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Advertising
How Does Advertising Work?
Unlock the secrets to effective ads and a formula that drives real results.
I have a friend who is a famous online marketer. Last week he sent me an observation I found interesting. It occurred to me that you might find it interesting as well.
“Now that targeting is pretty much dead on Facebook and Instagram, I have a theory that the rules of reach and frequency that have always applied to radio will also apply to social platforms as they shift away from micro-targeting and toward looking more like mass media.”
[Frequency means repetition. – editor]
And then he asked a question.
“Can you remind me again what your magic formula is for reach and frequency when buying radio ads? I know this is a bit like someone asking me how to spell SEO, but this came up in a conversation I was having with a buddy the other day and I felt stupid that I couldn’t remember it.”
Happy to help. Here’s what you’re looking for:
APE = Advertising Performance Equation
Share of Voice x Impact Quotient = Share of Mind
Share of Mind x Personal Experience Factor = Share of Market
Share of Market x Market Potential = Sales Volume
1.Share of Voice: How much of the noise in your category in your marketplace is your noise? (All media combined, including word of mouth)
2.Impact Quotient: The average impact of a message in your category is 1.0. If your ads are 30% better than average, you score a 1.3. If your ads are 10 percent weaker than average, you score a 0.9 … the Impact of your message can accelerate or reduce your Share of Voice
3.Share of Mind is the percentage of real estate you own in your category in the mind of the average customer.
4.Personal Experience Factor is likewise measured with a 1.0 being, “exactly the experience your customer expected.” Anything above a 1.0 is a delight factor. Anything below a 1.0 is depth of disappointment. Online reviews are just measurements of a customer’s Personal Experience Factor
5.Share of Market is your sales volume as a percentage of the total sales available in your category, in your marketplace.
For a message to enter Declarative Memory (mid-term memory – longer than Working Memory – but not yet Procedural Memory, which is involuntary, automatic recall,) a message should be repeated to the same individual at least 3 times within 7 night’s sleep. Further research has lowered this number to as little as 2.5 repetitions per week.
The more memorable the message, the less repetition is required. Therefore, the only way to beat the system (Google) and save money is to create messages that are highly memorable. NOTE: Any limited time offer with a call-to-action is erased from declarative memory when the “limited time” window is closed. This is why you cannot build a brand with Direct Response calls-to-action.
To become a household word and enter long-term Procedural Memory, you need to hammer your message into the mind of your target at least 2.5 per week for at least 3 years. But even then, it will fade within 24 months after your ads disappear, assuming that your ads have only the average 1.0 Impact Quotient. But a message – or an experience – with a significantly higher Impact Quotient can enter Procedural Memory and become automatic, involuntary recall, with only a single repetition. PTSD is an example of this.
The key to absolute category dominance is to elevate your Impact Quotient and Personal Experience Factor to numbers above 2.0.
In other words, you’ve got to have awesome ads and deliver an amazing customer experience.
But you already knew that.
“This is perfect. Thank you. Have any of your partners tested APE in social ads (FB, IG, TikTok, etc.) to see if the numbers hold up? I would have to assume that Share of Voice would be difficult to lock down given that the media is so mass and it’s obviously easier to scroll past a social ad than it is to skip a radio ad, but it would be interesting to run an impression campaign set at 5 impressions per week (2X the 2.5) to see how long it would take to move the needle on overall leads and sales.”
We haven’t tested the APE online. You get to be the official pioneer.
“Game on.”
ONE LAST THING: The reason that so few people lift their companies to the level of category dominance is that they chicken out, pull the plug and proclaim, “That didn’t work.”
Messages written to accomplish Customer Bonding don’t work immediately. Building a relationship takes time.
If you are conditioned to seeing urgent, direct-response ads deliver quick results, you will soon become convinced that your Customer Bonding campaign isn’t working.
The majority will bail out within the first 4 months. I’ve seen campaigns take as long as 7 months before they emerge from the darkness into the sunlight. But once you reach breakthrough, your Customer Bonding campaign will work better and better the longer you keep moving your message forward. And then you wake up one morning and the competitor in second place is so far behind you that they don’t even show up in your rear-view mirror.
Game over.
Book a call with Ryan Chute of Wizard of Ads®, and we’ll hook you up.
Advertising
Your Low Conversion Rate on Pay-Per-Click
Targeting the right customer vs. reaching the masses: Which approach works best for your business?
When I was growing up, I could never change the opinion of my mother by saying, “But everyone else is doing it.”
My mom had the courage and confidence to believe that Everyone Else’s mother was wrong.
That’s a high level of courage and confidence. I’m hoping that you have it, too.
When I speak to advertising professionals on the subject of advertising, I often find myself having to explain how certain widely-held beliefs are wrong. I will patiently produce the evidence, the case studies, and scientific documentation. In most instances, the audience will concede that I am right. Then someone will say, “But everyone else is doing it,” as though it is impossible for “everyone else” to be wrong.
Here’s an example: most people believe in tightly targeting the right customer. They are convinced that the secret of successful advertising is to “reach the right people.”
