Can we learn from businesses which don’t need to advertise?

inside a ostco (image from Wikipedia)
Inside a Costco (Wikipedia image)

I’ll dare to speak some sacrilege here.  Some truly successful and large businesses don’t need nor want to advertise, ever, at least in the conventional manner.  I think readers here will agree, for example, that you won’t get far trying to plug your publication or television station ad spots to Costco — which takes things a step further, and actually requires its customers to pay a fee to shop at the store.

Of course, Costco is one of those businesses which has fun playing with marketing conventions.  It is a no-frills warehouse store which sells most of its stuff to successful people — business owners and others who don’t mind the no-frills shopping environment to save some money and still enjoy the experience.  Rather than pour money into advertising, the company gets its vendors to contribute samples and to purchase advertising in its own in-house magazine.

Alright.  We aren’t going to sell many ads to Costco.

Lets look at the other end of the spectrum and a guy named Gord.  He’s the person who co-ordinated the trades for our recent kitchen renovation project.  He doesn’t advertise, belong to relevant associations, or promote his business in any way, but he never lacks for work.  He also probably prices his services well below what he could if he took a different approach, but he also appreciates the pragmatic built-in-efficiency and productivity of really small businesses.

(One consultant showed how the optimal size, at least in terms of employee productivity, for a construction/renovation business is three.  The reason:  The owner obviously is doing hands-on work, but with incredible skill and talent, and the team of supporters he assembles is large enough to help where extra hands are requried and, even better, to do the key jobs the owner-manager is really not cannot do best.  Once you get above three employees, productivity tends to decline; it is harder to find really good people and you have to build in the human resources cost/management/overhead of the larger work force.  The productity stabilizes once you get to 10 to 12 employees, when you then are able to build business systems and management approaches suited to larger organizations.)

Gord is clearly not going to get the to Costco’s level — and you’ll waste your time trying to sell him advertising as well.

So who is left?  Well, of course the market depends on your media.  If you are a local or regional or specialized audience media, your market will generally be businesses with enough money and growth ambitions to promote themselves effectively yet ones which haven’t figured out how to grow without marketing and advertising (fortunately the latter number is a small group.)

You’ll want to be very careful in selling advertising to very small and start-up businesses; they may be dumb enough to believe every word you say (and many words you don’t say but they want to believe), only to be disappointed with the results.