- WHITE PAPERS
"The Heartbeat of America, Chevrolet."
It's not only one of the most memorable ad slogans of the 1980s, it was an advertising industry award winner.
And yet it failed miserably.
According to marketing consultant Alger Cavalloro, not only were millions of dollars spent spreading the "Heartbeat" marketing message, the year the campaign launched, Chevy's sales dropped 17 percent.
"That's a perfect example of image advertising," said Cavalloro, whose company, Performance Marketing, is based in Algonac, Mich. "Image advertising is the type of advertising that focuses more on the aesthetics and the artistic quality of an ad. It doesn't get the reader to take action."
And yet so many businesses, pizzerias included, use image ads to try to draw customers — customers who may remember the catchy "Papa's Pizza" ads, but are never compelled to buy Papa's pizza. Simply put, said Cavalloro and several other advertising and marketing consultants, image advertising is typically a waste of money.
"If you're going to spend a dollar advertising, you at least want to get that dollar back. But it's unlikely that'll happen with an image ad," said Kamron Karington, author of "The Black Book: Pizza Marketing on Steroids," and a former owner/operator of two pizzerias. "An image ad says nothing more than how wonderful you are. But direct response is focusing on potential customers and telling them what you're going to do for them. If focuses on customers not your business."
So why do so many pizza companies do it? Two reasons, experts say. Advertising firms they hire tell them they need to do so, and because operators want to position their unique selling proposition (or USP which tells consumers what's unique about a business) before the public in a memorable way.
It's all good and well to claim to have the freshest ingredients and hand-made products,
The Black Book: Pizzeria Marketing on Steroids
The E Myth
"Here's image advertising in a nutshell," Karington began. "You're looking to get a wife from a service, and you're going to choose from two women based on their descriptions of themselves.
"One says, 'My name is Bambi, I'm tan, I have a great figure, I like to dance and I'm a brunette. Please choose me.'
"The other talks about how she'll do everything to make you happy, how she'll give you back rubs, take care of the children you'll have together, do the shopping and fulfill your desires. And then at the end she says, 'My name is Terri. Please choose me.'
"One ad is all fluff and the other says 'this what I'm going to do for you.' Guess which one gets the most attention?"
Great direct response ads typically "make customers an offer they can't refuse," said Brian Keith Voiles, a Salt Lake City-based marketing consultant and author of "Ad Magic." "You don't just throw out an ad that says, 'Joe Blow's Pizza. Come eat.' You give them a compelling reason to come, like a deal that feeds a family of four for $15, or whatever kind of deal you can afford to break even on. Just get them to come in to your business and try your product."
I just don't have time
Karington said that so many pizza operators get into the business believing their great pizza and service will be their best marketing tool, but that's rarely the case. When he first bought a struggling pizzeria several years ago, his first major purchase was a POS system — not for its ability to streamline his back of the house operations, but for its database building ability.
To augment that, Karington spent more than $5,000 on a supplementary database program that took information captured in his POS and generated letter and postcard mailers to customers.
"I asked the guy who installed my POS what percentage of the people who get these actually use it for the database," Karington recalled. "When he told me it was probably 5 percent, that shocked me."
Tom Bronson, president and CEO of Lewisville, Texas-based Rockland Technology Group, maker of DiamondTouch POS systems, said Karington's POS vendor is right. Too few operators use this valuable function.
"I suspect a relatively low volume of pizza owners use that information, which is at their finger tips," Bronson said. "Everybody buys a POS with (marketing) in mind, but they rarely go the next step to use it."
Bronson suspects operators don't use the marketing and database functions because they get bogged down in the day-to-day operation. That's not only a detrimental mistake, Karington said it almost guarantees a business will never grow to its potential.
"I divorced myself from the operations right off the bat, because I realized I wasn't going to make any money making pizzas all day," he said. Operators must do whatever it takes, he added, to carve time out of their day or week to focus exclusively on marketing. "I would leave the store in whatever incompetent hands I had to, and devote time to marketing."
