A wise person once said “Half of my marketing dollars are wasted; I just do not know which half.” This is actually an optimistic statement because depending on how you measure success the waste could be much higher. In the direct response business a response rate of 2% is not uncommon and that translates to 98% waste. The challenge with finding the waste is that success and failure are not always clearly visible.
Think about the last time you had a first transaction with a company based on a single impression from that business. Depending on who you listen to each of us is exposed to thousands of advertisements each day so it is incredibly rare that we respond simply on one impression. While a direct response can happen in the vast majority of businesses it takes many impressions before a prospect makes a measureable transaction. Consider the following:
The first time a man looks at an advertisement, he does not see it.
The second time he does not notice it.
The third time he is conscious of its existence.
The fourth time he faintly remembers having seen it before.
The fifth time he reads it.
The sixth time he turns his nose up at it.
The seventh time he reads it through and says “Oh brother”
The eighth time he says “here’s that confounded thing again”
The ninth time he wonders if it will amount to anything.
The tenth time he will ask his neighbor if he has tried it.
The eleventh time he wonders how the advertiser makes it pay.
The twelfth time he thinks it must be a good thing.
The thirteenth time he thinks it might be worth something.
The fourteenth time he remembers that he has wanted such a thing for a long time.
The fifteenth time he is tantalized because he cannot afford to buy it.
The sixteenth time he thinks he will buy it… someday.
The seventeenth time he makes a memorandum of it.
The eighteenth time he swears at his poverty.
The nineteenth time he counts his money carefully.
The twentieth time he sees it, he buys the article or instructs his wife to do so.
The over use of the word he and the last item are probably good clues that this list has been around for a very long time. According to the best information I have this was published in— Hints to Intending Advertisers; By Tomas Smith, London – 1885. While this list is 125 years old you can see that people really have not changed much. When you ask the question where did you hear about us the answer will always be the 19th or 20th step but in reality many areas are never credited with the transaction. Since we are AdWords Experts we would like to point out that the keywords associated with each of these steps are probably different. So if you never advertise for the early stage keywords how are you going to get the majority of the audience to this final step?
I propose that this list is not far off in many situations and it explains why we get the results we get. Were any of these 20 contacts wasted? My position would be that each step was part of the process and it simply took 20 actions to complete a visible reaction. At any point in the purchase process you could have hundreds or even thousands of prospects at the various points and this process is not purely linear. An individual prospect could skip or repeat steps because these are people not machines. I would propose that you can reduce this list by doing a better job of communicating your value and telling your story clearly and with emotion, but your prospect is still going to evolve over time not just instantly transform.
Think of your personal experience today. Studies vary but most indicate that you will be exposed to thousands of advertisements before you close your eyes tonight. Out of those thousands you might respond to one or two. If you are like most people 90%+ of your purchases today will not be based on advertising but on some prior experience or relationship. You will buy your coffee at the same place, get gas for your car at the same station, and buy a sandwich at a place you have been before. We are creatures of habit so the fact that advertising fails at a very high percentage should not surprise us. The challenge is that as a business you must reach out to new people consistently because if you fail to develop new business you will ultimately fail.
At my core I am a systems person that loves impossible challenges and that is why I work in marketing and my goal is to fail less often.