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Guest Editorial

Invest in the future

How advertising contributes to the bottom line

By Keith Langham

June 2009 - "A man who stops advertising to save money is like a man who stops a clock to save time." - Henry Ford

Successful B2B marketers, like their consumer counterparts, know advertising generates brand awareness and leads that turn into sales. But even veterans are sometimes surprised by how much harder advertising works in tough times.

Plenty of research shows that companies that maintain or increase advertising in a down economy enjoy more sales growth than companies that cut it--43 percent more, in one major study. And those advertisers maintain their advantage through the three years after the recession.

It stands to reason. In a less crowded field, advertisers can stand out simply by being visible and be top-of-mind when purchasing decisions are made. As Muhtar Kent, president and CEO of The Coca-Cola Co., Atlanta, told Fortune magazine last month: "One thing we don't do in this crisis is cut marketing around the world. We continue to make sure that our brands stay healthy and that we exit this tunnel with more market share than when we went in. Crises offer the best opportunity to communicate with customers because airways are cleaner; there's much less congestion there."

Of course, advertising produces a solid return on investment in good times, as well as bad. Recent studies have documented returns of more than $3 for every $1 spent on magazine advertising in a year and $12.20 over a decade. Longer-term results can be harder to quantify, but they are just as real. Advertising introduces brands to future customers, building awareness among new prospects and nurturing it into preference. As landmark research by Harvard Business School and The Strategic Planning Institute made clear years ago, awareness and preference are crucial stages in increasing market share and profitability.

Advertising also provides invaluable sales support to B2B salespeople, who typically have only four minutes a day to speak to new prospects. In trade magazines and on computer screens, ads pave the way for sales calls, reach executives who don't see salespeople, change (or reinforce) market perceptions and drive traffic to an advertiser's Web site.

Despite what some would have you believe, print advertising is alive and well in today's increasingly digital age. Research shows that trade magazines continue to be a leading source of information for B2B decision-makers, many of whom have made a purchase after seeing a magazine ad or visited an advertiser's Web site (57 percent and 41 percent, respectively, according to Yankelovich Partners and Harris Interactive).

Here's the bottom line: Advertising is not overhead, like people and facilities. It's an investment in greater awareness, growth and market share. With measurable objectives, a sound strategy and good creative, you can demonstrate a return on that investment that will satisfy any CEO.

All these facts and more are presented, with sources, in a PowerPoint show titled, "20 Reasons Why Advertising Makes Sense--Especially Today," available at the Brewer Associates Web site, www.brewer-associates.com.

Keith Langham joined Brewer in 1987 after 13 years in corporate advertising and public relations. He earned a B.A. in journalism at Michigan State University. He serves on the marketing committee of the National Kidney Foundation of Michigan and previously on committees at the Engineering Society of Detroit and other industry groups.

Brewer Associates has been creating effective marketing communications for more than 50 years and is committed to helping B2B clients increase sales and market share.

      
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