pricing: the cheesy facts

This week’s advertiise blog has been written by Guest Writer Andrew Holmes, Account Executive at Pattison Outdoor.

 

“Look pal, just give me your best price on whatever you’ve got and send it over!”

I’ve heard that one more than enough times. I get it, no one wants to over pay for anything. Heck, most people don’t like paying for anything, period. The thought of spending money can almost paralyze some folks (this doesn’t apply to my wife for some reason…)

But here’s the thing… we’re all in business (and in life) to make, and also to spend money, so relax – it’s a part of how the world works.

Speaking of works – what do you normally order for pizza?

Your answer may sound something like this “Well – for the wife and I, we usually get a 12” works pizza and a 9” garlic fingers.”

What do you pay?

“$24.99+tax and delivery”

Perfect!

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Now – let’s try that question again, with a small adjustment. What do you normally order for pizza while you’re on a quick lunch break?

“Well, there’s a great little pizza joint next to my office. I can get two pieces and a pop for 6 bucks.”

Excellent. Let’s try again.

What do you normally order for pizza for your daughter’s birthday parties?

“A party pizza with a 15” garlic fingers.” What’s that cost? “$45.99 + tax and delivery”

Okay, so based my question we’ve now arrived at 3 different prices;

$6.00, $24.99 and $45.99

The overall goal of each scenario remained the same – to be fed and to enjoy some pizza. But, the scenario in which that pizza was to be consumed changed each time. The most prominent change is the number of bellies that need to be full.

If you have to feed an entire birthday party and you have a budget of $6.00 you can technically get pizza at an excellent price. When two slices of pizza and a can of Barq’s Root Beer show up at the door, I’m also sure you could find a way to split the serving equally. You stayed within your budget, everyone got about half an inch of pizza, but no one is full. Great price, terrible end result.

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This same principle can be applied to investing in something like advertising. How many mouths do you have to feed converts to how much of a return do you expect to see? How many units do you need to sell? How big is the scope of this project? How important is it that this product succeeds?

For example, let’s say Linda sells cars and she is looking to do an outdoor advertising campaign (billboards, buses, etc…) to help bring awareness to which dealership she is at and what products she can offer her customers. Let’s also say that the exact dealership that she works at is looking to do an outdoor advertising campaign of their own to help raise awareness to their newest vehicle release.

Both have almost identical goals, they want to sell the EXACT same cars.

The difference? How many cars they expect to sell (AKA how many bellies they need to fill)

Linda may have a goal to sell 5 cars in a month. To do this, she may need to speak with 20 prospective customers.

The dealership she works at, may have a target to sell 30 cars in a month. To do this, the dealership may need to have 120 prospective customers walk through their doors.

So, to speak in relative terms, Linda may need a billboard here and there to raise just enough awareness to help her get to her goal. The car dealership would likely need a more robust campaign to help bring in enough people to help them get to their much larger goal.

Linda only needs enough pizza to get her through lunch. The dealership is catering to a birthday party.

The prices of each campaign would be much different because the needs and expectations are different.

When looking at doing advertising, it is important to work with your media rep to have them help you develop a strategy that is relative to your unique goals and expectations. A properly trained media rep will help you to establish a budget and do what is right for YOU and YOUR BUSINESS. You can always have Linda’s price, if you want, but be careful because you may just get Linda’s results as well… which is obviously okay… if you are Linda.

Andrew Holmes

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Andrew Holmes Pattison Advertiise

Andrew Holmes is an Account Exectutive for Pattison Outdoor in Saint John, New Brunswick – Canada.

Be sure to contact Andrew Holmes for all your out-of-home advertising in New Brunswick here:

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