For SBT
Any business can be its own advertising agency.
You don’t have to pass a written test or apply for any special license. So, why not you? You run a small business now. Why not add advertising to your list of responsibilities?
Lots of small business people do. With no "entry barrier" to becoming their own advertising agency, they see some of the advertising on television or in magazines and think, "Hey, I can write better mindless drivel than that."
On top of that, ad agencies mark up everything they produce as much as 20%, they charge 15% commission on media, and they don’t know nearly as much about your product or industry as you do. Who needs them?
You do.
An agency takes the burden of the production process off your hands and makes sure everything is done right. They charge for production because they earn it. You may know how to contact a good illustrator, how to spec type, judge a good press proof, or even negotiate a media buy. But it’s not likely you know how to do all of those things.
The pros at ad agencies are functionally specific. Your lawyer or your accountant will never know your industry as well as you. They know law and accounting. Likewise, your ad agency knows advertising, and how to apply it to your business.
There are three ways to delegate the advertising function: choose a full-service agency, an advertising "boutique," or a consulting service.
The full-service agency is ideal if you need full service. That includes strategic planning, market research, media planning and buying, copywriting, layout and design, production services, sales promotions, public relations, and Internet services.
The big full-service agencies generate some of the best creative ideas in the world. Their advice and counsel could be worth every penny you pay for it.
Unfortunately, big agencies like to work for big clients. Their best people work on accounts that generate lots of income. They may do great work on full-page ads in Sports Illustrated. But a quarter-page in Control Engineering is just not their cup of gin.
So your account gets sloughed off to the new kid. You may like the sound of saying your agency is J. Walter Thompson, but the benefit often ends there.
If you need a full-service agency, go for one that suits your size. Look for a small, personalized operation headed by one or two pros, experienced advertising professionals who work on each account themselves.
They will work closely with you and get to know your products and your industry and provide marketing recommendations. They can serve as a source of experience and advertising wisdom. In effect, you pay for their talent, not agency overhead.
Then again, if you don’t need all the services of a full-service agency, don’t pay for them. Use a "boutique" agency. It’s an "ala carte" approach that often works well for a small business.
A boutique agency is usually founded by one or two professionals with specific skills. They specialize in one or two functions. That way, you don’t pay the overhead for services you don’t use. You pay only for the services you need.
For example, you have a dynamite ad that ran in your local paper and generated lots of sales. Now you want to expand to other markets. You may only need a media buying service to plan and buy the most efficient newspapers in your chosen markets.
Or, your industry has only one trade magazine that is read by everyone. And you want to continue advertising in it exclusively. You may only need a creative boutique to design and execute a few innovative ads that will pull in customers.
The third option is the independent consultant. These are usually single-person operations. Their overhead is low, and you can count on their close attention.
The independent advertising or marketing consultant frequently works with a loose affiliation of similar one-man or one-woman operations to provide a complete range of services.
They may lack depth of knowledge in more than one or two functions. And they may try to do too much, rather than calling upon others with more expertise.
But if you find one with the right combination of skills, one who’s demeanor and temperament are compatible with yours, an independent consultant may be the most efficient use of your promotion dollar.
Robert Grede, author of Naked Marketing – The Bare Essentials (Prentice Hall), is president of The Grede Company and teaches marketing and promotion at Marquette University. www.thegredecompany.com
April 26, 2002 Small Business Times, Milwaukee
