Quantcast
Jump to content


Recommended Posts

Budgets.thumb.jpg.bc1a777aed82ab5aa396f09a2f75274e.jpg

Somebody recently sent an email to me asking the same question that I get dozens of times every single month. Basically, it says, "Ron, how much should I budget for my marketing?"

I have a very simple answer to that. One that actually a lot of people are gonna totally disagree with me...

My answer is, throw out the marketing budget. You do not need a marketing budget, and here's the reason why: A lot of times, I've heard five, six, or even three percent of your growth sales should be used towards advertising.

Now, that might be a good number for some months, but it's a horrible number for other months. But if you're budgeting and you're only gonna have a certain amount of money for marketing every single month, your business is gonna be going to be heading on a downward slope.

For a lot of our clients, the summer months tend to be their busiest month. They don't need to be spending a lot of money on marketing at all during those months because they're just naturally busy. But then when the kids go back to school in August and September, everything screeches to a halt.

So I'm gonna say throw out the marketing budget and spend it where and if you need it. You don't need to spend a lot of money on marketing if you're naturally busy. You do need to spend a lot of money on marketing if you're gonna be slow.

Now, this goes to ... I guess I should mention, it's not a matter of just throwing a bunch of money out there on marketing. You have to do good quality marketing. You have to have the right message sent to the right market at the right time using the right media. In other words, a way that they're actually gonna see your marketing. You have to get all of those things straight.

So I'm going to probably guess that if you follow me and participate in my Car Count Daily campaign by watching my videos, you're getting a good idea, a good sense of what good quality marketing is. I'll assume that you're doing good quality marketing.

Now, if you're spending money on good quality marketing, you're gonna get good results. If you don't need it during the summer months, slow it down. If you're gonna need it in the fall, you need to raise it up. I don't like marketing budgets for that reason, because everybody gets used to spending the same amount of money every single month, whether they need to or not.

Pay attention to your numbers. Pay attention to what your shop is telling you. Pay attention to what your car count's telling you and spend the money when needed.

Also, if you're running short of your numbers, you may need to spend a lot more money and put in a lot more effort on your marketing for those specific months. Don't look at marketing as an expense. Look at it as an investment. A marketing budget is something to be spent. Marketing investment, your marketing dollars if it's done right, is actually an investment. It's not taking money, it's actually attracting more money to your shop.

  • Like 2
Link to comment
Share on other sites

Ron,

I'd like to hear your thoughts on actually advertising more when you're busy and less when your slow. On the surface that sounds like a terrible idea, but I once heard someone explain it as follows. If you're always slow every November, why would you spend all your advertising dollars in November if people just simply aren't spending money on their cars (instead, they are probably spending money on holiday items/events). However, if you are busy in July and people are spending money, that's the time to run your specials and advertise.

Up until this year, I agreed with your point of view, but since I had it explained to me this way, it really got me rethinking my advertising. It also makes sense with how you explained forgoing an advertising budget. However, if you take 7% as your advertising budget and base it off monthly sales figures, you should be fine in the slower months since your 7% is based on a smaller (monthly) budget, and not your annual figure.

I've also noticed the same theory in big box stores. BBQ pits, lawn mowers, and lawn furniture all go on sale in the spring and summer months. Holiday decorations for halloween and christmas go on sale in the fall and winter, along with coats, jackets, and hand warmers.  

Link to comment
Share on other sites

  • 2 weeks later...

I think there is a problem with the "no marketing budget" idea and mmotley just brushed it.  mmotley mentioned annual sales vs monthly sales. Here's my thought, if you have a marketing budget based on ANNUAL sales then you have money planned to work with.  Instead of saying your monthly sales are $25,000 so you should spend $1750 and the in the slow month your monthly sales are only $15,000 your marketing should be $1050, if you base your ANNUAL marketing budget on your ANNUAL sales then you bank the money in the $25000 month and spend it in the $15,000 month.  By basing your marketing budget on your annual sales you have the budget and get to spend it when you need to.  You also should remember, just because you have the budget doesn't mean that you have to spend it all (spend it just to spend it) or can't spend more if needed.

Link to comment
Share on other sites

  • 2 weeks later...

What has worked for me is absolute consistency. My mailers go out monthly like clockwork, and haven't skipped a beat in over 5 years. There are some months that are busier than others, but overall we're much more even keeled than we were before I did this. Being slow in February doesn't mean you should spend money on marketing in February. It's too late by then. The money needed to be spent in December so your marketing can be in their hands right when the slowdown begins.

I also went with a percentage of my sales as a budget, sort of. I budgeted the percentage of the sales that I wished I had, not what I was currently doing. It hurt, but it was effective.

Link to comment
Share on other sites

  • 7 months later...

