The Better Hand: The Media or the Restaurant or Hotel

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Permalink Reply by Maria Bell on August 24, 2008 at 11:41am

Hi, before I exchange a trade, I make sure he gets my business cards with his name on the back of them so I make sure he distributes them. This way, we both win. I f next time he shows up I don't have enough cards with his name in my drawer, i won't do a trade.

Permalink Reply by David Mark on August 24, 2008 at 1:22pm

I'm glad I discovered this today. The reason is because I base 95% of my business (at this time) on trade. I perform effective, results-oriented marketing services exclusively for the restaurant industy and I certainly have an edge over traditional media (TV, radio, etc...) by offering trade services at a much lower cost and with measurable results. I can't and won't speak completely for those who offer interruption media (a.k.a. Adversting), but I certainly can and will for myself and services.

Trade works! That is if you go with a truly remarkable and measurable marketing campaign. How so? Digressing for a moment - Radio, TV, Newspaper and Direct Mail can be very expensive and part of your success depends on which of these mediums you utilize. Of course, the other variables to consider are your message, your offerings, menu, location, etc...

The other important consideration is how often you advertise. Save your money if you can't/won't GO BIG! It's been said many differnet ways there is much more money wasted on too little advertising than too much. Direct mailing for 2-3 months is a waste. Radio? If it's done "right", you're coming out of pocket big time and so on... For those in the aforementioned industries, please don't take it personal. I'm not attempting to bash your medium because I've been there. It's simply a fact and my friends within those industries agree. We would never take a clients hard-earned money if all they wanted was a meaningless, invisible campaign. I don't need the money that bad! For restauranteurs, build effective and ample advertisng into your budget, or put your money into better ingredients/menu until you can truly afford advertising. After all, the best advertising in the world might, MIGHT get me into your place once, but if it's not tasty - I'm gone (and probably won't be back)!

Also consider this: Many Radio and TV stations have abundant overhead and their margins are typically thin, especially for radio. Therefore, they prefer paying customers over trade any day. I realize they've been known to sell some of the gift cards (rec'd as Trade) at a discount to minimize their exposure, but that is alot of selling. You present great questions above. However, I wouldn't focus on who is getting the "better" deal. Who cares as long as you're getting what you want, right? Then again, if you have to ask the question.....you must already know!

Now, back to answering the 'How?'.
My Trade Agreements are in plain english (no complicated legal jargon) and I have performance benchmarks in favor of the client simply stated. I don't abuse the Trade by using them for myself and a date, or my mooch buddies. I want results for you! I want heavy traffic in your restaurant and I want them to tell their friends about you!

So, the next time you consider Trade (assuming you don't do this already), get a great Trade Agreement that doesn't require a legal mill to determine "fairness". Find a way to measure the traffic coming in from the respective radio or TV stations. I have a unique code on every card so the restaurant manager can see exactly the source. Also, know your margins on the Trade. For instance, consider the literal value if you gave 500/$50 gift cards as Trade. If your profit margins on avg. are 30%, then your campaign costs roughly 17.5K versus spending 25K on a non-trade agreement. Is that worth it to you? Ask what your exact campaign would cost if you paid cash versus Trade.

Consider the intangibles too. My clients tell me the customers who use my trade cards tend to spend more than expected, or simply spend over the card value. Why? The mentality is they just saved 50% on the card, so why not get the "better" wine, or shrimp cocktail this time? Remember the last time you leased a car and decided to get ALL of the extras because it seemed like a great deal? Same thing is going on here. You think you're "saving" money, but in the end you're out of pocket more than you planned. Also ask