IT'S GOT TO STOP. This longstanding tradition of plumbing contractors overspending in the Yellow Pages for rotten results has gone on too long. And — silly me — I have every reason to tell you to get lots of very large Yellow Pages ads since we design ads for contractors. But I can't do that, especially not when I know this:
The dismally bad news
Has the YP rep been in lately? Sorry, I should've asked "How many have come from any of several different books?" You noticed that too, huh. Well, it's not your imagination. Recent figures show that an average of five new books were being added in the United States — every month!
Now let me guess, did they try to talk you into a bigger ad, with more colors in more sections? I'm going out on a limb here, but did they possibly mention that if you "invested just a little bit more" you'll get the "free" Web listing and if you'll sign right here you'd get this incredible rate as long as you agree to do the same or more next year?
Two hints as to why this might be happening. Hint No. 1: Reps work on commission, sometimes 100% commission. Hint No. 2: Unless you increase your annual expense with them, they probably don't get a commission at all. Does this make them evil? No way, but it does put them under immense pressure to make sure that you'll have all your Yellow Pages needs filled, and then some. A few more things you ought to know:
- Plumbers rank third in Yellow Pages spending of all Yellow Pages categories. Now do you know why they camp out in your office during the socalled "deadline" week, which mysteriously changes until you write a check?
- Of the $ 558 million plumbers spend, your results continue to slip as cost per lead goes up. How do I know?
- Over the last few years, Yellow Pages references have slipped by nearly 25%. (Translation: That's 5 billion fewer lookups.) Most of this is due to online references and "fragmentation" (fancy marketing word of the day) meaning your results are diluted as more media and more books creep into your market.
Just to ad insult to injury, pizza ranked 37th in spending with a measly $84 million, but pulled a Top 5 in number of customer references! Aargh! You spent almost half a billion more to end up more than 100 million references behind.
And if you're thinking, "Well, of course they rank higher because their transaction amounts are a lot less than mine," you'd be right. But realize that the other categories that got more references than you include attorneys, hospitals, physicians, new car dealers and dentists. All those have customer transaction values in the tens — if not hundreds — of thousands of dollars.
Bottom line: The once dominant shopping spot of a singular edition of the print Yellow Pages will not return. Yellow Pages advertising will remain a portion of a wise contractor's marketing budget, yet many contractors continue to pour money down a Yellow drain as if nothing had changed.
Well, some things haven't.
'Old way' is not working
Plumbers still spend piles of money in this declining media, with the same rehashed ads (that the YP "helps" them design) and wonder why the leads are drying up. Quit wondering.
An example: Your ads are supposed to stand out to get noticed, right? I mean, "Attention" is the first rule of all lead generation, right? Then tell me how your ad is supposed to stand out when you're using one designed or "approved" by the same people who sold and designed an ad for every one of your competitors who are all hunkered up in the same section.
You think they want your ad to be different and effective? They can't. If your ad clobbered the others, there'd be a huge exodus of commissions and that's NOT going to happen. Your ad will not — repeat, will not — gain any special lead-generating techniques.
We critique about 1,200 Yellow Pages ads a year for contractors. (We'll critique yours too, but I hope you're not sensitive!) Nearly 90% of them fail in one or more of the five Response Triggers we've identified. A shocking 31% fail in all five critical response areas. Is yours one of them? Find out. Your ad should be a guided missile instead of that oversized, overpriced popgun that doesn't work.
The budget solution
A question we often get: How big does my ad need to be? My very caring, sincere answer: Who cares? That's because though size does matter (make your own joke here), it is not the determinant of response, nor of your responsibility to your company. Am I preaching again? Yes, and here's why.
Your budget rules. Not me, and not the ad rep — regardless of length of visit or shortness of skirt. Not the "bragging rights" of having the largest ad in the plumbing section or your desire to be in the coveted "front of the section." This "preferred placement" is a joke anyway since nearly 30% of shoppers reach you by flipping from the back of the section.
Your budget is not determined by what you'd "like" to spend but by the rate of lead generation and sales. Three things help determine this rate and thus the budget:
- Specificity and responsiveness of market. What are the "lookups" or "references" to the section(s) you're considering? (The YP rep will tell you, but no one ever asks!) What products and services in your company bring you the most calls in a year or represent the greatest untapped lead source? Compare these before you jump in a section. It's too costly to get " experimental" in the Yellow Pages. If you want to find new revenue streams, do it in something controllable first, like direct mail.
- Specificity and "Attraction Factor" of your ad's message. Your ad must be laid out and crafted to halt the largest numbers of shoppers the quickest. What's the No. 1 problem they want you to solve? You want to "match" the message and the market. Screaming your company name at the top of the ad is not how to do it. That's the YP rep selling you your ego, which can be quite expensive.
- The rational percentage of sales dollars you're willing to commit to lead generation in the Yellow Pages. We advise between 21% and 31% of your total advertising budget in the Yellow Pages and less if you can get away with it. (This is based on 3.5% to 10% of your total sales spent in advertising.) We've advised clients to drop YP spending each year since 2001. (Some of you actually listened!) Back then, most of you were spending more than half your entire budgets in there.
Fun marketing metric: As you drop your Yellow Pages budget and insert a more powerful ad that produces the same or more leads (done quite regularly), you invest in other direct-response and retention marketing, which far out produces Yellow Pages and voila! — you've just gotten an " instant" decrease in your marketing percentage to sales.
Yet changing your ad and budget means, well, change. The "fear" of change is part of the problem, and YP reps fuel this fear. They tell you if you drop out, you'll spiral into bankruptcy, your competitors will bid on your remains and that — in technical terms — they'll call you a weenie.
Next month I'll tell you a few things that ought to make them fearful of you.