I believe targeting is essential if you are in a business that sells to other businesses.
If you sell computer chips, you need to reach computer manufacturers, so send a letter, an email, a salesman to knock on their door. If you sell cardboard boxes by the traincar load, you need to reach companies that sell things packaged in cardboard boxes. Send a letter, an email, a salesman to knock on their door. The world of B2B lives and dies with their ability to “reach the right people.”
But when you are selling a product or service to the public, “targeting the right customer” works only about 10% better than reaching the untargeted masses.
If the cost of targeting is less than 10% higher than the cost of not targeting, go ahead and target. But I am confident you will find that targeting usually costs considerably more than that.
“But everyone else is doing it.”
Please excuse me while I bang my head against the wall.
- Nielsen is the highly scientific organization that measures television and radio audiences.
- D2D is cloud based, and leverages open source technology designed to collect, manage, and analyze complex data.
- Les Binet is a highly respected data scientist.
In the summer of 2020, Les Binet published a huge, long term study on the effectiveness of marketing. Here is one of the many things he learned:
“In many ways, online marketing and online media has done itself a disservice by focusing on targeting more than reach. A couple of very interesting studies are out there. One was a study by Nielsen, about the relative contributions of reach versus targeting in effectiveness, and they concluded, with a survey of about 500 econometric models, that targeting only adds about 10% to the effectiveness of the campaign on average. A very similar result came from some work by D2D, where they looked at over 200 econometric models, from a wide range of categories, and they concluded that targeting of a campaign adds only about 10% to effectiveness. So the same numbers, two very different methods.”
Have you been following the news about Phenylephrine, the decongestant that was proven to be ineffective in 2007 and in multiple studies since then, but is still on the shelf 16 years later?
According to a recent news story by Sarah Zhang,
“Americans collectively shell out $1.763 billion a year for cold and allergy meds with phenylephrine, according to the FDA, which also calls the number a likely underestimate. That’s a lot of money for a decongestant that does not work.”
Generally speaking, I’m in favor of government staying out of the way of business, but this seems to be a case where the Federal Trade Commission might ought to step in and say, “Guys, you need to quit lying to the public.”
“But everyone else is doing it.”
One last example: Google, LinkedIn, and every other seller of pay-per-click will aggressively argue that you need to include their “expanded network” to achieve the lowest cost-per-click. What they are telling you is absolutely true as long as you don’t mind paying for clicks by bots.
Industries with the highest rates of click fraud include photography (65%), pest control (62%), locksmiths (53%), plumbing (46%), and waste removal (45%). [data provided by clickcease.com]
Let me be clear: I do not believe – even for one second – that Google or LinkedIn or any other major seller of pay-per-click advertising is directly involved in a scheme to sell bot-clicks. But have you ever looked into exactly who and what constitutes an “expanded network?” You really should, and I hope you will. When you have gathered the facts, I believe you will probably opt-out of all the expanded networks offered by the major sellers of pay-per-click.
But please know in advance that when you do this, alarm bells will go off and each of those sellers of pay-per-click advertising will tell you that I don’t know what I’m talking about and they will passionately argue that you are making a horrible mistake because, “everyone else is doing it.”
Did you know there are a variety of services that can identify, track, and block bots from clicking your online ads?
You didn’t know that? Well, it’s probably because, “no one else is doing it.”
There are more than 6 million businesses in America, but the largest of those bot-tracking and bot-blocking companies [cheq.ai] has only 15,000 customers.
I’m convinced the sellers of pay-per-click ads are perfectly willing to let you buy bot-clicks from their expanded networks for the same reasons that all the drug companies are willing to sell you Phenylephrine.
It is entirely possible that I am a cranky and catankerous old man, and that everyone else is right.
So I’ll let you look into these expanded networks and decide for yourself.
Does that sound fair?
Book a call with Ryan Chute of Wizard of Ads®, and let's create those mind-blowing ads.
Lead Generation
Not Everything is Scalable
Anything that works quickly, will work less and less well the longer you do it, do you agree?
Ninety percent of motorcycle riders who attempt this corner at 100 mph crash and die, so 9% of riders who attempt it at 10 mph will also crash and die, right?
The fact that you answered silently ‘No’ indicates that you instinctively understand the concept of an inflection point.
Somewhere between zero and 100 mph is the inflection point where crashes begin to occur, and every mile-per-hour above that inflection point increases the likelihood of a crash.
Although we instinctively understand the reality of the inflection point when reducing from the greater to the smaller, we somehow believe things are infinitely scalable when moving from the smaller to the greater.
If we can navigate the corner at 77 mph, then we can do it at 78 mph. And if we can do it at 78 mph, we can certainly do it at 79 mph. And if 79 is doable, then so is 80, right?
I’m talking to you about lead generation for your business.
A few days ago, I was having a conversation that I find myself having far too often. I have an acquaintance in the air conditioning business who told me he was planning to increase his Google budget. He said,
“If I increase my Google budget by 50%, I’ll get 50% more leads.”
He’s been in business about 11 years and is a major player in his city, so I asked, “During peak season, how many calls do you get on the average day?”
