Let Me Explain…
… how Town & Country Gardens used co-op dollars and radio ads to increase a product’s sales by 300 percent.
For many years we had been using our co-op dollars from VPG (Fertilome) to advertise our four-step lawn program. When we switched to our own private label lawn program we couldn’t use the co-op for that purpose any longer, so we brainstormed ideas on how to best use the co-op dollars available from them.
We decided that we would try running a series of radio ads, each on a specific product at the height of demand for that product. We chose products that we felt had a story that needed to be told in order to achieve their sales potential. We settled on six Fertilome products that we thought could really benefit from having their story told. We did not discount our selling price on any of the products.
We felt that 60-second radio ads would be the best medium for us to tell the story. Because we are in a small market, radio is fairly inexpensive. For a 60-second spot we paid as little as $5 on smaller stations to around $30 for the top-rated stations. With the 66 percent co-op that VPG offers, that allowed us to run quite a few spots each week for the six weeks and still stay within budget.
Because I have been in business for 46 years and have done a weekly radio show for many years, I started out each ad with “Hi, this is John Crook, owner of Town & Country Gardens.” Then I went on just like I was talking to a friend. I talked about my own experience with the product and pointed out how people’s lives would be improved by using it. The ads were personal, conversational and believable.
We were overwhelmed when the first ad ran (Fertilome Over-the-Top Grass Killer). Within the first two days we had run out of our entire supply for the year. We ended up selling nearly ten times what we sold in previous years. And we would have sold much more had we not kept running out of stock. After this first experience, we gave our supplier a schedule of what we would be advertising and they allowed us to bring in plenty of extra product prior to the ad running, and return full cases that didn’t sell for credit when the promotion was over. This helped maximize sales and minimize our risk.
The amazing thing to me was the staying power of the ads. Although the ad on this first product only ran for five days, we continued to get people coming in asking for it for six weeks. However that wasn’t the case with all of the ads.
Two of the ads were home runs, increasing sales by at least 300 percent. Two of the ads had good results with increases in sales of at least 50 percent. Two of the ads saw only a slight increase in sales. I think the difference had more to do with the product than anything. If the product wasn’t unique enough and the story was not compelling enough, people didn’t respond.
Success the Second Time Around
Overall the ads worked so well we decided to try it in the fall on another product that had a story to tell. It is a locally produced organic plant food product that was already one of our best sellers, but we thought it had additional potential if we could promote it properly. The problem was the manufacturer was a small company and they had no co-op program.
We approached them with a proposal that if we spent $750 on advertising, they match it with another $750. They were reluctant at first, but when we told them of our previous results they agreed to match our funds.
We don’t have a lot of budget in the fall for advertising, but that gave us a total budget of $1,500, which allowed us to run the ad for a total of four days (two weekends) on several stations. The small investment paid off. Sales on the product resulted in an increase in margin dollars of over $4,000 in the eight weeks during and following the ad. Not bad for an investment of $750.
In the end, for all seven products our margin dollars increased from $21,187 in 2009 to $44,022 in 2010. That’s a total increase of nearly 23,000 margin dollars on a total advertising investment of under $4,000. In addition, the total category of fertilizers and chemicals had a significant sales increase in a year when sales were down in most other areas. I’m sure some of that increase can be attributed to these ads as well.
Videos
