The Catalyst

Jun
1
2010

internet, media, retail By Dave Eckstein | No comments yet

Which Media are Working for Auto Dealers Today?

ESA & Company | Real Auto Answers Webinar

SOUNDBYTES FROM THE AUTOMOTIVE INDUSTRY
REAL AUTO ANSWERS WEBINAR | ESA & COMPANY
The following article is one of a series highlighting the insights from ESA’s Real Auto Answers webinar. The webinar’s panel included Steve Finlay of Ward’s Dealer Business, Adam Armbruster of ESA, and four principals from successful auto dealerships.

Just as the pace of change in the automotive industry has accelerated in the past 18 months, the same is true in local media. So how does an auto dealer, in a rapidly evolving industry, make sense of the options and efficiencies available in a rapidly evolving media market?

As always, dealers want to draw physical ups to the lot, but today are also keeping a close eye on their website traffic. And whether we are talking physical traffic or internet leads (such as website visits and email inquiry), local broadcast television stands head-and-shoulders above the field in answering the call, and does so with high efficiencies. This point met with resounding consensus from the panel.

In 2010 and beyond, we expect to see continued disenchantment with (and a decline in) the effectiveness of paid leads, another point with which the auto marketers on the webinar panel agreed. As is mentioned in this forum and in many other places, the use of paid search and paid leads to drive local retail business is ineffective (and growing more so) when compared to a medium like broadcast television.

BROADCAST TV STILL MOST EFFECTIVE FOR AUTO DEALERS
Listen to Webinar Panel discuss today’s media options
ESA’s Real Auto Answers | May 14, 2010 | MP3 File (1.7mb)

Another temptation of auto dealers is to try cable television, which time and again has demonstrated glaring inefficiencies and scale issues for destination retailers of all sorts, let alone auto dealers. As Scott Fink of Hyundai of New Port Richey and Wendi Egbert of Southtowne Automall explain, it is a combination of broadcast’s reach and extreme efficiencies which trump cable for the auto dealer. The much higher CPMs of local cable television advertising (relative to broadcast TV) fly in the face of the efficient “good habits” dealers have acquired during the recent economic contraction.

BROADCAST TV TRUMPS CABLE FOR AUTO DEALERS
Listen to Scott Fink and Wendi Egbert
ESA’s Real Auto Answers | May 14, 2010 | MP3 File (0.8mb)

Smart media decisions like the ones detailed above will go a long way in providing a clear path to growth and profitability for auto dealers in 2010. The use of local broadcast TV is the perfect choice for dealers, as it aligns with their efforts to retain the efficiencies they’ve worked so hard to implement. In our next article, we’ll ask the mega-dealers in the panel what additional considerations they’ve included in their plans.

Dave Eckstein is a partner in the firm ESA & Company, based in Red Bank, New Jersey. Dave specializes in highly profitable market share growth for local business and gets a kick out of demonstrating a declining cost of customer acquisition for his clients.

May
26
2010

media, retail By Dave Eckstein | No comments yet

Auto Dealers Surging Ahead in 2010

Don’t let the title of this article fool you. Yes, there will be a higher volume of auto sales in 2010 than last year, but even the rosiest projections fall 3-4 million units short of the level from years past. Whatever the final tally is for ‘10, many dealers across the country are finding ways to make this a year of opportunity.

Yes, auto dealers have reasons for optimism. These reasons are pinned to the decisions they make over the next few months, namely their capacity to be aggressive while still adhering to the good habits that helped them survive the worst economic period of a generation.

Mike Johnson of Hickory Toyota is one such dealer. Johnson’s success is no overnight phenomenon; his dealership has been doing it right for years, as evidenced by the fact he has created a destination in Hickory, North Carolina (60 miles outside of Charlotte). His advice to his fellow dealers is simple in concept, but challenging in execution: Don’t forsake the good habits that have made us leaner operations. Johnson is keeping a close eye on everything these days, realizing his efforts will not only lead to stronger sales, but higher profit margins along the road to recovery. Mike’s decision to use local broadcast television is at the heart of the extreme efficiencies to which he refers.