He told me the number, then I said, “Now think of all your competitors and estimate the number of calls they could possibly be getting. Give it some thought. Don’t leave anyone out.”
I gave him time to think, then said, “Add that call volume to your call volume. Now tell me, what is the largest possible number of people that could possibly need air conditioning service during peak season?”
He gave me a number. I asked, “Is there any way it could be higher than that?”
“No.”
“Peak season has been over for awhile. How many clicks are you currently buying each day?” His eyes got big and he said,
“I’m already buying more than 3 times that many clicks every day! How is that possible?”
“Are you asking me how it is possible that a finite number of people in your city are in the market for your product today, but the number of clicks available today is infinite? Is that what you’re asking?”
He shook his head yes, so I told him the answer.
I run into the same problem when talking to clients about radio ads. They say,
“Every time I have increased my radio budget, my sales have increased. So I want to increase my budget again.”
“It won’t do you any good.”
“But it has always worked in the past.”
“It won’t work this time because you are already reaching all the people who spend enough time listening to the radio each week to make it possible for you to reach them with sufficient repetition. The only people left are the ones who don’t spend enough time listening. We’re going to have to add a new media: TV, or billboards, or maybe direct mail.”
“Will it work as well as the radio?”
“Of course not. Because we’re at an inflection point.”
“What do you mean?”
“You’re already reaching 39% of your city with enough repetition for those people to know who you are and what you do and how you do it and why they should choose you. So whatever media we buy next, you’ve got to keep in mind that we’re already reaching 39% of those people with relentless repetition on the radio. The best-case scenario is that you’re going to see about 60% as much business growth per ad dollar as you’ve seen in the past.”
No one wants to hear that.
People want to believe that everything related to business is infinitely scalable. But there is always an inflection point when lead generation becomes more expensive.
The happy times are when you reach that glorious inflection point when things really begin to take off. Like when you are far enough into a 52-week TV or radio campaign for the public to have heard enough about you to finally start choosing to buy from you.
Sadly, this TV/Radio inflection point is usually somewhere between week 13 and week 26. Not always, but usually. Most advertisers don’t stay with it that long, because most advertising salespeople don’t have the courage to tell them it’s going to take that long.
The exception, of course, is when you have an urgent message about a limited-time offer. Those ads usually start working much sooner.
Problem solved, right? Just run direct-response ads with an attractive offer and a strong call to action!
But inflection points in advertising are funny:
- Anything that works quickly, will work less and less well the longer you do it.
- Anything that works better and better the longer you do it, will always seem, at first, like it’s not working at all.
Book a call with Ryan Chute of Wizard of Ads® today.
Advertising
Magical Thinking
The heart will follow the mind, once you've taken them somewhere they've never been.
If you win the heart, the mind will follow. The mind will always create logic to justify what the heart has already decided.
In 1981, Dr. Roger Sperry won the Nobel Prize for his documentation of brain lateralization, which basically says that we don’t have 1 brain divided into 2 hemispheres as much as we have 2 separate, competing brains.
The LEFT hemisphere is the home of rational, logical, sequential, deductive reasoning. Think of it as the Intellect; the Mind. It puts you in touch with this world and leans toward suspicion and doubt.
But the RIGHT hemisphere does none of those things. Think of it as the Heart. It understands the six sub-languages in the language of music; pitch, key, tempo, rhythm, musical interval and musical contour. The right hemisphere puts you in touch with a world that could be, should be, ought to be, someday.
HOPE is alive and well in the right hemisphere of your brain. It understands symbols, and assigns meanings to shapes and colors. The logic of the right hemisphere is intuition, gut feelings, and hunches.
Your body contains 100 million sensory receptors that allow you to see, hear, touch, taste and smell physical reality. But your brain contains 10,000 billion synapses. This means you are approximately 100,000 times better equipped to experience a world that does not exist, than a world that does.
Call 1-800-Got-Junk.
Life is happier
when it’s less cluttered.
Your house will be bigger.
Your teeth will be whiter.
Angels will sing.
You’ll be a better dancer.
Magical Thinking is a style of writing characterized by elements of the fantastic – woven with a deadpan sense of presentation – into an otherwise true story.
Now this is where it gets really interesting; the right hemisphere of your brain doesn’t know fact from fiction or true from false. That’s the left brain’s job. This is why you can enjoy books, movies, and TV shows that you know are fiction.
Magical Thinking is a style of writing that is full of HOPE.
Magical Thinking doesn’t talk about the frustration of a situation or the pain of a problem. It illuminates a happy world in which anything is possible.
Magical Thinking offers the customer an effortless, frustration-free solution.
Employees, your boss wants you to know:
“If you answer the phones for our company or knock on the doors of customers, please know that you are a vitally important part of the advertising and marketing team. Our customers expect you to be the living embodiment of our advertising; cheerful and helpful and magically able to make their problem disappear. We will become giants if we act like the company we claim to be in our advertising.”
Magical Thinking
makes
Magical Advertising
makes
Happy Customers
makes
Business Grow.