Like AndersonAuto we run the same ads every week, regardless of what's happening in the bays. Consistency is key in marketing. Adding in a few Blitz advertising campaigns for holidays, vacation travel, season changes will help push some more cars into your shop, maybe. One shot ad wonders at random are a waste of money IMO.  The trouble with percentages is a new shop with $500k sales needs to spend 10% to reach out effectively. A $5m shop can spend 1% to get the same exact coverage, and it is highly dependent on location. Most shops can't possibly buy ads for what I can in my rural area. A radio spot for $5 here costs $500 in some markets. But then again I'm advertising to 5,000 listeners vs 500,000. 

Link to comment
Share on other sites

12 hours ago, alfredauto said:

"...we run the same ads every week, regardless of what's happening in the bays. Consistency is key in marketing."
 

Where do you do your marketing to? New customers or existing customers"

If to new customers, do you do newspaper, billboards, bus wraps, coupon mailers, or ???

How old is your shop?

What is your market demographic? - size, age, income

How many other shops are there?

I do nothing that I don't expect to run at least 3 times.  Different offers perhaps but the same action at least 3 times before I consider any judgment of whether it worked or not.  I agree that a large shop can run a smaller % and get the same reach which really makes it hard on the little shop to grow, but that is the way it is. 

 

You mention radio, do you advertise on radio?  If it was $5 a spot, even a 15 second spot I would be all over that.  But in my area it hasn't worked, not in my experience.  Granted the radio I tried didn't have a good administration staff so the consistency wasn't really there, but I never got a single person mention my radio ads.  Not even existing customers.  So I refuse when radio stations call now. 

 

My experience aside, one bit of advice I was told years ago was to record what stations your customers' radios were tuned to.  Maybe check a few presets but pay attention to which station they were listening too.  That way you knew what station to advertise with to get the kind of customers you wanted.  I mean, if you have a customer and you want more of them, if you have 5 and 3 listen to the same radio station, then that appears to be the station that kind of customer is most likely to listen to.  Of course I don't do that because radio in my area hasn't worked for my shop, but if it works for you, great and here's a little something to consider.

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Available Subscriptions

  • Have you checked out Joe's Latest Blog?

         0 comments
      It always amazes me when I hear about a technician who quits one repair shop to go work at another shop for less money. I know you have heard of this too, and you’ve probably asked yourself, “Can this be true? And Why?” The answer rests within the culture of the company. More specifically, the boss, manager, or a toxic work environment literally pushed the technician out the door.
      While money and benefits tend to attract people to a company, it won’t keep them there. When a technician begins to look over the fence for greener grass, that is usually a sign that something is wrong within the workplace. It also means that his or her heart is probably already gone. If the issue is not resolved, no amount of money will keep that technician for the long term. The heart is always the first to leave. The last thing that leaves is the technician’s toolbox.
      Shop owners: Focus more on employee retention than acquisition. This is not to say that you should not be constantly recruiting. You should. What it does means is that once you hire someone, your job isn’t over, that’s when it begins. Get to know your technicians. Build strong relationships. Have frequent one-on-ones. Engage in meaningful conversation. Find what truly motivates your technicians. You may be surprised that while money is a motivator, it’s usually not the prime motivator.
      One last thing; the cost of technician turnover can be financially devastating. It also affects shop morale. Do all you can to create a workplace where technicians feel they are respected, recognized, and know that their work contributes to the overall success of the company. This will lead to improved morale and team spirit. Remember, when you see a technician’s toolbox rolling out of the bay on its way to another shop, the heart was most likely gone long before that.
  • Similar Topics

    • By Joe Marconi

      Premium Member Content 

      This content is hidden to guests, one of the benefits of a paid membership. Please login or register to view this content.

    • By Joe Marconi

      Premium Member Content 

      This content is hidden to guests, one of the benefits of a paid membership. Please login or register to view this content.

    • By carmcapriotto
      Thanks to our partners, NAPA TRACS and Promotive
      In this episode of Business by the Numbers, Hunt explores the benefits and considerations of owning your auto shop's real estate. Learn about financing options, affordability, and real-life examples to help you make an informed decision.
      -Understand different financing options for purchasing real estate.
      -Assess your shop's ability to afford property ownership.
      -Learn the long-term benefits of owning your business premises.
      -Real-life examples to illustrate key points.
      
      Thanks to our partners, NAPA TRACS and Promotive
      Did you know that NAPA TRACS has onsite training plus six days a week support?
      It all starts when a local representative meets with you to learn about your business and how you run it.  After all, it's your shop, so it's your choice.
      Let us prove to you that Tracs is the single best shop management system in the business.  Find NAPA TRACS on the Web at NAPATRACS.com
      Paar Melis and Associates – Accountants Specializing in Automotive Repair
      Visit us Online: www.paarmelis.com
      Email Hunt: [email protected]
      Get a copy of my Book: Download Here
      Aftermarket Radio Network
      Click to go to the Podcast on Remarkable Results Radio
    • By carmcapriotto
      Thanks to our partners, NAPA TRACS and Promotive
      In this episode, Hunt explores the crucial difference between profit and cash flow. Learn why your high profits don't always translate into more cash in the bank and how to better manage your shop's finances.
      Difference Between Profit and Cash Flow: Understanding why profit and cash flow are not the same and how this affects your financial planning. Accounts Receivable Impact: How the timing of your transactions can create a lag between recording a profit and actually seeing the cash. Managing Inventory: The effects of inventory purchases on your cash flow and strategies to manage it effectively. Fixed Assets and Liabilities: The impact of major purchases and financing options on your cash reserves. https://www.tn.gov/revenue/2024franchisetax.html  
      Thanks to our partners, NAPA TRACS and Promotive
       