DEALERS: KEEP GOOD HABITS IN GOOD TIMES TOO
Listen to Mike Johnson, Hickory Toyota
ESA’s Real Auto Answers | May 14, 2010 | MP3 File (3.6mb)

Scott Fink of Hyundai of New Port Richey echoes Johnson’s insights, and adds that dealers need to seize the window of opportunity upon them in 2010. It is one thing to resume growth, recovering at the same pace as the auto industry. Smart dealers that accumulate share in an expanding market will benefit tremendously and separate themselves from the pack. This is possible now because many retail points in the auto market are still hunkered down and “waiting to ride the wave”, rather than create their own forward momentum. Fink’s aggressive posture has already paid dividends at the dealership.

NOW IS THE TIME FOR AUTO DEALERS TO BE AGGRESSIVE
Listen to Scott Fink, Hyundai of New Port Richey
ESA’s Real Auto Answers | May 14, 2010 | MP3 File (2.0mb)

Many auto dealerships across the US are expecting — and already seeing — a gradual return to better times in 2010. Opinions and projections vary widely as to how strong and at what pace the recovery will happen. Those like Mike Johnson and Scott Fink have already made a few moves — and have a few more planned — that will clearly place them in the driver’s seat for 2010 and beyond. We’ll discuss more of these “good habits” for auto dealers in the next article, and take a closer look at how media decisions play a big role in their continued success.

May
24
2010

media, retail By Dave Eckstein | No comments yet

Optimism in the Auto Industry

Over the past 18+ months, we’ve seen the auto industry move from a mode of panic and survival, to talking about recovery and profitability. Though the industry is not out of the woods yet — with unemployment still hovering at high levels and an extremely volatile housing market — there is reason for optimism.

As Steve Finlay of Ward’s Dealer Business shared in ESA’s Real Auto Answers webinar, domestic auto dealers all posted positive numbers for April. Also, the industry’s continued focus on streamlining has made the prospect of profitability very realistic, and much closer at hand than originally forecast.

REASONS FOR OPTIMISM IN THE AUTO INDUSTRY
Listen to Steve Finlay, Ward’s Dealer Business
ESA’s Real Auto Answers | May 14, 2010 | MP3 File (2.5mb)

Regardless of where the current projections are set — Finlay pegs those projections for 2010 in the 11.5-12.5 million unit range, a far cry from the 16-17 million units sold a few years ago — the industry’s profitability will be bolstered by leaner operations and special attention by automakers to align capacity with market demand.

A NEW APPROACH IN THE AUTO INDUSTRY
Listen to Steve Finlay, Ward’s Dealer Business
ESA’s Real Auto Answers | May 14, 2010 | MP3 File (1.8mb)

However, the industry can’t hit full stride toward recovery until several lingering questions are answered, especially at the dealership level. Auto dealers who recognize the need to connect with car shoppers better today than they have in the past will profit the most. As Adam Armbruster explains, the auto dealer who uncovers these areas of opportunity and extreme efficiencies in their advertising will run fastest toward higher growth and profitability.

AUTOMOTIVE BY THE NUMBERS
Listen to Adam Armbruster, ESA & Company
ESA’s Real Auto Answers | May 14, 2010 | MP3 File (1.7mb)

As the industry continues toward a gradual recovery and higher efficiencies, local dealers have a window of opportunity today to separate from the pack by doing a few things right. In our next article, we’ll discuss a few of these items, and hear from a couple of auto dealers who are already reaping the benefits.

May
5
2010

media By Dave Eckstein | No comments yet

Media’s Best-Kept Secret: Local Broadcast TV

THE REAL FUTURE OF TV

Scott Chorski, GM of WKBT-TV, sent me a link yesterday to an Adweek article, along with a quick note stating how so many today are attacking the “30-second spot”, while very few write about what actually works. Scott is dead right. If I had a nickel…

I read the article he shared and came away feeling upset. I was upset because of a specific unsourced and misleading statement in the article.