Book a call with Ryan Chute of Wizard of Ads® today.
Advertising
That Hovering Question Mark
Trigger a Question. A strong and effective narrative begins with a statement that provokes a multitude of inquiries.
Every good story – and every good ad – begins with a statement that triggers more questions than it answers.
“I do not like to turn left when leaving my neighborhood…”
“I was a 10-year-old boy holding a flashlight for my father…”
“You are sitting in a candlelit restaurant when you hear a strange noise…”
The second line of your story is where the narrative arc begins. The narrative arc is the sequence of events, the plot. [In a radio ad, sfx means sound effect]
You are sitting in a candlelit restaurant when you hear a strange noise
[sfx-open] and the walls are instantly covered with jagged shards of golden light.
You hear another strange noise
[sfx-close] and the jagged shards of light are gone.
Murmurs of wonder flood the candlelit restaurant.
[sfx-open] The jagged shards appear on the walls again, dancing in unison to some silent music that only they can hear.
[sfx-close] And now they are gone.
The crowd applauds this unexpected delight. Smiles are beaming. Teeth are bright.
[sfx-open] More jagged shards. More golden light.
[sfx-close] No one notices the man at the table in the middle of the room, staring at his tablecloth, lost in thought. A woman emerges from the shadows behind him. Startled, he looks up, drops to one knee,
[sfx-open] and the golden shards of light dance fast and bright across his face and hers.
And then they kiss.
And the candlelit restaurant explodes in applause.
[sfx-close] A tiny little box sits empty on the table.
Flickering Firelight™ diamonds, available exclusively at Morgan Jewelers.
Begin your ad with a statement that triggers more questions than it answers! If your opening line reveals what is to come, change the opening line.
“Guidomeyer’s Furniture is having a sale!”
When an ad begins with a sentence like that, you can be sure it was written by someone who follows the 5 W’s of journalism: Who, What, When, Where and Why.
Ads written by journalists are why most people hate advertising.
Guidomeyer’s Furniture is having a sale!
This week, Guidomeyer’s is having a sale
at 1715 Barkmaster Avenue! Save! Save!
Save up to 50% this week at Guidomeyer’s
annual clearance sale! Guidomeyer’s has been
serving the needs of Pottersville for 71 years,
so come to Guidomeyer’s and shop local
for all your furniture needs! We have recliners,
coffee tables, end tables, nightstands, TV trays
and financing will be available! Guidomeyer’s
Annual Clearance Sale! This week! 1715 Barkmaster!
Hurry, hurry, hurry before all the good stuff is gone!
Guidomeyer’s!
- Guidomeyer is who.
- A Sale is what.
- This Week is when.
- 1715 Barkmaster is where.
- Annual Clearance is why.
That formula is so simple an idiot could use it. And idiots often do.
No, I don’t mean that. Words have meanings, so let me be accurate. I don’t think such a person is an ‘idiot.’ ‘Moron’ would be the accurate term. Technically, a moron is an adult with the mental age of 7-10. Morons are more intelligent than idiots and imbeciles, but they are an especially troublesome group because they are not aware of their shortcomings.
Don’t be a moron.
Getting the listener’s attention is easy, but holding that attention requires skill.
- Open with a statement that triggers more questions than it answers.
- Bridge quickly into the narrative arc, the plot.
- When your listener thinks they know where you are headed, take them somewhere else.
- Introduce divergent elements that don’t belong together,
- then make them converge, add up, and make sense.
- Lead your listener to the conclusion, then allow them to discover it on their own. Don’t tell them the answer. Let them hear it in their mind.
- Leave out the irrelevant, the predictable, and anything that makes your ad sound like an ad.
Poetic meter makes words musical.
To achieve it, arrange the drumbeats of the stressed and unstressed syllables of your words so that they create a percussive rhythm in the mind. There are a couple of dozen rhythms that are easily achievable in English.
The simplest of those – anapestic meter – is two light stresses followed by a heavy third stress.
pum-pum-PUM-pum-pum-PUM- pum-pum-PUM-pum-pum-PUM
And his cohorts were gleaming in purple and gold;
And the sheen of their spears was like stars on the sea,
Like the leaves of the forest when Summer is green,
Like the leaves of the forest when Autumn has blown,
For the Angel of Death spread his wings on the blast,
And the eyes of the sleepers waxed deadly and chill,
And there lay the steed with his nostril all wide,
And the foam of his gasping lay white on the turf,
And so there lay the rider distorted and grey,
And the widows of Ashur are loud in their wail,
So I walk by the edge of a lake in my dream.
It is easy to become a musical writer. All you have to do is spend time reading the words of the great ones.
Don’t read ads. Read the poems, short stories and novels written by the winners of the Pulitzer and Nobel prizes in Literature.
“In the late summer of that year we lived in a house in a village that looked across the river and the plain to the mountains. In the bed of the river there were pebbles and boulders, dry and white in the sun, and the water was clear and swiftly moving and blue in the channels. Troops went by the house and down the road and the dust they raised powdered the leaves of the trees. The trunks of the trees too were dusty and the leaves fell early that year and we saw the troops marching along the road and the dust rising and leaves, stirred by the breeze, falling and the soldiers marching and afterward the road bare and white except for the leaves.”