      Did you know that NAPA TRACS has onsite training plus six days a week support?
      It all starts when a local representative meets with you to learn about your business and how you run it.  After all, it's your shop, so it's your choice.
      Let us prove to you that Tracs is the single best shop management system in the business.  Find NAPA TRACS on the Web at NAPATRACS.com
      Paar Melis and Associates – Accountants Specializing in Automotive Repair
      Visit us Online: www.paarmelis.com
      Email Hunt: [email protected]
      Get a copy of my Book: Download Here
      Aftermarket Radio Network
      Click to go to the Podcast on Remarkable Results Radio
    • By carmcapriotto
      Thanks to our Partners, NAPA TRACS, AutoFix Auto Shop Coaching, and Today's Class Brin Kline shares his journey from technician to successful shop owner, highlighting the crucial role of his business coach, Bill Haas. They delve into the importance of having an accountability partner, the role of coaching in reducing stress, and how personalized guidance can help shop owners reach their full potential. Perfect for shop owners looking for insights on business coaching, this episode is packed with valuable advice and industry wisdom. Brin Kline, Shop Owner, Assured Auto Works, Melbourne, FL. Brin's previous episodes Bill Haas, Haas Performance Consulting, Bill’s previous episodes HERE. Show Notes
      Coaching in the Industry (00:01:15) Discussion about the importance of coaching in the automotive industry and the value of having a coach. Accountability and Coaching (00:07:49) The importance of having an accountability partner in coaching and its impact on business progress. Financial Security and Coaching (00:09:47) The relationship between financial security, goal setting, and coaching in business development. Business Goals and Budgeting (00:11:13) The significance of setting business goals and budgeting with the guidance of a coach. Selecting a Coach (00:13:50) Considerations for selecting a coach based on strengths and weaknesses. Affordability of Coaching (00:16:05) Discussion on the affordability of coaching and the potential benefits, even for struggling businesses. Personal Growth and Coaching (00:18:41) The importance of personal growth, humility, and willingness to change in the coaching relationship. Business changes and profitability (00:20:16) Discussion on increased profitability and the ability to make changes in the business. Gaining confidence and comfort (00:21:19) Becoming more comfortable and confident in making changes and taking action. Transition from technician to business owner (00:25:28) Concerns and challenges of transitioning from a technician to a business owner. Selecting the right coach (00:34:01) Factors to consider when selecting a coach, including industry passion and adaptability. Managing time and involvement in the industry (00:39:08) Discussion on managing time and involvement in various industry activities as a challenge. Team growth and dynamics (00:41:33) Discussion about the growth of Brin's team and maintaining a positive work environment. Commitment to the business (00:44:22) Brin's decision-making process and commitment to his business. Thanks to our Partner, NAPA TRACS NAPA TRACS will move your shop into the SMS fast lane with onsite training and six days a week of support and local representation. Find NAPA TRACS on the Web at http://napatracs.com/ Thanks to our Partner, Auto-Fix Auto Shop Coaching Proven Auto Shop Coaching with Results. Over 61 Million in ROI with an Average ROI of 9x. Find Coach Chris Cotton at AutoFix Auto Shop Coaching on the Web at https://autoshopcoaching.com/ Thanks to our Partner, Today's Class Optimize training with Today's Class: In just 5 minutes daily, boost knowledge retention and improve team performance. Find Today's Class on the web at https://www.todaysclass.com/ Connect with the Podcast: -Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Join Our Private Facebook Community: https://www.facebook.com/groups/1734687266778976 -Subscribe on YouTube: https://www.youtube.com/carmcapriotto -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on X (Twitter): https://twitter.com/RResultsBiz -Visit the Website: https://remarkableresults.biz/ -Join our Insider List: https://remarkableresults.biz/insider -All books mentioned on our podcasts: https://remarkableresults.biz/books -Our Classroom page for personal or team learning: https://remarkableresults.biz/classroom -Buy Me a Coffee: https://www.buymeacoffee.com/carm -The Aftermarket Radio Network: https://aftermarketradionetwork.com -Special episode collections: https://remarkableresults.biz/collections                                  
      Click to go to the Podcast on Remarkable Results Radio


  • Similar Tagged Content

  • Our Sponsors



×
×
  • Create New...