If you want to find comment and opinion about the relevance and effectiveness of television (or any medium) today, you really don’t have to look too far. There are plenty of opinions on that subject. I would strongly advise you think twice before accepting these opinions as your own, or as fact.

The Adweek article in question states ” … the 30 second spot continues to lose relevance and effectiveness.” I didn’t find the source or data supporting this statement. Funny, we have plenty of sources and data demonstrating just the opposite. Real world stuff here, like unmistakably strong business performance. Lots of it, scattered across dozens of markets, within dozens of categories, in every economic condition. Statiscally significant stuff.

We could argue this point ad-nauseum, each side presenting its own stack of data. I’d rather not do that, because it’s counterproductive. And because we’d find out we actually agree on the real point.

This has nothing to do with the relevance or effectiveness of the medium. It has everything to do with the people using it and the decisions they are making. That’s exactly where Adweek and ESA agree.

Those who know the “why” and “how” of using broadcast television as an advertising medium are in the overwhelming minority today. They’re not too forthcoming in sharing their secret either, and I can’t blame them for that. Those in the majority — either using TV the wrong way, or not using it at all — like to claim the medium is losing effectiveness. Which is probably why you can find so many more “articles” on that side of the fence.

Fine by us. Though opinions like these make our jobs a little harder — after all, it takes effort to disprove ill-founded assumptions — in a strange way this misinformation fortifies our clients’ competitive advantage over those in the majority.

While “the majority” races to figure out how to insert ads into in-flight iPad video streams or (insert latest can’t-miss medium experiment here), we’ll be placing our bets on broadcast television. Again.

Funny how a medium that has more than its fair share of critics has so much upside for local businesses, even today.

And suddenly, I’m not so upset anymore.

Apr
19
2010

media, sales By Roland Eckstein | 2 comments

Lessons for a Thawing Market

What do the following dates have in common?

March 29, 1848
March 6, 2009
Yesterday

In a word: Choice

That which occurred on each of these dates is still considered by many (or at least by me anyway) to be simply remarkable. Maybe more remarkable than what had occurred on these dates was the action taken — or lack thereof — by those that witnessed the events.

Consider:

March 29, 1848
A day on which the people of Niagara Falls, NY and Niagara Falls, Ontario awoke to silence. The mighty and ever-present roar of Niagara Falls had run dry. For the first time in recorded history the Falls had stopped flowing. While not completely frozen, an ice-jam up river caused the Falls to go silent for several hours. Given the uncanny silence, reaction from local residents varied greatly :

Some assumed that the world had ended and prepared for the worst.
Many others simply “listened to the silence” and found it to be overwhelming.
The curious rushed to view the now dry Falls.
Then, there were those who became the first ever to descend into the Great Niagara Gorge. It was in the Gorge that these residents, possessing a higher risk-tolerance, laid claim to treasures that had been swept downstream and locked hidden underwater many years earlier. Bayonets, swords, tomahawks and pistols dating to the War of 1812 (and prior) along with other treasures were retrieved by those choosing to take advantage of this seemingly once in a forever occurrence.

March 6, 2009
A day marked by Wall Street as the lowest point for the Dow Jones Industrial Average (6,547) since 1997. The fear caused by the market’s continued downward spiral seemed simply unbearable to many who had never experienced such a cliff-dive. Analogous to the varied reactions of the residents living near the Falls in 1848, market investors reacted in extreme manners:

Some sold everything.
Others did the same but went so far as to actually hold the physical cash in their house.
Some, now “stuck in the mud,” sat tight.
Other investors sensed the obvious fear in the market and, well … ran into the gorge. Why? Look no further than the fear-driven share prices and correspondingly silly (at least to me) market caps of a few media industry leaders on that day:

Company	3/6/09 Share Price	3/6/09 Market Cap*
BELO	$0.56	$51.1M
GANNETT	$2.30	$547.6M
LIN	$0.85	$30.0M

Those who sensed and chose to act on this seemingly once in a lifetime occurrence were rewarded handsomely as the market began its slow but choppy climb back.

