by Ron Manera, Editor

Why does SONY or Office Depot or Best Buy spend millions putting their name on the side of stock cars? Why does Goodyear float that big blimp over football games and golf tournaments?

Have you ever once had the urge to run over to Office Depot after the race and pick up some office supplies? Or stop by Goodyear after a football game and grab some tires? If not, what’s the point? Aren’t these companies wasting their money?

Even more confusing, the race car says absolutely nothing about Office Depot. It doesn’t say "we have great products." It doesn’t say, "we have low prices." It doesn’t say, "we have convenient location." Most likely there is nothing in or about that race car that has anything to do with Office Depot.

And there are no tires on the blimp!

What do these giant companies know about advertising that you don’t? It’s the power of name recognition - a key element in branding.

One theory of branding dictates that a prospect’s buying decision is greatly helped along by multiple positive exposures to a company name – sometimes hundreds or thousands of them.

You go to a major league baseball game and see a SONY sign on the wall. You don’t think much about it, in fact you probably would never remember seeing it, but when you go to buy a TV months later, that brand has been reinforced in your mind and it becomes a powerful motivator when looking at two TVs – and one is a SONY.

That’s why big companies spend millions on name recognition ads that are never going to close a sale – but certainly do help grease them.

Advertisers with smaller budgets tend to want ads that are going to generate immediate sales.

This is understandable. We just spent some hard-earned money on an ad and we want that phone to ring! "Call to action" ads, they are often called - since they are to incite a prospect to buy something NOW!

We want that instant gratification - it’s how we evaluate our advertising - but it’s often a mistake. We fail to take into account two big factors: First, the prospect may not be in the market "now." Second, we forget the longer-term benefit of name-recognition branding.

Take an insurance agency, for example. They run an ad package that costs $2,000. At the end of the 30 day "call now" campaign, they can only identify $1,200 worth of commission that came directly from the ad - nowhere near the break-even point. Was the ad campaign a mistake?

They need further analysis. First, only 1 of 12 readers/listeners, statistically, had a renewal coming up in the month of the campaign. (assuming all 12 month policies) Did that mean the ad was wasted on the other 92% of the prospects? Of course not. It could be assumed that a certain percent of prospects will continue to respond to the campaign, having noted it while it was running.

But the big benefit of the campaign may never be understood by the advertiser or attributable to the campaign: name recognition. Many of the prospects that may have been exposed to the ad campaign had the name of that business plugged into their mental database.

Five months down the road, one of those prospects does a Google search for a local insurance agency. None of them sound familiar - except one, because he’s heard the ad - and that’s the one he calls and that’s the one that earns the business. When the insurance agency asks, "How did you hear about our agency," the newly insured says, "I found you on the Internet."

And the process may be repeated over and over again, contributing business for years depending on the branding effectiveness of the campaign itself. The trouble with most "call to action" ads, is the name recognition factor often gets lost in the reams of data pressed on the prospect in order to get them to do something "now."

The advertiser is confronted with a choice: Short term vs long term results. Looking at the modeling of Fortune 500 company ads, it’s apparent they believe in both. You will find your classic "call to action ads," i.e., coupons ads and sales, but also a strong reliance on name recognition branding ads for long term results.

Recommendations:

Never underestimate the importance of name recognition brand building. It will yield long-term, annuity-like rewards in the form of new business. It may not be immediate - but it is powerful and reliable.

If you are a vendor or insurance company selling to insurance agencies, your ad may never close a deal or cause the phone to ring today. Yet when your marketing rep stops in an office and hands a business card to your prospect, or your prospect experiences some event with a competitor that causes them to seek a new provider, your advertising will pay off big.

As a result of your branding ads, the prospect will be familiar with your company in a positive way. You will have built credibility; a comfort level that an unknown or lesser known company just can’t own.

Always remember that more purchases and buying decisions are made for emotional or sub-conscious reasons than are done for intellectual reasons. People make buying decisions that are comfortable, easy and emotionally rewarding. Absent other factors, people will almost always choose to do business with a well known company over an unknown — regardless of the relative merits of the unknown company or product.

How would you like to be a TV salesman trying to sell a new Zap-o-Matic TV against a SONY? Even if the Zap-O-Matic is technically superior and carries a lower price? Consumers want a well-known brand. They want the comfort level of dealing with a leader. You become a brand leader by exposing the marketplace to your name and logo over and over again.

Don’t be so fast to declare an ad campaign unsuccessful simply because it didn’t pay-off big during the campaign run. If you made a powerful brand statement, it may be like money in the bank.

When you design your advertising remember: there my be nothing so important in the ad as your company name and logo - the visible or audible symbol of your brand.

Always advertise consistently and from multiple angles. The more places and times your brand appears, the stronger your brand identity will be in the marketplace.

Advertising experts tell us that an advertising message must make 5-8 "impacts" on a consumer before it is noticed or effective. That’s why single-run campaigns are often unsuccessful. Subsequent ads build on past ads. Each campaign becomes more powerful and more effective as ad saturation increases.

I proved this to myself years ago with a direct mail campaign to insurance agents in the Carolinas. Although thousands of mail pieces went out on the first mailing, there were a small percentage of responses. The second mailing was slightly better. Many advertisers would have called it quits at this point, since the campaign had generated an unsatisfactory return.