organization but you rely on your management team to integrate departmental plans to achieve your corporate objectives. Planning is critical to reach your marketing goals; not that the resulting plan is critical, rather the process of planning is critical.

Managers must think about what has happened, what is happening and what might happen. Goals must be set and agreement achieved. The goals must be communicated to the entire organization. Progress towards goals must be measured. Corrective action must be taken overcome obstacles when goals are missed.

Marketing departments and vendors often circumvent the planning process by preparing high level marketing plans; but marketing is more complicated and important than “Cliffs Note” marketing plan which focus upon short-term goals and lacks marketing specifics.

Advertising expense should be viewed as an investment. Gone are the internet bubble companies whose only value was generated by their Super Bowl commercials: Do you remember Pets.Com? Advertising takes multiple exposures and meaningful messages to generate viewer recall. Overtime, advertising impacts the market landscape and is more powerful and cheaper than direct sales.

Marketing plans should be simple and easy to use. The best plans are brief and provide goals, strategy and plan costs. The basic templates for marketing plans contain:

• Situational Analysis
• Marketing Objectives and goals
• Marketing strategy
• Marketing action plan
• Marketing controls

The situational analysis section includes description of the current situation, SWOT (strength, weakness, opportunities and threats) analysis, issues and assumptions. SWOT analyses are often used, but how comprehensive is your organizations? The following table contains a generic checklist that organizations find useful for understanding their current market. The checklist can easily be customized to any organization.


Checklist for Performing Strength - Weakness Analysis

Objectives and Goals:
Advertising objectives and goals are critical to measuring your marketing investment. Executives and marketing managers need to understand what the company’s target is and advertising’s role. Objectives are broad and focused on the current period and long term objectives. Objectives are increase margin, customer satisfaction, company’s value, etc. The objectives must be feasible and internally compatible.

The critical factor separating success companies from mediocre companies are goals. It is critical that management have tools to gauge exactly how marketing/advertising is performing. Goals are measurable and hold advertising accountable. When executives start measuring advertising, you hear comments such as “I know half my marketing dollars are wasted…” Commissions are earned based upon measurable sales….

Strategy:
The company now has to determine the best path to achieve its marketing/advertising goals and this is accomplished through strategy. The components for marketing strategy are:

• Defining the Target Market Company’s Core Positioning
• Price Positioning
• Company’s Value Proposition
• Distribution Strategy
• Communication Strategy

Action Plan:
Now comes the hard part; the company must translate the goals and strategies into concrete actions which requires actual work to occur. All the talking now stops and work must be performed to implement the actions. Action plans not only have dates and activity for launching new programs; it also includes monitoring performance and communicating results to key players.

Control:
The company has invested in marketing and expects to achieve results. The plan must include a mechanism for reviewing and assess performance. Last month, I presented a Marketing Scorecard model and this could be the tool your company uses to control your marketing investment. Remember, management must take corrective action when goals are not met.
Your senior management team has reviewed and approved lots of plans, but how can you be sure that your marketing plan contains good marketing principles. It takes real marketing experts help establish a common planning framework. CMG~SRG is an organization that can help. Our marketing team contains experts and we can help identify and leverage the 50% of wasted advertising dollars.

Remember, http://www.yoursrg.com/ promotes living communities via our Display Pages. Yoursrg.com attracts over 500,000 visitors each month and these are visitors who are looking for senior living solutions. The following link takes you to an Omaha display page example(http://yoursrg.com/listing/43119/Arboretum-On-Farnam-Drive.aspx).

Hurry to take advantage of our $25.00 Display Page promotion!

Thank you for your time and contact me with any questions.

Tom Chappelear
CMG~SRG
mailto:Tom.chappelear@cmginc.com?subject=Marketing
402-292-1135

Senior Marketing Measures

Issue: 1 December 22, 2008

The demand for senior living communities has been impacted by the financial events this fall. The need for senior housing, driven by the graying of the America, will continue; however it will be many quarters before we see growth rates equaling those of the past decade. Seniors are cautious and the getting them to commit to long term contracts will be difficult.

