August 2004 | Vol. III - No. 8
The ability to promote your business is a key factor in success. Paperless advertising may trigger skepticism in traditional storeowners, but overcoming this leeriness could save money.
Tory Anderson, owner of WindWeavers Kites, an Internet store in Utah, doesn´t buy mailing lists or create any form of paper advertising. He uses Google AdWords and Overture. He explains, "Your ads only reach those who are searching for your category of products. You pay only when someone actually clicks on your ad, not for just when your ad is displayed." The downside is competitors using the same methods. "Because the placement of your ad depends upon how high you bid, more competition means higher per-click charges. I have seen per-click charges on ´kites´ go over one dollar per click. If you sold an item every time your ad was clicked that would be fine. But shoppers are smart and shop around and the ratio of sales per click isn´t always very good."
Anderson recommends watching the total cost of advertising compared to the amount of revenue coming in, and adds, "The ideal way to advertise on the Internet is to place high in the non-sponsored section of the search engine results. All the traffic that comes to your site from these listings is free."
Les Jarrett, owner of A-Trains and FamilyBedding, two successful Internet stores, believes that website advertising has a special advantage over catalogs. He can change product displays at will, and at A-Trains, customers can preview DVDs and tapes. In a store people would be limited to reading the packaging. "If you are a catalog-only operation, and you never send them a catalog, they may be the ´customer made in heaven,´ but never even know that you exist."
For A-Trains, Jarrett runs full page, four-color ads in magazines and sends out a printed flyer during the holiday season. Every month he emails an in-house list. He also pays for an ad in a weekly email that Trains Magazine sends to subscribers. Print advertising soaks up most of his money, but he does more advertising on the Internet. FamilyBedding is advertised on the Web only, allowing customers to mix and match fabrics on the screen, but print options may be tested. He´s found that the biggest disadvantage of the Internet is customer impatience and escalating demands for immediate delivery.
Jarrett remarks, "The magazine ads are fabulous for reaching those who don´t have Internet access yet. The print mailing is great for reminding customers we are around, and maybe will convince them to order something that they have been wanting and not yet gotten around to ordering."
Tom and Bridgitte Martin, owners of Video Game Exchange in California, use primarily paper advertising as 95 percent of their promotion budget. Newspaper ads, newsletters, and a free local magazine ad bring in their customers.
Bridgitte Martin says, "The expense of business cards and brochures is worth it and is the majority of advertising we do. There is too much competition on the Internet now, and more money is made locally. Internet is best for use as supplemental income."
She points out that the Internet reaches many more customers and will enable stores to sell rare items that won´t sell in a small town. The Martins design their own website and answer all email individually with no electronic newsletters.
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