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Advertising’s Compound Interest

By Jim Gustafson

Every business owner dreams that advertising in a certain medium will net them dozens of clients in the very first week or month. Sometimes those dreams are fulfilled, but most of the time they are not. If advertising was a sure thing, there would be less of it. It would be more expensive. Every business would be successful. There would be no small businesses.

There are many ways your advertising message can be delivered. All advertising mediums can be effective when used properly and consistently. However, no advertising is worth the investment if you just shotgun it or try it a short time.

Here's why: Even among consumers that want your services, 98% will not bother to call you the first time they are exposed to your ad. Maybe they are short on time or just looking around. Often, consumers will simply procrastinate and not make the call. They will make a mental note of your advertisement and come back an hour, a day, a week or even months later. If your ad has disappeared, you've lost a potential customer.

While your advertising could get you a phone call or two right away, your biggest success will come from those who don't yet have a need, but will in the near future. Most products and services are not purchased on a whim. They are considered and talked about for some time.

When the consumer receives your advertising message, they may not be ready to respond, but they listen and pay attention. In their mind, it is part of the decision making process. The final decision will be made in the fututre. This is particularly true in advertising big ticket items where there is a high emotional component in the decision. If consumers don't see or hear your name now, you stand less chance of getting the call when they take action.

Along with accumulating information on potential services providers, the consumer starts paying attention to where they find the advertising. When the time comes to take action, they are then going to respond to that which is top of mind. They are not at the starting their buying process, they are at the end of it.

Advertising consistency is the key to higher performance. A single advertising insertion or schedule may get you that lucky immediate response. However, if you measure your success on initial shot, then chances are that you will have lost about 98% of your advertising's potential. Advertising is a long-term investment and should only be entered into when you are ready to stick with it. Your advertising investment works like compound interest. The first dollar you invest continues to work month after month. There really is a substantial penalty for early withdrawal.

It is important to measure and monitor your results. If you are not satisfied with the results, ask first, “Are my expectations realistic?” Second, “Does my ad need to be changed?” Third, “Do I need to be more patient?” and finally, “Should I cancel my advertising?”

Consistency make advertising work and business grow.

Jim Gustafson is the author of Take Fun Seriously. He was ordained in the United Methodist Church. He served as a pastor, counselor and conference leader. In addition, he spent more that 20 years as a broadcasting executive and consultant. Currently, he resides in Florida where he works, writes, plays golf and pulls weeds.

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