Yesterday
A day, which on the surface, seems like any other day in Broadcast Television. Countless should-be television advertisers … attorneys, HVACs, plumbers, auto dealers and retailers of all types that could be lowering their cost per new customer acquisition, continue to spend seemingly countless dollars in cable, radio, print, DM, YP and paid search. Yes, remarkable … at least to me anyway.

Unlike the prior “OTO” occurrences, this last one plays out repeatedly much like the movie, Ground Hog’s Day.

Yet, analogous to both the above mentioned “folks by the Falls” and those able to leverage market fear, television sales execs continually choose actions that vary greatly:

Some look away and simply plan anxiously for pending built-in demand builders, i.e. Olympics and elections.
Others assemble/peddle incorrectly labeled “turnkey” campaigns that do nothing more than move the station’s inventory at all cost to the unfortunate advertisers.
And then there are those that have done the math. It is this group that will seize the opportunities created given the crumbling of yellow pages, the now web-rendered inefficiency of direct mail, the “no-such-metric-(but we’ll-use-it until-someone-catches-us)-cost-per-spot” cable guise and last but never least, the “I can drive my business (into the ground) for as little as $3.00 cost per click” paid search.

Yesterday … someone held the antique pistol that their great-great-grandfather pulled out of the Gorge 162 years prior. This prize, now priceless, was undoubtedly worth the risk taken on that day.

Yesterday … LIN Television (TVL, now rebranded as LIN MEDIA) closed at $7.61. Shares have climbed 895% since March 6, 2009. A respectable return on risk/investment to say the least.

Yesterday … 1,000 attorneys waited anxiously for their phones to ring as their yellow page / cable advertising campaigns ran ad nauseum against the same 183 viewers at a CPM that would justify sponsorship of the next three Super Bowls.

Did you call?

You should … they have plenty of time to talk.

At what point will we look back and realize that “Yesterday” has been March 29, 1848 and March 6, 2009 for quite some time now?

Roland Eckstein is the Managing Partner of ESA & Company, an advertising strategy firm that accelerates profit for local businesses.

* Market cap figures are approximations from March 6, 2009.

Mar
31
2010

internet, media, sales By Dave Eckstein | No comments yet

Paid Search Advertisers: Switch to Broadcast TV

The “$3 CPC” is a waste of money for most local advertisers

If you asked local advertisers to choose between a $3 cost-per-click on Google’s Adwords or a $100 spot on local broadcast television, how many of them would make the best decision for their business?

More importantly, how many of us are prepared to show them which decision is best?

When we do the math and calculate the real cost of advertising, paid search generates many fewer leads at a much higher cost-per-customer than local broadcast TV. Of course, plenty of experts and skeptics still argue against this point, claiming paid search programs can’t possibly be inefficient, given their nature. Well, they’re wrong.

And now we have proof.

Make no mistake, there is still plenty of money pouring into paid-search, at national, regional and local levels. And that money will continue to pour in. In some cases, this decision will make sense for the advertiser. But for most local advertisers, it won’t be money well-spent.

We’ve been adamant about this topic because paid search is one of the fastest growing media out there. A lot of mistakes and poor assumptions are being made. Millions of dollars — diverted from other media — are being wasted, and a lot of qualified leads are going elsewhere. And, unfortunately, a lot of local media sales entities are missing out on a huge opportunity to help local advertisers — and themselves.

Any local broadcast salesperson who has a hard time believing this, try this profitable little exercise:

Do a Google search on one of the major service or retail categories within your market.
Make note of all the local businesses using paid search (right-side of the Google search).
Find out their cost-per-click (CPC). You can ask them or find it right on Google.
Use the ESA CPC vs CPM tool to demonstrate the difference in advertising effectiveness to the advertiser — right down to customer acquisition cost.
Repeat!

There is an assumption that no “apples-to-apples comparison” exists between traditional (broadcast TV) and new (paid search) media, especially since their pricing models appear to be quite different.

That assumption is now history.

