The Wall Street Journal
Small Companies Ride Coattails of Larger Firms to Reduce Advertising Expenses
Mountain News Corp., which tracks snow conditions for ski mountains through its website, got a burst of national exposure without spending a penny last winter when Apple Inc. chose to feature Mountain News' mobile-phone app on an iPhone television commercial.
Before the commercial ran in February 2009, the Orinda, Calif., firm was pulling in 1.2 million unique visitors a month to its site, OnTheSnow.com. A year later, that number had jumped to 2.2 million, which the firm's global managing director, Chad Dyer, attributes in part to the free advertising. "There was nothing we had to do, nothing to spend," says Mr. Dyer.
Small companies generally keep tight tabs on advertising and marketing expenses, as the payoff may be uncertain. About 40% of business owners reported earlier this year that the economy was preventing them from spending on marketing and sales, according to a survey released by American Express OPEN, the company's small business division.
Sharing the Spotlight
While most small businesses aren't fortunate enough to be able to latch on to the campaign of a big company like Apple, some business owners have found ways to reduce marketing costs by sharing the spotlight with another company.
In May, Birds Barbershop in Austin, Texas, launched an advertising campaign with Lone Star Beer, which is owned by Pabst Brewing Co. The ads, which are running in local print and online publications, show a customer sporting a new hair-do and holding a beer. The ads list the price of the haircut and indicate that the beer is complimentary.
The barbershop has been serving a free beer to customers since 2006, says Michael Portman, who co-owns four locations. Lone Star had already been supplying the barbershops with cases at a discount price, and was game to split the cost of the ads.
The most expensive ad, prominently displayed in a bi-monthly Austin magazine, cost $900. Without a partner, Mr. Portman says he probably would have chosen a more modest ad. "I wouldn't make that leap alone," he says.
AssociaDirect Inc., which provides customized marketing tools to help organizations reach new members, is in the process of sending out more than 2,000 direct mailings to potential customers advertising a new marketing application for mobile phones. AssociaDirect's chief executive, Michael Faye, says the firm is splitting the $3,700 cost of the mailings with mobile technology company ConnectMedia Ventures, which will help create the application.
AssociaDirect is the only firm being advertised on the fliers, even though the two firms will collaborate for each project—AssociaDirect will create the design and ConnectMedia will provide the tech support. AssociaDirect will pay ConnectMedia for its portion of the work.
Before the commercial ran in February 2009, the Orinda, Calif., firm was pulling in 1.2 million unique visitors a month to its site, OnTheSnow.com. A year later, that number had jumped to 2.2 million, which the firm's global managing director, Chad Dyer, attributes in part to the free advertising. "There was nothing we had to do, nothing to spend," says Mr. Dyer.
Small companies generally keep tight tabs on advertising and marketing expenses, as the payoff may be uncertain. About 40% of business owners reported earlier this year that the economy was preventing them from spending on marketing and sales, according to a survey released by American Express OPEN, the company's small business division.
Sharing the Spotlight
While most small businesses aren't fortunate enough to be able to latch on to the campaign of a big company like Apple, some business owners have found ways to reduce marketing costs by sharing the spotlight with another company.
In May, Birds Barbershop in Austin, Texas, launched an advertising campaign with Lone Star Beer, which is owned by Pabst Brewing Co. The ads, which are running in local print and online publications, show a customer sporting a new hair-do and holding a beer. The ads list the price of the haircut and indicate that the beer is complimentary.
The barbershop has been serving a free beer to customers since 2006, says Michael Portman, who co-owns four locations. Lone Star had already been supplying the barbershops with cases at a discount price, and was game to split the cost of the ads.
The most expensive ad, prominently displayed in a bi-monthly Austin magazine, cost $900. Without a partner, Mr. Portman says he probably would have chosen a more modest ad. "I wouldn't make that leap alone," he says.
AssociaDirect Inc., which provides customized marketing tools to help organizations reach new members, is in the process of sending out more than 2,000 direct mailings to potential customers advertising a new marketing application for mobile phones. AssociaDirect's chief executive, Michael Faye, says the firm is splitting the $3,700 cost of the mailings with mobile technology company ConnectMedia Ventures, which will help create the application.
AssociaDirect is the only firm being advertised on the fliers, even though the two firms will collaborate for each project—AssociaDirect will create the design and ConnectMedia will provide the tech support. AssociaDirect will pay ConnectMedia for its portion of the work.
'Sales Arm to His Product'
"My partner understands that we are the sales arm to his product," explains Mr. Faye, who says he has since landed six appointments with interested organizations. "I don't have hundreds of thousands of dollars in my marketing budget."
FirstBank Holding Co. ran seven billboards throughout Colorado in the latter half of 2009 showing off its entrepreneurial customers. The billboards listed the services each entrepreneur provided—math tutoring, wedding singing and dog walking, among others—and included contact numbers. The bank's logo and a message about catering to small firms was at the bottom.
"My partner understands that we are the sales arm to his product," explains Mr. Faye, who says he has since landed six appointments with interested organizations. "I don't have hundreds of thousands of dollars in my marketing budget."
FirstBank Holding Co. ran seven billboards throughout Colorado in the latter half of 2009 showing off its entrepreneurial customers. The billboards listed the services each entrepreneur provided—math tutoring, wedding singing and dog walking, among others—and included contact numbers. The bank's logo and a message about catering to small firms was at the bottom.
'I Didn't Lose Anything'
But even free publicity may have no end result. Math tutor Travis Macy, who is also a high school teacher, says he didn't land any new customers despite getting a flurry of inquiries from the bank's billboards. "None of them were a suitable client because of time constraints or subject matter or price," Mr. Macy says. "But my investment was nothing…so I didn't lose anything."
Cost isn't the only consideration in a collaborative ad campaign, says Paul Weber, president of Entrepreneur Advertising Group LLC., in Kansas City, Mo., which specializes in small-business marketing. One risk is whether the brands can coexist and, if there are multiple partners, whether the brands dilute each other. For example, a mail campaign that contains a stack of individual coupons isn't as beneficial as a campaign that focuses on the businesses as a collective community.
"If you're sharing the cost of a rotating billboard, [audiences] can separate the two," he says. "But if you are putting them together and telling customers that if you like this, you'll like that, make sure to do your due diligence."
But even free publicity may have no end result. Math tutor Travis Macy, who is also a high school teacher, says he didn't land any new customers despite getting a flurry of inquiries from the bank's billboards. "None of them were a suitable client because of time constraints or subject matter or price," Mr. Macy says. "But my investment was nothing…so I didn't lose anything."
Cost isn't the only consideration in a collaborative ad campaign, says Paul Weber, president of Entrepreneur Advertising Group LLC., in Kansas City, Mo., which specializes in small-business marketing. One risk is whether the brands can coexist and, if there are multiple partners, whether the brands dilute each other. For example, a mail campaign that contains a stack of individual coupons isn't as beneficial as a campaign that focuses on the businesses as a collective community.
"If you're sharing the cost of a rotating billboard, [audiences] can separate the two," he says. "But if you are putting them together and telling customers that if you like this, you'll like that, make sure to do your due diligence."
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