Advertising and Promotion Strategies
Advertising and promotional strategies can be an extremely important part of a business plan, especially for new businesses or those that are currently in their startup phase . This is because the products and or services being offered by startup companies are often not yet known to the market or if they already are, they are still considered as alternatives over the more mainstream products and or services being offered by more established industry players. Poor advertising strategies can be a reason for lackluster sales in the early stages of opening up the business. Being in the startup phase should not be a reason for businesses to have lackluster sales because soaring sales figures can be well achievable for startups, especially for those that have catchy and market-relevant advertising strategies.
For the Studio 6 Bistro business venture, the following are the proposed advertising and or promotional strategies.
- Digital Signage
Digital signage is poised to become the next big thing in the advertising industry. It can be easy to create contents that will be used for digital signage purposes as long as there is indeed something to be advertised about. One of the advantages of using digital signage as an advertising strategy is that it involves lower fees compared to traditional advertising practices. It is also a more efficient form of advertising because physical interaction between the advertisers and the target market is often not required unlike in traditional door to door advertising and mailing practices. Lastly and most importantly, the use of digital signage would enable the advertising team to reach out to larger audiences, for significantly less money at that. Currently, the biggest supermarkets, restaurants, and malls in the U.S. use this advertising strategy and according to reports, using digital signage has proven to be a very fruitful advertising venture.
- Social Network Advertising
Creating accounts in the most commonly used social media platforms such as Facebook, Twitter, and Tumbler, among others, is one of the most commonly used advertising and or promotional strategies today. This strategy can be beneficial for startup businesses in a lot of ways. Firstly, with the millions, if not billions of people using social media platforms to interact and do business, there can be some solid change that a significant number of people will discover the business, its products as well as its services and decide to try those out. Social network advertising will basically enable the management team to reach out to different markets for significantly lower fees without having to exert a lot of effort and spending a lot of time. The Studio 6 Bistro advertising team can, for example, target the local market of business lunch eaters, birthday and special event celebrants, families, and even students initially, and target more sophisticated markets as the business grows and expands. Despite the linear form of advertising that social network advertising offers, the Studio 6 Bistro should still use their creativity and resourcefulness in creating ads for their customers to see.
- Online and Offline Mail Advertising
An advertising scheme wherein customers and prospective customers will subscribe to an online or offline, or both, mailing service offered by the company can also be a promising strategy that can lead to significant leads. This is an advertising scheme that large supermarkets and some known restaurants in the United States use to keep in touch with their customers and attract new ones. We see no reason why this advertising or promotion strategy will not work for the Studio 6 Bistro. The plan for the Studio 6 Bistro mail advertising scheme is to include all the hottest and current product and service offerings with their corresponding prices. Other promotional offers such as the happy hour—a time frame where all foods and drinks are offered at discounted rates may also be included in the newsletters. This way, customers and prospective customers can know the latest offerings in the company.
Budget and Finance
Budget and Finance are two things essential for new businesses to start and operate. Without a comprehensive budget and an initial source of financial resources apart from the sales and revenues from the business operations—because it is expected that sales and revenue figures for startups would be lackluster until God knows when depending on the attractiveness of the products and services and the aggressiveness of the marketing and advertising strategies, it would be impossible for businesses to operate. There are three financing options that the Studio 6 Bistro management team is looking into: attract an angel or independent investor; issue corporate bonds; apply for a loan from a bank.
- Independent Investor
- Issuing Corporate Bonds
Corporate bonds are debt instruments that any documented and qualified startup companies may offer. It is different from a bank loan because in corporate bonds, the one that issues the debt is the business itself and the ones that finance the debt are independent and or retail investors. Just like bank loans corporate bonds have a tenor usually measured in a certain number of years, or the bond maturity date. The issuer of the bond often has to pay the investors’ principal investment by the time the bond matures. Aside from paying for the principal investment, the issuer also has to pay the annual bond coupon rate to the investors. Failure to pay either of these two would lead to a default.
- Bank Loans
Borrowing money from the bank is one of the oldest ways of raising capital. Just like issuing corporate bonds, the Studio 6 Bistro management team will have to present a comprehensive business plan to the person in charge of reviewing their loan application. The borrower often has the power or option to choose the loan tenor. The interest rate on the other hand is often dependent on the credit-worthiness of the borrower, which in this case is not yet established because the Studio 6 Bistro is a startup business. Therefore, the Studio 6 Bistro management team can expect the loan interest rates in case they choose the bank financing option to be slightly higher than the current prevailing rates.
The following is a sample computation of a bank loan that Studio 6 Bistro may use for their budgeting and financing with an amortization table.
Loan Payment Table
Littlejohn, S. "Advertising Theories." Encyclopedia of Communication Theory (2009): 19.