CPM vs CPC: How Local Broadcast TV Beats Google's Adwords

ESA's CPM vs CPC "Paid Search Killer"

In five minutes time, any paid search advertiser can see, with your help, whether or not paid search makes sense. In short, many local advertisers cannot afford the $3 CPC. Seems counterintuitive, but the numbers don’t lie. Just like the fool’s gold of the $5 cost-per-spot on cable, the seemingly cheap cost-per-click of paid search can lead to a slow death for a local business.

Just in case you were wondering how many local businesses are spending $3 per click in your market: dozens of them. Okay, I’m sandbagging. The number could be in the hundreds.

This CPM vs CPC “paid search killer” is a tool developed by ESA, and available for member stations at no cost. If you’re interested in helping local businesses make an informed media decision, you can request your copy below. No strings attached.

Advertisers today have a choice to make: You can buy your media cheap, or your future customers cheap. It’s one or the other, not both.

Local media reps have a choice to make too: take five minutes to prove this to yourself, or forfeit a serious window of opportunity to somebody else.

GET YOUR COPY OF ESA’s CPM vs CPC SPREADSHEET
ESA & Company has an easy-to-use spreadsheet that will prove the efficiency of broadcast television versus paid search for local advertisers. Help your clients understand the big picture.

Price: FREE for ESA member stations. | Contact ESA for your copy.

Mar
26
2010

internet, media By Dave Eckstein | 2 comments

Abuzz About Buzz

Wow, that didn’t take long, did it? In a matter of weeks, Google Buzz looks to be a serious player in the social media arena. But, first, let’s back-up a couple of paces.

With billions of ad dollars pouring into paid search, we figured we should know a little something about it. Wouldn’t hurt to know how efficiently — or inefficiently — programs like Adwords could acquire new customers for local businesses, relative to broadcast television. And what we learned was that local broadcast TV wins that battle hands-down for most local advertisers, just as it (TV) does in head-to-head competitions with other local media.

So, clearly threatened by the progress we had made in exposing their soft underbelly, Google immediately launched a fierce counterattack with Buzz. (Okay, maybe we’re taking a little too much credit here!)

If you haven’t heard (and you should have, by now), Buzz is Google’s new social media platform. It boasts some of the same features that made Facebook and Twitter wildly popular. Lots of people will be using this — very soon. And ad dollars will invariably follow eyeballs, regardless of the specific volume or cost of those eyeballs. Oh, we might want to add here that Google is notorious for monetizing a good idea. This makes Buzz a legitimate threat to local media, (another) one that will likely go wholly unnoticed for at least one day too many.

No, we haven’t cracked the code for Buzz … yet. There are, however, some things you should know:

Yes, advertisers are already “buying” it. Literally and figuratively.
Yes, local advertisers will jump on the bandwagon too. Lots of them.
Yes, Buzz is already “game-changingly huge”. By that, we mean “bigger than Twitter” in a few short weeks.
Yes, it will probably enjoy the same spoils that Adwords did, because many businesses will haphazardly assume it is “cheap-and-easy” (and just like Adwords … it won’t be).
Advertisers who pay for impressions on Buzz — instead of leveraging its built-in social (read: “free”) networking — will blindly underwrite the cost of this service for users, and the cost of their competitors’ leads.

Buzz got so big so fast because Google brilliantly bolted it on to Gmail. In other words, if you have a Gmail account, you now have a Buzz account. In case you were wondering, there are some 38 million Gmail accounts out there.

Just as with search and social media, there will be positives and negatives with Buzz. In short, these will probably boil down to the following two postures:

It’s likely that local businesses can benefit from having a free Buzz account — so will their website traffic.
It’s likely that local businesses can and will overspend for leads by advertising on Buzz.

For now, your choice is to (a) get yourself a free Buzz account and learn more about your newest competitor or (b) drive with the headlights off. We chose “a”.

Those are ESA’s recommendations for now. We’ll have more, so stay tuned. More “buzz” to follow.

Mar
24
2010

internet, media, retail, sales By Roland Eckstein | No comments yet

Ever Wonder Why Some Advertising Doesn’t Work?

