Advertising Is an Investment, Not an Expense

Advertising Is an Investment, Not an Expense

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Advertising is an Investment, Not an Expense

Contrary to the beliefs of many small business owners, advertising is an investment in your business, and not simply another business expense to be cut when times are tight.

In fact, among the most commonly cited reasons among small business owners for not spending money on advertising are that they simply cannot afford it.

This is actually the wrong way to look at advertising. While it can be easy to begin slashing expenses when a budget is tight, advertising should certainly not be the first thing to go.

A business expense, by its nature, is something that is consumed and used up, much like copy paper or even ink for the office printer.

When utilized successfully, advertising is not consumed. Instead, it continues to bear fruit in the form of a steady stream of new customers. Of all of the investments that your company can make, smart advertising decisions can provide a significant return on investment.

If your company is experiencing difficulty in determining the ROI for advertising, then it may be time to review your advertising strategy.

The Yields of an Effective Advertising Strategy

A solid advertising strategy should always communicate the right message to your target audience in a timely manner. When you are able to do that, your business will continue growing and your advertising will continue to provide a great return on investment.

Unfortunately, the approach that many companies tend to take is to view advertising as something to slash when money is tight. Even worse, advertising is also often one of the first things to take a cut even when business is good.

The thought process is that if business is so great, there is no need to market. This can be an extremely dangerous business practice to which even Fortune 500 companies can fall victim. Eventually, a new competitor will come along or market dynamics will shift and those companies that eschewed marketing because they saw it as an expense rather than an investment will find themselves wishing they had a source for new business. Investing in effective advertising can help to ensure that you never find yourself in that position.

Perceptions Count in ROI

When it comes to calculating the return on investment you receive from advertising, it is important to remember that in today’s technologically savvy world, the return on perception that your company receives from an investment in advertising is equally as important to branding.

When you are operating on a tight budget, it can be difficult to invest in advertising. The truth of the matter is that regardless of what stage you may be with your business at the moment, you cannot afford to ignore the need for advertising.

The key is to make sure that your investment in advertising counts and finding the advertising medium that works best for your company.

How do you view advertising in your business strategy?

Do you view it as an important investment or an expense to be cut whenever possible? Let us know what you think by leaving a comment below.

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