SwBratcher's Posts

I was sitting at The Hub in Springfield, MO and an ad sales rep for a local web site stopped in to pitch the owners on some ad space. His pitch was enthusiastic and felt like a sales pitch. So, how would these two small business owners know whether or not they would benefit from advertising with this site. This got me thinking about how many small business owners may benefit from the napkin of questions that I wrote up for them, for the next time this type of visitor stopped in.

It might expose them to a new demographic, it might build their local brand, it might make them millionaires.... whoa, whoa, whoa. Let's not get in a hurr. There is no real way for them to know what this ad contract will do for them. For one, their business is new in the city. And two, they have no idea if this is cheap or expensive, valuable or worthless. I can't guide you specifically when it comes to reaching your market with your advertising. However, I can offer some ways that you can handle yourself better in the conversation from a technical perspective. This will help you determine if you will have the tools necessary to identify the effects of your reach into the market and your ROI (return on investment).

Here are some questions to ask the sales rep during and after the sales pitch. These will help you determine if you'll benefit and if you'll be able to identify how you have benefited from advertising if you choose to give the site's ads a chance.

1. Does your site have click tracking built in?

If so, it will give you an idea of how many times the ad has been clicked. You'll still want to compare this number to your Analytics numbers for billing and ROI calculation accuracy. This will also tell you if the site administrators are tracking the success of their advertisers or just collecting checks and calling it a day. If they don't have click tracking, you'll have to rely on your own Analytics tracking to determine the amount of traffic sent to your site and the site publisher probably isn't in the business of making sure everyone is winning.

2. Can you show me your traffic statistics?

Total visits per month (not hits)? Unique visitors per month? What is the site bounce rate? Don't listen to "X number of hits" statistics, this won't equate to visitors.

Another way to analyze the site stats is to identify what ratio of their traffic is direct versus search engine traffic. Search engine traffic is a sign of a well known site. This can mean growth potential, word of mouth and is likely sustainable if they stop advertising or slow down directly promoting visits during your contract. If they don't have search engine traffic, they aren't likely well known. Judge this at your own discretion, as this is merely an indicator, not firm evidence.

3. What is your demographic and psychographic user profile?

Demographic info sounds like: "18-24 year olds from the south side of town."
Psychographic info sounds like: "Young professionals that want to be part of the cool crowd and hit clubs on weekends, but have downtown office jobs during the week. They love coffee and target trendy shops over national chain shops."

You want some of each type of data. You may need to dig a little to get the psychographic info and you may not be talking to someone who even knows what that is, though it's becoming more of a buzzword as people start to realize that demography alone doesn't generate sales. Try combining the demographic data with the answers to some of these questions to create your own psychographic profile of the site visitors to see if they fit your ideal customer profile. If I'm one of your site visitors, how did you get me to come to your site? What info or content did I come to see?

4. What is the average CTR (Click Through Rate) for your advertisers?

If 1000 visitors hit their site and 100 are shown your ad and 1 clicks your ad the CTR is .01, or 1%, or 1 per 100. If they can provide you with an average or a few examples

5.Is it their opinion that your ad will be sending you traffic or just visually brand-building through impressions only?

Evaluate your sales person as they answer this one. This opens the door for BS and if you smell it, make sure you validate all of their other answers.

5. What promotions have they done to boost traffic? What case studies can they share with you where they've help other local businesses?

They may want to make you a case study if they don't have one they can show you. This can set you up for 3-6 months of free advertising. Your part of this arrangement is to be transparent with your gross monthly sales fluctuations by percentage. You'll want 3 months prior if available and the time during and if you stop advertising with them and sales fall off a bit during the 3 months after it would be very kind to provide them with that information, so they can show a before, during, and after snapshot. You'll also want to be able to share your traffic stats so you'll want Google Analytics connected to your site.

7. Is it okay if you talk with this other business about their experience, so you can learn from their successes and failures before moving forward?

If so, talk with them and get an idea of whether they got traffic from the ads and if they saw a good ROI on the ad campaign. How long did they use it, would it have been better if they had gone longer? Did the ads end up reaching their market? Was the price right on the ads? Can they give you an idea of what they feel the value of the ads is? Tread lightly with these last couple questions. Don't go here if you feel you are crossing a personal or ethical line. Keeping this conversation healthy is more important than extracting every detail. Feel free to look at the advertisers on the site currently and inquire with them similarly, but without the reference relationship linking you back to the publisher.

8. Are you willing to do a trial month for free or at a discount, or give us a PPC/CPC (pay per click/cost per click) instead of a CPM (cost per mil/cost per 1000 impressions)?

This would give you the chance to only be charged as the influx of traffic hits your site, instead of paying only when the browsing visitors see your ad's impression. As a small business, understand that odds are you don't have the money to 'brand' yourself by paying for advertising. It costs about a $1 per person per month to brand your business (or per year if slow paced). How many people are in your market in your community? Instead try to spend on advertising that is directly related to cashflow if it works.

9. How often can we change our ad during our campaign?

They should be open to frequent changes and even multiple designs/URLs to help you identify which creative works best for getting sales out of resulting traffic.

10. Can we pause our campaign if needed?

As a small business you never know what will delay or slow down your cashflow. You want to keep your set Survivable Dormancy Expenses as low as possible in case you need to hit pause for a month or two.

11. How can you help us calculate our ROI?

If they have tools to help you identify your direct income that has resulted from their ads, then rejoice, because it isn't likely. See if they've done any campaigns with companies that required tracking of codes or ad-to-sales funnels. It could save you a lot of headache later as you try to make sense of your data, if you can uncover a means to set up your campaign with this tracking from the start.

12. Does this tie in with any non-digital marketing to further benefit our business? Can it?

It is a great diversification if you can get the same money buy digital and non-digital ad space or market exposure. On a limited budget it isn't always feasible for you to experiment with a potentially ineffective advertising method. The risk of money in the bank being spent with no impact isn't one worth taking. Every dollar out needs to give your company's forward momentum a push. Slippage from failed experiments won't impact a well funded business like it can yours. Tie your digital campaign to a flier/coupon handout or a printed coupon/ad.

Keep in mind that your local business is being approached by another local business. They can almost certainly be just as flexible as you with pricing, bartering, feature adjustment. If you like their site, and if you think their market overlaps with your market enough to benefit you, and if you want to work with them, genuinely let them know this and openly discuss options of easing into a long term relationship.

I'll let you know if anything ends up happening with the deal I witnessed, based on my napkin. I've even reached out to the sales rep to share with them the same list that they should be prepared to discuss as a publisher of an ad supported site. So, to be continued.