I was a huge 60 Minutes fan back before the content explosion. Every Sunday evening, the ticking stopwatch symbolized the melancholy end to my weekends.

Ever wonder?

I can still hear Andy Rooney, bringing my Sundays to a close with his patented phrase: “Did you ever wonder why?” Andy had his own spin on the phrase, whereby he would drag out the word “ever” and then pronounce “wonder” more like “wander” to effect the consistently perfect set up for his weekly topic on which he would … wander. (Okay, yes, the eyebrows always distracted me!)

Andy’s classic question is burned into my head and replays each time I sit with a business. At some point in the meeting, I hear Andy asking the question, “Did you ever wonder (wander) why you’re sitting with this client/prospect right now? They must need something from you or they simply would not take the time to be here.”

Consideration: Next time you’re sitting with a prospect or quite possibly a current client, ask yourself these questions:

Why I am sitting with this individual?
What does he/she really need?
What does he/she expect of me?

It truly simplifies down to one question that your client/prospect senses that you have, in the past, or will soon answer for them: “What can you do for me that I cannot do for myself?”

Answering this question starts with understanding all that you can bring to bear for them.

The mathematical comparison between Google’s Cost-Per-Click and Broadcast’s Cost-Per-Thousand
Eight ways to avoid wasting your ad budget
An advertiser’s cost per acquisition of their next customer is a function of their current medium’s cost-per-thousand
Why branding and image advertising do not work
Effectively applying media selection to the three key phases of a business … acquisition, retention and add-on sales
Which media are truly used to shop.
Discovering the “Critical Buying Window” of the consumer.
SEO vs. SEM
Using the 7 Disciplines of a Successful Advertising Plan for immediate results.
Proper Campaign Tracking Metrics
Three Ways That Google Adwords Fails the Local Business
Ten Dirty Secrets of Paid Search
Mathematical proof that cable’s “cost-per-spot hoodwink” is NOT and will NEVER be a media metric … and WILL increase the ASR (ad-to-sales ratio)
Awareness or Preference?… choosing wrong is fatal for any business

Next time you find yourself sitting across from a client or prospect, know that you demonstrated, maybe unknowingly, that you can do something for them which they cannot do for themselves.

Consideration: Go back over the series of correspondence that lead you to this and/or every meeting. Somewhere buried in your efforts, you answered the most basic of all questions that exists in business:

“What can you do for me that I cannot do for myself?”

Wouldn’t it be interesting to channel Andy Rooney at some point during each discussion and ask, “Did you ever wonder why we’re sitting here together?”

It must be our ongoing focus that broadcast television, when applied properly, will drive down the client’s cost of acquiring new customers while increasing sales.

The net result, given an efficiently run operation, will be increased profitability … and that is what you can do for clients that they often times cannot do for themselves.

Roland Eckstein is the Managing Partner of ESA & Company, an advertising strategy firm that accelerates profit for local businesses.

Mar
19
2010

media, sales By Dave Eckstein | No comments yet

How’s Your Bracket Looking?

A lesson in the “madness” — and the math — of March

Yes, this March my bracket is a disaster, just like yours.

Do you want an stone-cold guarantee for a winning bracket? If so, we’ve got it.

If you haven’t trashed them yet, take another look at your brackets. Put aside the wins and losses for a moment and look at the symmetry. A very important sales lesson is right under your nose.

Every team in the NCAA tournament wants to get to the Final four. Technically, every team wants to win it all, but the Final Four is the launching pad for many programs. And here’s where we segue into media sales.

Embrace the madness

We all can think of four advertisers we NEED to talk to very soon. Probably many more than that. But what we don’t realize, or fail to admit, is that it will probably take us 64 entries in our own brackets to get us to four qualified closing opportunities this week. Those who don’t see that haven’t been selling, or have been just plain lucky. Sorta like the person who picks their hoops brackets based on mascot size.

For every team that makes the Final Four, there are 15 other teams that don’t make it. Similarly, every “YES” you hear today is accompanied by about 15-20 “NOs.” This is nothing new to sales. Like basketball in March, sales is a battle of attrition.

