RV PRO

December '17

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rv-pro.com December 2017 • RV PRO • 61 of five star reviews, so the one or two bad ones don't hurt so much. Note: You must ask for reviews. If you don't you'll only get the bad ones! That leads me to CSI/ surveys. Today, those are mostly for internal discussion – reviews rule the day. The manufacturers don't advertise their high JD Power score in our industry. Not sure they'd want to see them. … Again, it's about the reviews. It's where everyone looks these days to determine the quality of a company or a product. You can't manage what you don't measure. You may be asking yourself if your budget for advertising is enough – or if it is too much. I would note that 20 Groups regularly discuss those metrics. For now, let me just mention a couple that relate to advertising. 1. 2 percent of desired sales. This is actually a metric that Quinn might have mentioned. It comes from busi- ness schools suggesting how much a startup business might want to spend on advertising. 2. 8 percent is now 5 to 6 percent of gross profit. It used to be the case that those of us running 20 Groups observed that profitable dealerships spent about 8 percent of gross profit. That is now too much. Face it: With the Internet and social media, advertising is cheaper. Look for the total advertising budget to be around 6 percent of gross profit. So, if you are between those two met- rics, you are likely in the ball park. Advertising Axioms If your value statement is about price, then price is all you have. That's good to remember when doing battle over a deal with a competitor who only sells by low- ball pricing (usually over the Internet). It's always better to do battle over quality, convenience, features and benefits. Quality and character are trump cards to play in the advertising card game. If you have a reputation that your "Yes" means "Yes" and your "No" means "No", it gets easier to compete. Character earns trust. Trust earns loyalty. Loyalty, as many studies have shown, translates to higher profits and lower advertising expenses. Advertising has, at some level, always been about gaining an edge. Advertising is about presenting a value statement that surpasses the competition in your market. That point has never changed. I can't help wondering what new concepts, advertising venues and tech- nologies will look like in another 10 or 15 years.

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