– Ernest Hemingway, the opening lines of A Farewell to Arms
“I read that paragraph and I want to cry. It’s incredibly beautiful. He broke every rule. All the repetition! In four sentences the word ‘and’ appears 15 times. What’s going on is just an unforgettable display of rhythmic mastery. There’s a kind of, almost a kind of hypnosis, an incantation that is about the frame of mind you’re going into the war with.”
– Stephen Cushman, Literary Scholar
“Listening to Bach – and recognizing the repetition of particular notes in Bach – inspired Hemingway to write A Farewell to Arms.”
– Miriam Mandel, Literary Scholar
Take another look at Hemingway’s opening sentence and notice the questions it raises: “In the late summer of that year (What year?) we lived in a house in a village that looked across the river and the plain to the mountains. (Where are we?)”
You can do this. None of it is beyond you. Morons will tell you that you’re doing it wrong, but your ads will take your listeners on a marvelous journey, and your clients to heights that no other ad writer can take them.
Unless you work with seasoned marketers with rich experience writing irresistible advertising, like Ryan Chute’s teams at Wizard of Ads®. Book a call.
Human Resource
How to Recruit and Retain Good Employees
Companies with a strong culture attract talented employees seeking a sense of purpose and belonging.
Rugged individualism is the essence of America.
It is also the reason that we, as a people, feel isolated and lonely.
Our focus on personal, individual success is the reason we feel disconnected from one another. This is happening even in our marriages according to Ian Kerner, author of the book, So Tell Me About the Last Time You Had Sex, and Terrence Real, author of Us: Getting Past Me and You.
“Individualism is not a natural fact; it has a history. In American Colonial days, society was communalism on a small scale. It was about farms and small towns and small villages. When you lived face to face with your neighbor, it was a palpable reality that the good of all was the good for each of us. Civic virtue was the force that went beyond individual gratification. It was part of being a civilized person that you had a sense of civic virtue. With the Industrial Revolution, and the myth of the self-made man, all of that went by the wayside and it was each man for himself.”
– Terrence Real
We are living in a very conflicted time because most of us hold two conflicting beliefs. (1.) We believe in a culture of individual achievement, “ME”, (2.) but as we approach the zenith of a societal “WE”, there is a desire to find our tribe, to join, to belong, to work as a group for the common good.
Next year is the zenith of our current “WE.” It happens once every 80 years.
The previous “WE” zenithed in 1943 when America was united against Hitler. We threw ourselves into something bigger than ourselves; something we believed in, something that satisfied our need to belong and make a difference.
And now you know why we see all those deeply impassioned splinter groups in the news each week.
Here’s the good news: you can harness that same “need to belong” to recruit and retain good employees.
Good employees are attracted to companies with a strong culture. They are looking for a company they can believe in, a place where they can belong and make a difference.
When you want to strengthen your company culture, you need to publish your Unifying Principles. I have previously called these your “We Believe” statements.
Publishing them is the easy part. The difficult part is that you have to live them.
About eight minutes into his famous TED-X talk at Puget Sound, Simon Sinek says,
“The goal is not just to hire people who need a job; it’s to hire people who believe what you believe. I always say that, you know, if you hire people just because they can do a job, they’ll work for your money, but if they believe what you believe, they’ll work for you with blood and sweat and tears.”
To learn more about how we can help you, book a call with Ryan Chute of Wizard of Ads® today.
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Frequently asked questions
Questions? We’ve got answers.
Who does the Wizard of Ads® for Contractors work with?
Wizard of Ads® for Contractors work with healthy and growing Residential Home Service Contractors hungry to grow by multiples, like you.
You are ready, willing, and able to grow your business. You are open to change and are seeking a distinctive angle of approach to gain the time and attention of a too-busy public.
You know that lasting relationships take time, patience, and good energy to nurture and cultivate. We carefully enter into every arrangement with the intention of working with you for as long as you own your business. You prefer lasting partnerships.
You are already a solid operator. You have successfully grown your business and appreciate the impact the right brand story will have to get to the next level in your operation. You know a strong relational message takes time to gain momentum, but it’s worth the one-time short-term discomfort for the long-term gains.
Marketing cannot fix a failing business.
We accelerate what’s already happening in a business. If your business is on the rocks, marketing will only speed up the inevitable.
You’re focused on lasting change that leads to exponential, profitable growth, not just sales at any cost. Intuitively, you know that communication that enhances every element of your customer's experience and your employee's culture is the key to your success.
How does the Wizard of Ads® for Contractors charge?
Traditional marketing agencies are designed to capture the greatest amount of revenue from a client, regardless of results. Every last item is billed and expensed to the client. Typical agency fees can represent a whopping 55% of the entire advertising budget. That means a $5 million dollar advertising budget, you would spend $2.75 million on agency fees.
Think of Wizard of Ads® for Contractors as the Anti-Agency.
