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Permalink Reply by nick placakis on November 3, 2011 at 3:20pm

Sid,

 

One thing I would factor in to the advertising budget is either free coupons or %off purchase coupons to get people in to try your product and see why they want to become regulars. Either hand them out to existing customers to get their friends in to try or just hand them out around town, leave them with local schools so teachers and kids could come see what your about. You need to make it a sweet enough offer that they will go out of their way to come check you out. This will pay back dividens.

We do it at our shop and it works great. We also use it for them to check out our website for online purchases. We are in a resort area so people go back home after vacations and purchase from us online throughout the year. It also works during the season to get them in to our shop during down times like mid afternoons.

 

Try it out, I think you will find it works well. Just make sure you have systems in place to track the sale. For example, use a coupon cods that can be added to your pos, or even just collect the coupon from the customer when they present it for redemption. This is when we use it to gather e-mail addresses from customers who allow us to reach out to them via our e-mail list.

 

Good luck.

 

Nick

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Permalink Reply by Jay Caragay on November 3, 2011 at 4:29pm

$1200 on signage?  For what exactly?  How does your current sign fail? And what are you getting for that money?

 

Regardless of what the account execs will tell you (and I deal with a couple), there is no real way of quantifying advertising expenditures with generated revenue.  It's all a crap shoot - and I've spent several thousands of dollars doing planned campaigns over a period of time.  It's all still a crap shoot.  Sometimes it wins.  Most of the time, it doesn't.

 

Companies like Coca-Cola and Budweiser spend millions on advertising but they can't tell you either that those millions are really translating into capturing that extra percentage point of the consuming public.  Millions to fight over one percent of the market.  I don't think you have those kinds of capital resources.

 

Your best bet is to serve your market.  Truth be told, your coffee place is only bringing in clientele from a very small radius (larger in suburbs, smaller in urban areas). Focus your efforts there.  And what do I mean by focus?  Deliver great product and a great experience to your customers.  Make them feel welcome and enthusiastic about your place.  Let them spread the word for you - it will be more powerful than any amount of advertising you could spend money on.

 

Free coupons?  % off coupons?  Frequent buyer cards?  Forget them all.  You don't need them.  Actually, let me rephrase that: you don't need them if you're offering great product and a great experience.  Selling mediocre coffee and the average 3W experience?  Then you probably need those things to entice people and get them to come.

 

This is, of course, presuming that you have a good location.

 

At Spro, we don't give our product away.  We charge full-tilt because we're offering our guests what we hope is great products and a great experience.  An experience that hopefully leaves our guests enthusiastic to come back.  That's all the advertising you need.

 

From time to time, we might put an ad in the local weekly alternative paper or in the community newsletter, but those are not designed to capture new market share - it's unlikely that it would achieve that anyway.  We do those with extra funding we might have to support the community or to add a little boost to an article or award being mentioned in that issue.  But we can't afford to do a constant campaign - I've got baristas that need to be paid and be fed!

 

Does our approach work?  We think it does.  It's a slower approach that builds on your reputation, which I think is a stronger message than a radio spot or print ad.  People talk about us amongst their friends, recommend us and we do our best to deliver.

 

For three years (2008, 2010, 2011), Spro won the best coffee (or some variant) in Baltimore's City Paper.  It's a reader poll based award that we do absolutely no campaigning whatsoever for.  Our nomination and winning is based exclusively on the word of mouth and enthusiasm of our guests.

 

Deliver great product and an amazing experience and let your word of mouth grow.  That's the best advertising you can achieve.

 

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Permalink Reply by nick placakis on November 3, 2011 at 5:09pm

While I agree with much of what Jay has outlined and beleive wholeheartedly that superior product, world class service and a great experience will deliver great results over time, when a business is in the infancy stage you need to get people in the door quickly. Unless of course you have endless reserves of working capitol. In which case all you need to do is follow the above mentioned points and time will make you a success. If not then I suggest you actively find ways to get new potential customers in to check you out now rather than later after you have built a solid reputation. Remeber, theres a reason why all the franchises do grand openings, offer steep coupons and teasers to get people in and buzzing. More times than not it works. Just my opinion. keep us updated on how its going.

 

All the best!!

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Permalink Reply by Sid Gauby on November 4, 2011 at 7:20am

Thanks for all your quick replies it is much appreciated and helpful. The sign issue really is one of visibility. Our logo doesn't show up as well as we had hoped from a distance so those driving past don't know that we are a coffee shop even though we have added additional sail flags along the side of the road as well as a banner in front. I'm not convinced that making the sign darker and easier to read is the ultimate answer but at the same time if it drives 2 more transactions a day it pays for itself in a years time.  So we weigh that against other options.