Cavalloro said he counsels his clients to spend at least 20 percent of their working hours on marketing. If an operator can make great pizza and serve customers, then he can and should train others to do it. Marketing, however, must come from an operator's personal desire to grow his business.
The personal touch
Whether an operator's shop is set to open or struggling to get past $5,000 in weekly sales, Karington suggested he execute a simple letter writing campaign to jumpstart the business. He recommends buying from a mailing house an address list of all the homes and businesses in a three- to five-mile radius of a business.
Then the operator should pen a compelling, personal letter (template examples of such letters are available in his "Black Book") to all those customers explaining that business's USP, and offering them an incentive to try its product. Karington particularly likes a money-back, satisfaction guarantee, while Voiles and Cavalloro suggested giveaways and sweepstakes contests.
"Make sure your letter looks like it's from one human being to another human being, not from a corporation to a customer," said Karington. "On the address label or envelope, I'd even use a font that looks like handwriting, and I'd use a spit-stuck stamp — anything that makes it look hand done. And the owner's signature should be on every letter."
That personalized look, Karington said, increases the likelihood the letter will be opened, rather than trashed with the daily pile of junk mail.
When customers respond and try an operation's product, Voiles recommends operators move in for the kill by doing three things: deliver on the letter's offer (free pizza, free soda, salad, whatever is promised); get the customer's information for the database; and send them a personalized thank you note, within 48 hours, for coming.
"Sure, it's follow-up marketing, but it's really just staying in touch with your new customer," Voiles said. "It's like courting: you show them you love them, you show them you care." Over time, he added, that means sending birthday cards and anniversary cards, too, anything that further personalizes the communication with the customer. "You're treating them like a human, not like a number."
Cavalloro agreed, and said customers not only love to be invited back, "they're begging to be acknowledged by somebody, not by a four-color ad."
While Voiles said he liked loyalty rewards programs as ways to strengthen the customer relationship, he strongly advised operators not to require payment for membership in such programs. That gives them what he called "cause to resent."
"Anything that gives people cause to resent is a bad business model," he said. "It's like paying 25 bucks to get discounts at Barnes & Noble. Yeah, I may get 10 percent off a book, and it may pay for itself over course of a year. But I'm thinking, 'Why the heck can't I get this deal anyway? I come in here all the time, I should be getting this deal anyway for being a good customer.'"
Test first, repeat when necessary
Not every direct response marketing letter, postcard, coupon, etc., will be a home run. And since direct response marketing costs money (though far less than mass media marketing), a careful and calculated approach to every campaign is necessary.
Karington recommended sending an offer to a small segment of one's customer base before blanketing the area. For example, if one's database includes 10,000 customers, send the offer to 1,000 first and evaluate and record how well the offer worked.
If it was a winner, send the offer to 5,000, measure it again, and evaluate whether it should go to all 10,000.
If it was a dud, review your offer and the language of the letter (see resource list below for books on how to write compelling letters) and try again.
"Most people call doing this a hassle, but it's what gets the best results," said Voiles. "You've got to have the discipline and the database to make it work."
Though Karington sold both his pizzerias several years ago, he said one unit has continued to use the very same letters and offers he created five years ago.
"Once you've found something that works, it's a cookie-cutter approach from there on,"
he said. "Still, this stuff never happens over night. It takes time, and you've got to be persistent with it."
If operators need motivation to expend the effort and spend the money on the dirty work of database marketing, Cavalloro said they should consider every customer's lifetime value to their business.
For example, if an average customer spends $400 a year on food and drink in a pizza business, and if that customer stays loyal for just five years, he's a $2,000 asset to that business.
"Could you justify spending $50 to acquire this $2,000 asset? Of course, that's a no-brainer," Cavalloro said. "Could you justify spending $100? Sure.
"If you look at customers as little piles of gold walking in and out the door they take on a new meaning."