Our income is not tied to your advertising budget. Our income is exclusively tied to your growth. Our goal is to maximize your advertising impact with the lowest reasonable spend. This allows you to spend only what is necessary or to put extra horsepower into aggressively growing in your market.
The genius of this model is that it perfectly aligns our motivations as true partners for exponential profitable growth without the pain of being unaffordable. Ultimately, we are confident in taking the risk of being underpaid in the first few years because we know the results always speak for themselves.
Next, we do not accept commissions, referral fees, kickbacks, or other compensation from any service providers we recommend or engage for production work. Most agencies do. This includes the 15% agency commission for media buying. This approach is considerably different from the compensation plan employed by most advertising agencies, as it eliminates any potential conflicts of interest and allows us to focus our entire attention on helping you grow your business profitably as a true partner. For example, a $500,000 annual media buy would involve a $75,000 commission that we would have removed directly from your media providers' invoices.
This is the perfect pricing model for Residential Home Services.
By tying ourselves to gross revenue, we only have one motivation. Your motivation. We have no motivation to convince you to spend more money on marketing than what is necessary, and since we are a variable expense to sales, we NEVER become too expensive to have us on your team.
In almost every case, we end up lowering the amount of money you spend. We will stay within your planned marketing budget, including your media spend, production, and our Annual Fee. Add on the fact that you get any and all commissions back for media buys and various services provided by outside providers, and you will actually save money having us on your team.
Don’t forget, we have the largest buying power in North America for media buying, meaning for every dollar you spend buying media, we only spend 27 cents on average. This stretches your reach, impact, and frequency in a way no other agency (or yourself) can achieve on your own, saving you hundreds of thousands of dollars, eventually millions, every single year.
Clients who heed our advice and embrace our Marketing Strategy quickly add $1 million in incremental revenue to their business, making your investment a smart bet and a bit of a no-brainer.
There is no longer any guesswork, hope, or fear that our marketing strategies are going to work. If our client’s are able to abandon any limiting beliefs about marketing, deliver operational excellence, and play the long game, our marketing strategy will accelerate their profitable growth.
Wizard of Ads® for Contractors pricing model is based solely on the topline revenue of your company. It consists of an Upfront Fee and an Annual Fee. These fees are inclusive of scheduled travel, services, and all other expenditures as outlined in the Consulting Agreement.
The Upfront Fee covers the intensive Uncovery Process, the first year’s Media Buy, the Creative Process, and the Market Research while the Annual Fee goes toward implementation, ongoing creative and consulting, and next year's media buy. You get a team of 3.5 people, with direct access to a top tier Creative Lead and Media Buyer, and on-demand access to me as your Master Strategist. You will also have a full-time Account Manager keeping everything on track.
While the upfront does have an initial pinch, it is easy to amortize the investment over the many years we will be working together to grow your business. Wizard of Ads® retain clients for 10 years, on average. The sale of the business is the number one reason for termination. We actively terminate the bottom 1% of clients who are unwilling or unable to follow our strategies.
Wizard of Ads® for Contractors believes that all rewards should be directly correlated to the success of our clients. This means that the Wizard of Ads® for Contractors only receives a raise when the company achieves growth. For example, if your gross sales for the year have increased by 25%, the Annual Fee you pay us in the following year will also be increased by 25%. Likewise, if your gross sales decrease, our Annual Fee will decrease by the same percentage during the following year.
This is an exceptionally easy and fair way to track and reward success. This model was developed by Wizard of Ads® over 35 years ago and has served us well because it serves our clients well.
As a rule of thumb, we take the risk of working for considerably less than our actual value in the first few years as we help accelerate growth. This means you need to be willing to pay us exceptionally well when you start doing even better.
When should I engage The Wizard of Ads® for Contractors?
There are four key revenue stages for engagement with the Wizard of Ads® for Contractors.
- Under $3.6 million in revenue
- Between $3.6 and $10 million in revenue
- Between $10 and $20 million in revenue
- Over $20 million in revenue
Under $3.6 million in revenue is an investment in your brand. This will serve you well in establishing your brand story early on and help you with your name, logo, and truck wrap design. It's easier to create pictures from a story than it is to make a story based on pre-drawn pictures. You'll be glad you did. Everyone on a fast path to growth is.
Most clients start with Wizard of Ads® for Contractors between $3.6 and $10 million in revenue. They have often seen a natural ceiling with their leads for demand service and are looking for ways to push past the ceiling. This can only be done with a properly executed brand strategy, specifically in mass media with a sticky story.
Between $10 and $20 million in revenue, Wizard of Ads® for Contractors has some natural economies of scale. This is a sweet spot where Wizard of Ads® for Contractors can offer some added value in getting the ball rolling.
Over $20 million in revenue is actually the lowest cost point of entry as a percentage of revenue, but not the cheapest time to start with the Wizard of Ads® for Contractors. Leveraging all economies of scale aside, we have been left out of the upside along the way, so engaging when over $20 million in revenue means we have to mend a lot of fences damaged along the way. This is also where clients see significant savings in their media buys and production costs.
