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Advertising Doesn’t Create Growth

Advertising Doesn’t Create Growth

Large companies and small business owners alike have long used promotional tactics and advertising strategies to drive sales.

“25% Off!”

“Call today for your free kit.”

As buyers, we’ve seen these promotional messages for over 60 years. Turn on the television, open Facebook, or search Google and you’ll observe companies chasing buyers in the same way they have for decades — with discounts and advertisements.

Industry experts have said for the last 15+ years that advertising was dead. The “advertising is dying” drumbeat started in November 2002 when Gallup released a study that proved traditional advertising expenditures were not generating results.

At the time, experts claimed that traditional ads would be replaced by digital advertising as Google started its rule. A few years later industry experts said social media would replace ads, then it was YouTube, and now the latest craze is Instagram and TikTok.

Yet, companies are STILL spending money on advertisements and promotions that try to induce buyers into making a purchase. Guess what? It’s still not generating a return on investment!


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Mediocre advertisements should at least generate a 2X return on investment (twice the revenue that was spent). Anything above a 5X return is golden.

As a business owner, are you getting a 5X return on your advertising dollars? Probably not.

Advertising IS dying, and most entrepreneurs know it. Yet, we make the same mistake year after year – as soon as revenue dips, we react by running advertisements, hoping to magically encourage buyers to buy from us. It does not work, and this type of thinking is not the path to growth.

Most businesses make this mistake, but for entrepreneurs, this habit can be deadly. Not only does an advertisement mindset produce decreasingly less impact, but it also eats away at profits leaving less cash to operate and grow the business.

Cash is oxygen. Without it, you die. So, if you’re burning cash on advertising, you’re going to run out of breath, plain and simple.

The truth is, we can’t MAKE someone buy. The reason why advertising doesn’t work has nothing to do with the platform. (TV, Radio, Facebook, Google, Print) and everything to do with INTENT.

Advertising is designed to GET someone to buy. That’s the intent. And it doesn’t work. What you really want is demand – demand encourages buyers to build a relationship with you and allows you to provide value to them before they buy. This works because when the buyer is READY to make a purchase – they usually buy from you.

So, what can you do to shift away from traditional small business advertising?

1) Give up advertising just like you would a drug. Go cold turkey.

2) Commit to implementing demand generation strategies now, and don’t stop until they are generating a 5X return.

What is Demand Generation?

Demand generation is implementing a system (repeatable and scalable) that builds relationships with buyers BEFORE they purchase.

Buyers want information; they want to be educated. They want to experience value and build a relationship with brands BEFORE they purchase from them.
– Think of it like test driving a car.
– Or when you go to the grocery store and try a sample.
– Or when you evaluate online software and get to try it for 14 days before you purchase.

Isn’t That Expensive?

What does it cost to give away your product as a sample or to create a tool (quiz, webinar, case study, seminar) that will help your buyers in some way? Yes, it costs money to do that. But, it’s usually far LESS expensive than advertising.

There are 3 keys to building an inexpensive Demand Generation System:

1) Channels: Rather than advertising channels, you’ve got to think about where your buyer is tuned in. WHERE are they? What are they reading? What are they listening to? What are they attending?

2) Activities: What activities can you do to provide value? What do they need before they buy? Information? Education? Assessments? Samples? Case Studies? How-to Videos? Choose the activities that add the most value to your target market.

3) TLC: Show some good-ole TLC. Share your passion, values, and culture with them. A peak behind the curtain can go a long way for businesses.

Remember why you started this business to begin with? It was to serve, right? Get back to those roots. JUST add value.

IGNITE On Purpose was founded by successful entrepreneurs who are passionate about authentically growing businesses. Our purpose is to IGNITE business growth for founder-led businesses that are making a difference in the world.

We are so good at Demand Generation that we offer a Pay For Performance Program – and only make money when you’re making a profit.

Contact us to see if we’d make a good partner for you, and ultimately, help you experience profitable, accelerated, and continuous business growth.

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