Note: I originally posted this on strongcaster.com, but thought I would post it here as well, with a few modifications
Derek Sivers has a great story on his blog about a musician who booked an ad in a magazine in the hopes of converting 1% of the magazine’s readership into sales. In this case, 1% would have translated into 10,000 CDs sold. The result? 4 CDs sold.
He ends with this line: “He forgot there was a number lower than one percent.”
This story reminded me of when I owned my own retail shop. We would place a full-page ad in the newspaper (with a coupon), hoping sales would just poor in. The newspaper’s circulation was 20,000, so a 1% conversion would have meant 200 new customers. But sure enough, only a handful of new people would walk through the door.
Circulation means nothing without engagement. This is one of the reasons the newspaper industry is in such trouble; for years businesses would throw money at advertising and hope it would make a difference. The problem is that, often, it didn’t.
This isn’t to say that print doesn’t have a place; there are many factors to consider, including the size of one’s target market, ad design, etc… The difference is that online you can measure engagement:
My recommendation for businesses with yearly marketing budgets of $500-$5,000 is to spend the majority of that money building engagement online. When you compare it with print advertising, you will get a much better return on investment.