There are also three market sizes to consider.
- Primary Markets are the top 50 cities in America.
- Secondary Markets are the smaller cities in America.
- Tertiary Markets are the more rural trade areas in America.
When considering an engagement with The Wizard of Ads® for Contractors, consider what size market you are in. For example, a $3.6 million company in a Primary Market will struggle to get the necessary reach needed to make a splash. You either have to be more patient than a larger company or spend more money to accelerate your reach.
Alternatively, a $5 million company in a Secondary Market will look like a pretty darn big fish in a medium-sized pond.
A $20 Million company in a Primary Market will feel like a $50 million company using our strategies to potential customers.
The key to remember is that the earlier you start with the Wizard of Ads® for Contractors, the lower the investment to get started. As they say, the best time to plant a tree was 20 years ago. The second best time is today.
Are production costs included in your fees?
The Wizard of Ads® for Contractors Creative Lead will create the ad copy, cast the voice actors, source the production house, direct the performance, pick the music bed, manage all the edits, and provide you with the completed ad for final approval before sending to air on your behalf. This is included in our fees.
You pay for the production house, actors, royalty-free music, and jingles directly to avoid any potential for markups, commissions, or management fees.
We have many friends in the industry that give our clients good deals due to the large volume of work we provide them. We will introduce you to them.
How long before a brand-forward strategy starts working?
In approximately three months of activation, we’ll just be getting live on air. In six months (3 months on air), you’ll be getting anecdotal feedback from people that you are being heard, but there will be no direct line to revenue.
After 6 months on the air, you’ll think you made the biggest mistake of your life signing up for this branding nonsense. After 9 months on the air (12 months in) you’ll see the light at the end of the tunnel.
At 12 full months on the air, you’ll know why you did this branding thing. Two years from now, we'll be clinking champagne flutes as you wonder why you didn’t do this sooner.
How long before we’re live?
The general guideline is 70-120 days, depending on the level of production needed and if there is a name change to your business.
This includes an onsite visit, a deep dive into research, and getting things created, negotiated, approved, produced, and live on the air.
- Uncovery - 15-30 days based on travel. 1-2 days onsite.
- Research - 30-60 days based on the scope of work.
- Creative and Media Buy Process - 45 to 60 days
- Offline Production - 15 days for radio. 30 - 60 days for television.
- Online Production (if switching) - 60 days
This means planning for roughly 90 to 120 days in the proper development and production of a completely unique Marketing Strategy before anything hits the airwaves.
Are you exclusive?
Creatively, yes. During the term of this Agreement, all Creative Partners assigned to your Account shall not engage, directly or indirectly, as an employee, officer, manager, partner, consultant, agent, owner, or in any other capacity, in any competition of the client, including any company engaged in marketing consulting.
For clarity, the Creative Partner is defined as the individual Wizard of Ads® Partners who is responsible for creating your creative strategy and ongoing creative copy. Competition is defined as companies that engage in the same industry and business units (e.g., HVAC, Plumbing, etc.) as you. The market area is defined as the area where the marketing message naturally reaches through DMA or 60 miles from the city center of the client's service area(s).
Naturally, we exclude any potential future competition in markets where you are not currently active at the date of signing.
We do not limit Media Buyers in any market. Media Buyers get better deals for larger volumes, making it beneficial for the client to have the Media Buyer available to do as many buys as possible to secure the best deals on the client’s behalf.
Do you do digital marketing?
In rare circumstances, Wizard of Ads® for Contractors will provide specific digital marketing solutions. Wizard of Ads® has very specific Partners that provide digital services that serve Residential Home Services effectively. Under no circumstances will digital marketing services be offered without Wizard of Ads® for Contractors' core solution.
It is most likely that Wizard of Ads® for Contractors will work with your existing digital partners and suppliers. If you do not have a reliable digital provider, we would be happy to introduce you to a number of great providers that play nice with Wizards.
Do you do jingles?
Wizard of Ads® for Contractors can assist you in getting a jingle for your business. Like any other tactical element of a marketing strategy, we do not produce a jingle for the sake of a jingle.
If you do not have a story or a strategic reason to have a jingle...or an ad campaign to tie it to, do not waste your hard-earned money on a jingle. You are wasting your time and money.
When you do build a single unified marketing strategy that incorporates a jingle for a specific (often scientific) reason, we have a Jingle Wizard who has studied the art and science of jingle design.
He will score you an original, royalty-free jingle, including professional singers, musicians, and producers. He will not knock off a generic jingle from a publicly available music bed that sounds like everyone else's jingle.
Your jingle will serve a very specific reason and produce a very specific result. Have you guessed how much we love jingles yet?
Who owns the copyrights?
Wizard of Ads® for Contractors owns your copyright for two very specific reasons. We also provide a fair use clause in all contracts to ensure you are in no way limited to the access of your creative works, whether you are working with us or not.
The first reason we own your copyright is to ensure that we do not have to go up against our own creative works in other markets we serve. This means you are not allowed to lend, give, borrow, tweak, rent, lease, or sell your creative works to any other company at any time.
