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Advertising

SPECIAL FEATURE
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
by Lauretta Converse

Exclusive: State of the Industry Advertising Survey

Some futon retailers love to hate advertising. Though they look at it as unnecessary, they spend a sizable part of their sales to purchase it. They have called it “a necessary evil,” “a nice expense to cut,” “a constant hassle,” and have complained that it “costs too much.” Yet they continue to advertise, shooting their arrows toward a nebulous target.

At the same time, other futon retailers are enthusiastic about advertising, saying, “It works!” “It’s good!”, “Worth every penny!” and “Without it you make nothing.” Rather than a shot in the dark, these futon furniture dealers are shooting their well-timed and well-aimed advertising arrows at a specific target, and scoring high points for their businesses.

In this article, we will discuss the results of Futon Life’s most recent survey of advertising practices among futon store owners. Here are the particulars about how some futon furniture dealers are moving their stores toward greater visibility and sales through advertising, how they are meeting the particular challenges of advertising in this futon industry and how their unique markets have required some unique solutions.

Beyond the Yellow Pages

Of the stores surveyed, 72% are currently involved in promoting their futon stores through advertising. The most popular marketing choice of retailers is to advertise in the Yellow Pages. This avenue was chosen by 82% of the futon shop keepers we spoke to.

Despite its popularity, Yellow Pages advertising presents some special challenges for futon furniture and other specialty bedding dealers. For example, Frank Stansbury of Fred’s Beds finds that his merchandise must be included in more than one Yellow Pages category. He says he needs to include his stores under four separate headings: Futons, Waterbeds, Mattresses, and Furniture. Consequently, he calls his cost for yellow pages advertising “heavy”.

Most retailers view their Yellow Pages advertising as merely a starting point for promoting their futon shops and products. Many choose other forms of print advertising as well. Print advertising, such as daily and weekly newspapers, magazines, and direct mail are more popular for our industry than broadcast media such as television and radio. In fact, print advertising is the most popular choice of 74% of shop keepers. Among the different print media options, daily newspapers are the most frequently used choice. Futon shops use this medium to increase their store’s name recognition through frequent ad placements. “Keeping your name out there” defines the approach that many newspaper advertisers use.

A smaller percentage of retailers choose to advertise through broadcast media such as radio and television. In fact, we found that only a little over half of them choose radio and TV. In addition, we found that futon shops who choose television, cable TV and radio advertising tend to have smaller advertising budgets than those who advertise mainly through print media. Broadcast media are often the vehicles of choice for advertisers who seek to promote specific sales.

The Futon Life advertising survey found that the location of a store is a large factor in determining a store’s choices for advertising. Stores in metropolitan areas were much less likely to attempt any advertising, and we found that 60% of metropolitan futon stores are not currently advertising. The combination of a highly visible storefront and the offering of a low-end product line seem to have convinced these futon shops that they have no need for additional advertising.

Advertising arrows that hit the futon spot

With millions of dollars being aimed at advertising from futon retailers, how can we know if the arrows are hitting their mark? Simply put, are their advertising dollars persuading buyers to come in to the store and buy futon furniture? Our survey results outlined the factors that are critical to successful advertising in the futon market.

Successful futon retailers have found that in order for their advertising to hit its mark, they must have their target in clear focus. They must identify and target certain customers. For Frank Stansbury, that means being mindful of the demographics of his market, which includes employees of a research park and a highly educated customer base. In response, Fred’s Beds has sponsored a home show seminar on the topic of sleep deprivation. His hope is that this type of marketing aimed at his customers will be particularly persuasive and will result in higher sales.

In a similar way, Nafeth Abusakout of Yasmeen Furniture has found a target market at which to take aim. Through purchasing advertising time on ethnic radio stations in his area, Abusakout is able to specifically reach Haitian and Spanish speaking people. He is very pleased with the result of his approach, saying, in fact, that futon shoppers “only come when you advertise.”

Mattress Depot has unique market concerns and has also learned to tailor advertising with specific customers in mind. Edgar Midgett says, “it helps me every time people move”, which happens quite frequently in his store near a North Carolina military base. But he found his sales dropped off twenty-five to thirty percent when the military PX began selling bedding. Competition has been stiff, but Midgett has sharpened the aim of his advertising. He hopes that by promoting his larger selection and personalized service, he can successfully compete with the lower prices offered by the PX.

