Seth Godin bemoans how cheap the ads are during non-prime-time spots. That is, they’re produced cheaply. They stink. On the other hand, an advertiser will pour millions of dollars into a Superbowl ad that runs only once. Because they don’t want to spend a lot of money producing an ad for a spot worth only a couple hundred bucks. But here’s why this logic is severely flawed, even if the ad runs only once in a cheap spot.

Never compare how much an ad costs to produce versus how much it costs to run.

Let’s say I spent $100,000 producing a radio ad that I ran for $10 a spot. Would that be a good deal? Our gut reaction is that it would be a waste of money, because we think that a $10 spot must be worthless, or else they’d be charging much more for it. But that’s not necessarily true. Remember that late-nite infomercial spots were dirt cheap when the Ginsu Guys first started running their ads. Were those spots worthless? Hardly!

So let’s say I spent $100,000 producing a radio ad that I ran for $10 a spot, in 100 spots—still a measly 1% of the production cost. And let’s say this ad brought me customers worth $1,000,000 in sales over the next 5 years. Would that be a good deal?

Never compare how much an ad costs to produce versus how much it costs to run. Rather, compare how much it costs to produce and run versus how much money it makes! The reason Superbowl-ad companies don’t do this is because they usually don’t know how much an ad is actually worth.

What does this have to do with your website?

Many small businesses adopt the flawed Superbowl-ad mentality with their websites, because that’s all they know. And when it costs $7.95 a month to host a website, they can’t justify spending thousands of dollars on professional web copy and traffic generation. Instead, they say, “We can only afford $7.95 a month for a web site.”

But what if that web site could generate $1,000 a month in sales? Aren’t you potentially wasting an opportunity?

That’s why there are 4 pillars to a successful web strategy (not just one): sales copy (to convert visitors to customers), web technology (to bring the sales copy to web visitors), traffic (so someone actually sees the website), and statistics (so you know how much your website is actually worth).

-TimK

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