The second reason we own your copyright is that we can establish a one-time value for your creative works in the event that someone steals the content. Upon selling you the copyrights, you can go after the perpetrator for theft and make a considerable bounty in a slam dunk case.
Here is how Wizard of Ads® word the fair use of your copyright for as long as your business is in operation:
All writing and/or marketing materials we create for you are not works-for-hire. Wizard of Ads® for Contractors hereby irrevocably grants you, and your successors in interest, the non-exclusive, royalty-free, non-transferable, and worldwide right to use the Works in connection with the marketing of your business pursuant to the Marketing Strategy for so long as your business is operational.
How do I measure brand results?
There are a number of interesting ways to measure results. Some people like to get unique identifying telephone numbers, or create branded URLs that redirect to landing pages or the website. However, much of this is a waste of time and energy as it never tells the true story of the brand journey and how it affected the decision-making process.
Other indicators of brand effectiveness include tracking new customers, reactivated customers, or running a brand equity survey to get a sense of your share of mind. Digitally you will see direct search increase, which cannot be affected by anything digital, as well as branded keyword inquiries increase. You’ll, of course, need to get your digital people to add these to your campaigns if you hope to see an increase in conversions.
Wizard of Ads® for Contractors tracks the simplest of indicators. Top line revenue. When your branding takes effect, and the company responds in kind from the phone call or form fill-on, top-line revenue will increase. Efficacy is plotted on a T12, and total lead volume from all sources is tracked.
12 things you should know before signing up.
- Quality relationships take time. Branding is a long-term strategy. That’s why most contractors do it wrong, or not at all. There is always a lag between the start of the new campaign and the time it takes your customers to connect the dots. You MUST BE READY, WILLING, AND ABLE to endure this lag period. In our experience, the lag is typically 6 to 9 months, depending on how competitive the marketplace is, your company’s reputation, your budget in relation to reach, and the eight uncontrollable environmental factors. During this time, we will be helping you implement a transition plan to ease the pain. The good news is that this lag only happens once.
- Decisions by Committee. We completely reject the notion of decisions by committee. We work with a single, courageous decision-maker. We welcome decision influencers, but we only look to the Owner for the final decision. All decision-makers and influencers must be involved in the Uncovery and Marketing Strategy Presentation if they want to offer input in the future. It is critical that we have a 100% fully approved plan that can be defended and championed by all leaders in the organization.
- Proven Strategy. That means we are not the low-cost provider. With nearly 200 home service clients and a book of strategic devices, tools, and tactics, this isn’t a guessing game for us. We know what to do to make your externally triggered grudge purchase appealing to your potential buyers. If you can deliver the goods, we can continue building relationships. If you are uncomfortable with the idea that you are paying us less now so that you can pay us considerably more once revenues allow, please do not commit. We intend to be your true partners, in sickness and in health...so long as you own your business.
- Automatic Payments. Everything is on automatic payments. If you struggle with managing cash flow, figure that out in your business first. We accept all major credit cards and ACH payments.
- We Cause Problems. If you don’t have a capacity issue now, I promise you will in about 9 months. Let’s deal with recruitment out of the gate as part of your comprehensive marketing strategy.
- We Own the Copyrights. All writing and/or marketing materials we create for you are not works-for-hire. We irrevocably grant you, and your successors in interest, the non-exclusive, royalty-free, non-transferable, and worldwide right to use the Works in connection with the marketing of your business pursuant to the Marketing Strategy for so long as your business is operational.
- Brand Building. We will be steering you to limit the use of discounts, rebates, coupons, and sales to attract clients. We know this feels counterintuitive to many, and we will clarify our reasoning. Rest assured, we have considerable experience in creating similar offers that are not damaging to your profitability, your brand’s integrity, and your preferable long-term client relations.
- Creative Authority. We must have creative authority over the words. You can accept copy as written or reject it outright, but you cannot modify the words yourself. If you do not like something as written, we are happy to discuss it and make the necessary change to maintain the integrity and intention of the words chosen. Alternatively, we will scrap the concept and create new copy that you are happy to get behind 100%.
- Proprietary Algorithm. The media buy must be structured in a very specific way, including running a full 52-week schedule. It is based on brain chemistry, not P&Ls. Once we have committed to the buy, it’s important to avoid adjustments unless they are calculated additions.
- Knucklehead Factor. You should expect knuckleheads. For example, when you start running ads that are certain to get attention, you need the courage to continue running those ads, even when you receive complaints. We celebrate complaints. It means we’ve made people feel.
- Digital Weasels. In about three months from the time your advertising campaign hits the airways, your digital marketers will show you a marked increase in direct and organic traffic. Some Digital Marketers will mistakenly claim this success as their own. Done properly, you can continue to spend less and less on digital lead generation by increasing your branded keyword online presence.
- Annual Marketing Meetings. Travel permitting, we prefer to hold Annual Marketing Meetings (AMMs) outside your city. Years of experience have taught us that we get better results when decision-makers are outside their sphere of influence, away from the day-to-day distractions of the office.
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