The hoops champion is required to win six games. Similarly, it takes on average 6-10 touchpoints with an advertiser before we hear that final “YES.” Like basketball in March, sales is a game of persistence and preparedness.

Which is why the brackets that we fill out each Spring are a perfect analogy for how we need to refocus our developmental sales efforts. Continue reading How’s Your Bracket Looking? →

Mar
9
2010

media By Roland Eckstein | No comments yet

The Cable Guise: No Such Metric as Cost-Per-Spot

“But my cost-per-spot is too high!”

Have you ever heard this one? Better yet, how many times a day do you hear this one?

Don’t go there!

Why Not?
Because cost-per-spot is NOT a metric!

Why Not?
Because it cannot be!

Why Not?
Because for cost-per-spot (let’s give this non-metric an official title – CPS) to be a metric, the spots being compared or ‘metered’ must have the same number of viewers per spot.

Now, here’s the really important stuff about this bamboo shoot under my fingernail:

Cost-per-thousand (CPM) and not CPS will directly impact your client’s cost per sale and therefore impact their ad-to-sale ratio (ASR) and therefore… their profitability.

Said in another way: Cost per acquisition of a customer — one of the most, if not the most important measure of advertising — is a function of cost-per-thousand and not CPS!

Consider a client with $1,000 to spend.

His/her considered media selection includes broadcast and/or cable.

After careful analysis (and by the way, “careful analysis” rarely happens because if it did, cable would not be allowed to sell on CPS):

The broadcast television CPM is $10
The cable CPM is $40 (we’re sandbagging that number too … it’s usually more)

With broadcast, this client can buy 10 groups of thousands, or 10,000 possible customers.

With cable, this same client with this same $1,000 can buy 2.5 groups of thousands, or 2,500 possible customers … amazing how the cable CPM is 4x greater and the possible audience reached is one-quarter the size (in our house we call this, “Fun With Math”… in our industry it will be called,”StopTheBadMath.com”.)

It gets worse for cable….much!

Follow the below grid to see how critical it is to select the proper medium.

There is no such thing as cost per spot!

Rest assured that:

If you’re sitting with a client who analyzes your proposal based on CPS … cable was there before you
If you get a call from a client asking you to ’sharpen your pencil’ to get a better CPS … cable was there

If you want to help a recent or current cable-victim:

Prove the non-existence of cable’s CPS
Demonstrate the direct correlation between CPM and their cost-per-sale
See immediate improvement in their investment and return of ad dollars

Simply:

Ask for a recent cable invoice
Calculate the true cable CPM (remember to find the true delivery of the ads)
Develop a recommended broadcast schedule
Return the next day with the cable CPM and your CPM as analyzed given the above grid

The truth is, most local advertisers cannot afford cable television advertising. Yo, cable guise…we’re on to you!

GET YOUR COPY OF ESA’s CABLE KILLER SPREADSHEET
ESA & Company has an easy-to-use spreadsheet that proves the farce of cost-per-spot selling. Help your clients understand that they can’t afford cable television advertising!
Price: FREE for ESA member stations.

INTERESTED? Contact ESA today for your CPS vs CPM Cable Killer.

Roland Eckstein is the Managing Partner of ESA & Company, an advertising strategy firm that accelerates profit for local businesses.

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The Catalyst

Your best read for local broadcast television and internet sales, retail intelligence, and media insight

Which Media are Working for Auto Dealers Today?

Auto Dealers Surging Ahead in 2010

Optimism in the Auto Industry

Media’s Best-Kept Secret: Local Broadcast TV

THE REAL FUTURE OF TV

Lessons for a Thawing Market

Paid Search Advertisers: Switch to Broadcast TV

The “$3 CPC” is a waste of money for most local advertisers

Ever Wonder Why Some Advertising Doesn’t Work?

How’s Your Bracket Looking?

A lesson in the “madness” — and the math — of March

The Cable Guise: No Such Metric as Cost-Per-Spot

“But my cost-per-spot is too high!”

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