Advertising budget versus income?

Discussion in 'Business Operations' started by Liendeni, Apr 23, 2008.

  1. Liendeni

    Liendeni LawnSite Member
    Posts: 218

    Just curious if any of you successful business owners out there have an "income to advertising" budget ratio? What I mean by that is....what percentage of "profit" do you spend on on advertising for the following season?

    The reason I ask this question is because I am new to the "Green" industry but seem to notice a common theme - you don't see anybody spending any type of "real" money on advertising in our area (Florida) I live in a fairly upscale neighborhood (due to wife's success and my other business) and we get flyers in our mailbox (pisses me off cuz its illegal), flyers in our yard (reminds me of trash) but that is about it.

    Everybody seems to be taking the cheap and most inexpensive way out.

    10,000 post card....delivered....seem to cost about $4,000 after postage.

    We get a very nice colored advertisement magazine each month that cost $475 a month to advertise in (we both look at it each month...thumb through it as home owners). Not a single lawn company in this mag.

    Am I missing something?

    Please advise?
     
  2. mowerbrad

    mowerbrad LawnSite Fanatic
    Posts: 6,273

    The best kind of advertisement is word of mouth, which is FREE!!! When you typically put out advertisement like post cards or newspaper adds you only get maybe 2% of the people who got your ad to call. And of those people not all will use your services because they may get a better price from some other company. So just spend a little money to get your name out there (ie newspaper ad) and then let word of mouth do a lot of your other advertising.
     
  3. Down2EarthLawns

    Down2EarthLawns LawnSite Member
    Posts: 191

    Well....some people are not looking to grow. Our projected advertising % for next season is 10%. This may seem a little high but I truly believe that you have consistantly get your name out there for stabile growth. The timing and method of advertising is essential to get the most out of money spent. $475 is pricey, but if the return worked out, I may give it another month. I like to switch it up in my area to give people as many different ways to see our name, rather than bet my budget on one in most cases.
     
  4. mngrassguy

    mngrassguy LawnSite Silver Member
    Posts: 2,167

    I think it all depends on the age of the business. New companies need to advertise and spend more to get their names out there. Once out there, word of mouth/quality of work go hand in hand. Well established LCO'S don't need to advertise because they already have all the work they need.
     

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