Self Promotion, With a Cooperative Twist

Dec 3, 2009

While exposure is great and many shops pride themselves on being able to “get ink” in the magazines and on websites, justifying the cost of advertising in consumer publications is a bit more difficult to determine.

Return on investment isn’t always as simple as submitting an ad and waiting for the phone to ring. These days, there are so many ways car owners can find out about your shop that it isn’t that easy to decide which method is the most effective. This is particularly true if you attend shows, display at events, have a Yellow Pages listing, participate in SEMA, create press releases or have them done, maintain a website for your shop and have cars you’ve built appear in the magazines on a regular basis. All of these methods-in addition to buying advertising space-have been well documented, but to paraphrase the pharmaceutical companies, Who do you ask to find out if advertising is right for you?

Here’s one innovative solution.

B Rod Or Custom, an established Knoxville, Tenn., builder of hot rods, customs and muscle cars, is a family affair. Larry Burchett, longtime automotive craftsman and business entrepreneur, gave his son, PJ, more than just a love of cars, instilling in him the same ingenuity and attention to detail that made his father a known quantity throughout the Southeast and beyond. While PJ has attended to the creative side of the business, the elder Burchett has been occupied with the business end of things. With Larry’s focus on improving B Rod’s performance as it relates to finance and not horsepower, he had an idea: one that had not been done before, or if it had occurred to someone to do the same, it probably had been eons ago.

A COOPERATIVE EFFORT

What it was that Larry devised was a different form of co-op advertising.

Most dealers and shops are familiar with co-op, where additional discounts are extended by manufacturers or a payment made for including their logo or featuring their products in advertising. Some retailers have it down to a science, where they have vendors pay the print bill on their catalogs, or at least the portion of the ads where their logo and products are featured.

According to Burchett, that’s fine except that most of these types of ads look a lot like the manufacturer’s ads, and he was more concerned about raising awareness of his shop than simply selling parts. The more he thought about it, the idea of banding together with others locally to form their own co-operative-”something more common to those in the building trades-seemed like a good idea.

Burchett approached an upholsterer he often uses, Pro Auto Custom Interiors in Knoxville, and a local hot rod parts dealer, Performance Products, also in Knoxville, and they formed an advertising group to place their ads in three Buckaroo Communications magazines: Super Rod, Rodder’s Digest and Chevy Rumble.

Unlike a partnership, the businesses are still separate entities, and advertising jointly doesn’t commit them to having to use the others’ services or parts exclusively. This was simply a means to reduce their advertising expense, while at the same time gain nationwide exposure and possibly work outside their area.

While he says it was a great concept and one that did gain exposure along with getting the phones to ring, there are certain aspects that Burchett would do differently the next time around.

MAKING IT WORK

When we caught up with Burchett he was putting the final touches on B Rod’s new home, an expansive shop that gives the B Rod team room to do more. Much of his time has been spent in the planning and relocation, along with attending to another unrelated business. This caused him to put the advertising program on hold, but the opportunity to discuss it with Restyling gave him a chance to think about it, and reformulate exactly what he would do with the program going forward. Here’s what he told us:

  • Put it all in writing. As simple as this sounds, it will prevent misunderstandings down the road, and in some cases can preserve longstanding business relationships.
  • Discuss in detail how the advertising program will work. Does each participant pay an equal share of the expense? Don’t forget to add in the cost of the ad, spots or banners themselves; someone will have to do the ad creative, and if one company contributes this service it should be taken into account when discussing the total program cost.
  • Decide what media will be used, how often, and at what cost. This is especially important if one or more companies have not advertised previously, or have only done so locally. They may be familiar with the cost of a Yellow Pages ad for example, but not with the cost of magazine print ads, radio spots or banners on websites. Christina Berry, the co-op’s advertising representative from Buckaroo, advised the group as to what size, color and frequency would best suit its needs; from her recommendations the co-op decided on the 1/3-page, black-and-white ad that ran in the magazines.
  • Each participant puts up the money when the budget is approved. There must be agreement on how the bills will be paid. If one party is going to assume the lead and signs the advertising insertion orders, that person should hold the money. Alternately, you can set up revolving billing if all the funds aren’t available at inception, or if there’s any question of fiduciary responsibility. Discussing it ahead of time with your ad reps can alleviate problems later.
  • Distribute tear sheets or affidavits promptly. Make sure all the participants are in the loop and that they are getting magazine tear sheets and affidavits to verify that the ads have run. The reps should do this for you, but don’t assume they did-get the results in the hands of your compatriots as soon as you have them.
  • Communication is key. Keep each other informed about the calls you receive, and they will do likewise. If only one of the shops is getting the bulk of the calls, this may not work well for everyone concerned, and it’s better to be honest about the results you’re getting. The ads might need to be modified in order to help one partner or another. Results may vary depending on season, or if there are a number of vehicles that need only one service and not the others.
  • This is business, it’s not personal. Unlike a true partnership, this is a “marriage of convenience,” where any member is allowed to work with others, or to decide not to continue after the initial agreed-upon period of time or contracted media schedule. Having been exposed to this type of consortium, it may be that one or all the companies choose to enlist someone else the next time around; don’t take it personally, and move on. Determine where more balanced results could be obtained if you decide to try it again, or if you are looking for new participants.
  • Don’t forget the other marketing aspects. Even if the advertising program results in lots of calls and more business for everyone, don’t rely on this one avenue as your sole method of reaching consumers. The shows you attended and events where you display, flier cards, donations to local car clubs and updating your website, these are all important parts of the marketing mix that should not be ignored.

PROS & CONS

Steve Holcomb of Pro Auto Custom Interiors, said, “We didn’t seem to get many calls from the ads, and I can’t say anyone saw our ad and called. If people want to reach us, they ask around. Most of our business is by word of mouth. This has worked better for us than ads or displays at the events. At most shows, we have enough cars we’ve done out there anyway.”

Performance Products’ Terry Anderson added, “I actually tried to talk him out of doing it; and then he started, so we went with him.

“We built our business locally, in the Knoxville area. We’re not out to compete with the big national warehouse distributors, but we do a good job in our area providing customer service. We advertise on Comcast locally, and we did try the Internet before, but pulled out of that when we found they were literally giving stuff away. Now we’ll stick with what we know, concentrate on the local rodders, most of whom are 45 or older with good jobs, kids that are grown, and that are having fun with their cars and don’t have to worry about the economy. These are the customers that helped us grow from my garage to our present 16,000-sq.-ft. facility, and this is what we’ll continue to do.”

Planned carefully, adequately funded, with the right creative and proper administration, this form of co-op advertising can work well for all the participants. It lowers the cost of “admission” to national magazines, makes radio affordable and opens up the most active websites.

In a tight economy, it could mean the difference between being able to advertise or not.