I know that your advertising representatives have told you that selling to seniors during the past decade has been difficult; but the reality is that demographics have been on the seller’s favor. Senior consumers have gone to great lengths to find your services and properties while sales have found that overcoming objections has been relatively easy.

Have you prepared for a buyer's market? A market where you (as the seller) seek leads, qualify prospects, manage the sales process, and then close the sale. In addition, you will have to develop marketing programs just to gain brand name recognition. From my experience, senior living communities are NOT prepared for a buyer’s market. Most communities have no concept of the work that it takes to attract prospective residents.

If you are one of the few who are ready for a buyer’s market, congratulations. But most senior companies do not have a comprehensive marketing to survive difficult times. Let me prove my point…Please answer the following:

• What role does advertising perform in attracting prospects?


• What is my company’s position?


• What strategies and tactics do we use to communicate to leads?


• Once we have contacted a lead, how do we continue the communication process?


• Have you ever audited your marketing program?

The answers that most communities give to these questions demonstrate that they do not understand marketing and controls used to manage the function.

Companies who have implemented a comprehensive marketing strategy will prosper; but the vast majority who do not have a marketing strategy will complain about the poor market and lack of qualified prospects. These companies will cut sales and marketing, staff, office, and maintenance expenses to maintain short-term profitability; however, these actions will damage their reputation and long-term viability.

Market Focused Communities

The correct response is to review your marketing program and gain control of your marketing program; In other words: control your message. This correct response is critical because your most important assets – your people, your reputation, your brand, and your customers – are not quntified on your balance sheet (Ted Levitt). Sadly, most companies will cut these assets and damage their company during these tough times.

Successful companies (including senior living communities) set performance goals, create scorecards and constantly work to identify and correct measures that will help manage their community. Marketing Scorecards include measures to trigger concerns about future prospects, current prospects, generate sales, customer satisfaction, and service quality.

A company’s Marketing Scorecard is developed to reveal the fundamental health of the company. The Marketing Scorecard should become the must read report for marketing, sales and senior management. The results need to be evaluated and interpreted to analyze marketing effectiveness and develop action items to improve weak components.

Exhibit A shows a marketing scorecard example for the senior services companies to reveal how marketing expenditures impact the company’s fundamental health.

Exhibit A
Marketing Scorecard

The Marketing Scorecard is a template developed to enable senior living communities to analyze their marketing effectiveness. The measures can be customized meet corporate or community needs. A Marketing Scorecard requires facts based on activity and research; otherwise the scorecard becomes subjective which limits its value to management.

Market Overview: The goal for this section is to measure the number of qualified prospects attracted and sales effectiveness in closing. A community whose census numbers are strong may have a low close percentage but the community’s marketing goals will help put the contrast into context.

Satisfaction: We recommend that communities use a five point scale: Very Dissatisfied, Somewhat Dissatisfied, Indifferent, Satisfied and Very Satisfied. The level of satisfaction questionnaire should measure each component of the community’s offering, not just an overall basis. The communities must learn the causes of satisfaction and strive to exceed satisfaction.

Quality: Management will understand the community’s quality when compared to peer and new communities. This relative quality measure will enable a community to separate itself from other communities and may help improve profitability.

CMG~SRG is a marketing company committed to advancing the messages senior communities seek communicate. We have developed publications, interactive multimedia, marketing services and web tools that enable senior marketing companies the tools to achieve their goals.

Last week, we kicked off our Display Page discount offer. The response has been strong and we will continue this opportunity for you to promote your community. $25.00 to populate your community’s web page on www.yoursrg.com.

Thank you for your time and please contact me with any questions.

Tom Chappelear
CMG~SRG
Tom.chappelear@cmginc.com
402-292-1135