We have done the fliers in schools and handed out some coupons in the imidiate area and have seen limited response from those efforts. Does anyone have experience in canvasing a neighborhood with coupons / menus in peoples doors? I personally don't like it but some of the "experts" say you will get around a 3% return on that which isn't bad because the cost is rather low in just ink and time.

Our product is good and we have developed a very loyal customer base getting started we just need more of them. I'm also playing around with the idea of a customer referral program where we give our most loyal customers coupons to share with their name on it and when so many of them come back they get a free drink, mug, shirt, etc.

 

Any other suggestions will be greatly appreciated and I'll try to keep coming back to fill in details as we go.

Thanks again

Sid

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Permalink Reply by Dennis McQuoid on December 18, 2011 at 6:10pm

Make sure the local papers and mags know who you are. Let them know you are doing something different. Usually, they are happy to write up a new business. They have to write about something. It may as well be about you.

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Permalink Reply by olivier dutil on December 19, 2011 at 5:32am

I agree Advertising don t really work for us small coffee shop. For us we do us the coffee card but it just a way to give a discount to the local since we are in a tourist town and it easy to charge a bit more since every  other coffee shop are overprice. i say keep that 1200$ and fine tune you product with it , keep it for staff party!!! really if you staff love working for you it will bring a awesome atmosphere that keep the customer coming back. i realize that every penny spend in a staff party will comeback be 3 . You staff will be happy and it make all the difference.

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Permalink Reply by Sid Gauby on December 20, 2011 at 1:24pm

Just a follow up on where we are now after another 6 weeks. We had a very nice write up done by one of the papers in town that led to some more traffic. I've also done a couple of internet media spots for folks interviewing business people and that too has generated some traffic. 

The best immediate return we have had on publicity was a gift card special that we posted on Facebook and blasted to our text followers and that was a $10 gift card for $5. It sold more than the livingsocial deal and we still got half the money rather than a quarter of it.

The hardest part of advertising for a new coffee shop for me is how much work it takes to get each customer and then how hard you have to work to keep them. There is just no easy way and dangers at every turn.

I'm having a blast!

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Permalink Reply by Corvus Coffee on December 20, 2011 at 1:35pm

I would have to agree with Nick. If you're running an artisan oriented business, getting people in the door is key. We do a weekly free coffee giveaway on facebook (which you are all welcome to participate in...) which has helped us gather a base of fans there. We advertise this via facebook ads (these are tricky, try a couple), which has had good results so far. 

We are starting Free Coffee Mondays at our new shop, which is by a college. In order to get free coffee (this is what we're saying but will not be rigidly enforced) you need a "Free Coffee Monday Card'. This is simply another business card I had printed up with a "free coffee" tag on the back. This is what we are spreading throughout the neighborhood and nearby college. This will get people in the door and hopefully last longer than if they just picked up the business card. 

Just make sure to message it correctly. Lower end businesses give away a lot of crap, so you have to differentiate yourself as much as possible from this sort of thing. For instance, we never do "sale" items. This implies (to me) something has gone out of date or isn't as good as it once was (see Oakley, their glasses are never discounted). We give away things but limit access to create a feeling of inclusiveness vs give away things with the appearance that we're trying to get rid of something. What I'm saying is I have NEVER been a fan of 'day old pastries'. 

Hope this makes sense and/or helps! 

Best,

Phil

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Permalink Reply by Jeff Hoeppner on December 21, 2011 at 12:43pm

Social media is your best friend. Establish a strong Facebook presence, and add on Twitter and foursquare as well. These are all free. Get a program like hootsuite to be your dashboard and you don't need to have a bunch of pages loaded on your computer. We are in a town of 11,000 people. We have Tim Hortons and McCafe to deal with. In our community, we have to fight hard for our customers. They come here because our focus is loving people any way we can. Second, is our coffee. In our tiny town we have over 1500 facebook followers, which means a lot. I like Facebook because of the level of interaction you can have with the customer. Twitter is nice for strictly a feed purpose. We just started a promotion with Foursquare where the "mayor" of Jonny's Java every month wins a gift card, and anyone that leaves a review will have their names entered in a draw. We are also working with a local grocery store as kind of a cross promotion. We have them a fat stack of "Treat a friend" cards. Their staff hands these cards out to customers that are shopping and the card gets them a free drink of equal or lesser value when they bring a friend into Jonny's with them.

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