You Don't Need A YACHT To Catch Fish

You Don't Need A YACHT To Catch Fish

by Anthony Tesoriero Jr.

"You don't need a yacht to catch fish." You are probably reading this and wondering what the heck is he talking about? What do fish have to do with tanning? However, before you dismiss this article, I did not make a mistake. Actually, if you hear me out you will begin to understand that what I am talking about is advertising. In fact, I am precisely speaking about the powerful draw of advertising to attract boatloads of qualified prospects to your door very cheaply.

Let's start from the beginning. My friend had just spent a lot of money on a brand new luxury cruiser with every type of high-tech fish finding gadget known to man. My self-proclaimed expert friend and I fished for 12 hours straight and did not catch one fish. However, as we were leaving the dock, we noticed a small group of guys was pulling in buckets full of fish. I noticed they were using old soda cans with used fishing line wrapped around them as poles and corks from wine bottles as floats. They found old hooks laying around on the rocks and dug up worms and clams from the beach for bait--proving you do not have to spend a lot of money on a big boat to catch fish. Moreover, for our purposes you do not have to spend a lot of money on advertising to attract customers.

Part of the problem with small-business owners is we often evaluate our expenditures in business the same way we may evaluate our expenditures in real life. In other words, we often fail to see the value in intangible purchases.

For instance, when given the choice between spending money on a new pair of designer jeans or the same value of the jeans in stock options in Levi's, most people are going to opt for the jeans. Most of us will figure that the jeans will provide immediate gratification, we can see, touch and feel them. The stock options on the other hand do not give us any satisfaction. The options are not a sizable enough investment to make an immediate difference in our finances. We cannot see, touch or feel tham and, besides, what if they lose value? Then we will have lost money.

However, the stock options also could go up in value and, like advertising, if you keep investing even a small amount consistently, eventually the dividends will add up. The jeans, however, will lose 90 percent of their value the moment you wear them. As business owners, we often make the same mistake, evaluating the price of advertising vs. the price of a new decoration for the salon, a new stereo or just the feel of the cash in our hands.

What you should be asking is, "What if it does work?" How will you manage all of the new business you will gain and what are you going to do with all of the money it makes you? However, unless you make a commitment to advertising consistently, even on a small basis, you are doomed to receive only what you have received so far and maybe less.

The key to knowing how cheap advertising actually is comes in understanding the value of return on investment and then evaluating your advertising expenditures with this in mind. For example, if a direct mail advertisement with Val Pak costs $500 and you see that as, "$500 for a tiny piece of paper most people are going to throw away," you have to reevaluate your thinking.

In fact, the actual cost of that advertisement is less than a nickel. Even more amazing is your return on investment, even skeptically figuring only 1 percent response to the ad with a 50 percent retention ratio of the customers who actually responded would equate to more than doubling your money.

Now, before I babble on about ratios and expenditures it is not that hard to figure out. You see, if your ad reaches 5,000 households in your area and each of those households has 2.5 people living in it, statistically speaking you will have reached 12,500 people. (5,000 x 2.5= 12,500). Now let's figure 99 percent of those people throw out the ad. That would mean only 125 people cared enough to be interested in the ad that cost you $500 to send (12,500 x .01 = 125). It is beginning to sound grim.

Now let us say it gets worse and only half (62) of those people actually buy from you. That would be less than one half of 1 percent of the original 12,500 people. You may be saying, "I told you it's not worth it, give me the $500 cash back and keep your advertising." However, if those 62 people purchased a $40 package that cost you $10, you would have $1,856 in gross sales with a net profit of $1,356. (62 x 30 = $1,856 - $500 = $1,356). You would have more than double your money on that $500 investment.

More importantly, you would have 62 new customers in your doors and another 63 potential customers who saw your ad and may soon respond. (125 - 62 = 63) So, actually, the ad cost you less than a nickel per person for the whole 12,500 people, 10 cents per household, $4 per respondent or $8 per customer. It just depends on how you want to look at it. Either way, you made money on the deal and the dividends will continue to reward you as those new customers continue to buy and spread information about your salon via word-of-mouth. Thus, you do not have to spend a lot of money on advertising to attract customers.

In my popular Motivated to Market™ seminars, we give attendees dozens of useful ideas to advertise very inexpensively or for nothing at all. In this article, we are limited by space to explain all of them in depth, so we will stick to just a few. Each of these ideas has its place, meaning that not all of them will work for you in your specific situation. The goal of truly effective advertising is to match the mix with the medium and message to reach the exact target audience. This is easier said then done, so to this end we encourage you to experiment with everything and reinforce what works.

• Fliers--The most obvious and very inexpensive, but not effective for upscale clientele.
• Church Bulletins--The cost of advertising in church bulletins usually is nothing more than your weekly tithing, and it's tax deductible.
• School Newspapers--These reach a perfect demographic of heavy users of tanning and the ads are dirt cheap.
• Local Cable--The cost of production is 50 times higher than the cost of running the spot. Local cable ads can be less than $10 per piece. You can lease professionally produced commercials from companies without the high production cost.
• Promo Packs--An immensely powerful cooperative advertisement which is guaranteed to work and other people will pay for it (I'll talk about this further in a future article or you'll have to come to one of my seminars).
• Available Space--Use available space in your salon and sell it to other business, co-op it or just use it yourself to hit your target audience perfectly.
• Cash Register Tape--A phenomenal approach, which targets a predominately female audience.
• Classified ads--Take these out in local papers and tease customers into calling for more information.
• Community Calendars and School Calendars--Another fund-raiser type ad which is guaranteed to hit the household in your immediate surrounding area.
• Door Hangers--Domino's Pizza made this famous and you know it works.
• Newsletters--Why pay others to advertise when you can just start your own paper.
• Vehicle Billboards--You already live the business, if you start driving it around town it is guaranteed people will notice you. In addition, the gas is a tax deduction.
• Bulletin Boards--Most apartment complexes in the surrounding areas have community centers with bulletin boards for residents. Very cheap and very effective.

Advertising does not have to be expensive to be effective. However, advertising does have to be consistent to be noticed. Often, as business owners we feel emotionally attached to our business and rightfully so. We have time, effort and a lot of money on the line. Nevertheless, keep in mind it is a business and not personal. You have to manage your business much differently than you may your personal life, and in some cases that means you may need to take more chances. What it also means is that you cannot take the little set backs as personal attacks. It is all just business as the phrase goes.

Do not fear losing money on advertising. Even the most non-lucrative advertising pays dividends by reinforcing your name and brand image. Keep in mind that the small investment in Levi's stock options are worth a heck of a lot more in the long run when you are using the old jeans to clean up spills in your salon.

John Abaté™ International's Director of Salon Education, Anthony Tesoriero Jr., HbP, has actively been involved in both the tanning and beauty industries as a popular speaker and successful owner/operator of multiple salons. An experienced tanning expert specializing in motivational speaking, Tesoriero travels extensively conducting comprehensive educational seminars within a motivational format for both distributor and salon personnel, as well as at major skincare and tanning industry tradeshows. His highly celebrated Motivated to Market seminar has become an industry standard in salon training, securing Tesoriero as one of the most dynamic and sought-after speakers in the tanning industry.