Challenges of advertising

Many futon retailers sighted the difficulty in measuring results as one of the most frustrating aspects of advertising. Roy Moy of the Futon Company in Worcester, Massachusetts figures advertising to be “a hit or miss venture.” In our survey, other futon shops have called it “like a shot in the dark”, and a “gamble.” Unlike other aspects of their business, such as sales figures, and inventory and profit numbers, advertising fails to present futon shop with quantifiable results. And this is unsettling for many.

We spoke with futon shop owners about the importance of tracking the elusive results of their advertising and found that very few had formal ways of recording this information. Sometimes the method was as simple as a legal pad and pen along side of the store register. Other times, retailers have a specified place on their invoice to record how a futon shopper came to be in the store. Still others track their advertising through a computer code. The most popular method, to which retailers continue to give much credibility, is a “gut feeling” as to the effectiveness of advertising campaigns.

The delay of the benefits of an advertising campaign also adds frustration for the futon seller. For example, the benefit of an advertising plan that builds name recognition or product awareness tends to be cumulative and difficult to measure. Unlike promotion or sale ads, long-term advertising campaigns do not necessarily increase store traffic or sales immediately. The effects are measured over a period of time and many successful futon retailers must remain patient when measuring the success or failure of their advertising strategies.

Futon Life Advertising Survey Spring 2000

Do They Or Don’t They
Advertisers: 72%
Not advertisers: 28%

Budget method used:
Budget for the year: 56%
Budget as you go along: 44%

Percent of advertisers who
use the following media:
Print: 74%
Broadcast : 56%
Yellow Pages: 82%

Of those using print media,
percent which use the following:
Weekly newspaper: 60%
Daily newspaper: 48%
Magazine: 12%

Of those using broadcast media,
percent which use the following:
TV: 32%
Cable TV: 21%
Radio: 63%

Stores surveyed represent the following markets:
College town: 13%
Metropolitan: 34%
Suburban: 30%
Rural: 23%

Type of advertising primarily used:
Generic product ads: 31%
Promotion/sale ads: 38%
Combination of both types: 31%

Hitting a moving target

But advertising strategies are not as simple as identifying a store’s customer base and targeting ads to those buyers. In reality, many futon retailers find that their market is always changing, and therefore their advertising needs to hit a moving target. Peter Alasky of Alasky Furniture finds that it is a constant challenge to come up with new campaigns. Through years of advertising, Achenbach’s Furniture has discovered that “what works one time won’t work the next time, and what works one year won’t work the next.”

Frequently, it is the changing population of a market that moves the advertising target. One example is Fred’s Beds, where growth of this five-store chain has been tied to the local housing boom. Now that building is being restricted, however, the rate of new construction is slowing and sales are slumping as fewer new home buyers are furnishing fewer new homes. The challenge now for this store is to find new markets of potential growth.

The Futon Company has also found the changing market to be a challenge. This store began over ten years ago as a store focused on its young, college town customer base. But as the futon industry as a whole has grown beyond the bounds of the college market, so has Roy Moy’s store. He is now successfully expanding his store and his advertising to service his suburban customer base as well.

The Agency question:
To use or not to use?

As part of our survey, we asked futon retailers about their choices regarding the use of advertising agencies. We found some futon stores were dissatisfied with the services offered by agencies. David Miley of Futon Source found that the agency he hired had a poor understanding of his product and therefore was unable to plan and execute a successful advertising campaign for his store. Peter Alasky was also unhappy with the work done for his store by an advertising agency and is now producing his own ads in-house. He found that, after thirty years in the furniture business, he knows his market and his customers better than any agency could. And his enduring and growing business are proof of that.

Gene Sawdon has been making advertising decisions for Futon Gallery for nine years and has a different perspective on the ability of advertising agencies to benefit his futon store. He is currently using an agency and finds that it is most effective in negotiating contracts with television, cable TV and radio. Not only can he get a lower price for advertising in these media, but they also produce the commercials for him.

Hitting the bull’s-eye

Despite the challenges and frustrations that advertising in the futon and furniture markets present, retailers are experiencing a high degree of success and satisfaction in their attempts. Advertising arrows with the biggest impact seem to come from retailers who are willing to experiment with new media in addition to the traditional yellow pages, astute as to their target market, and patient with the delayed impact of their advertising dollars.

With many media choices and countless options for each advertising dollar, retailers need a strategy in order to make their advertising investment create the largest possible impact. Many futon store owners told us how easy it is to overspend on advertising, but the retailer who determines a strategy for his store that is appropriate for his market and patiently keeps an eye on the target can hit the bull’s-eye.

Lauretta Converse is a freelance writer here in Providence, RI. This is her second in a series of articles for Futon Life focusing on business trends and pricing issues in our industry.

FL

Spring 2000
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