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What Do Customers Say About Aerial Advertising?

The aerial advertising companies think that airplane messages are incredibly worthwhile. Advertisers might be enchanted with the novelty of having their ad flown over a busy beach or festival.

But what do consumers think? It would seem a waste for advertisers to spend a good deal of money on advertising that won’t be worthwhile, that consumers won’t respond to, that won’t bring customers and money to the door.

Advertisers will be happy to know, then, that consumers think highly of aerial advertising. They enjoy watching the banner ads, and they remember the ads long after they are gone.

In 2004, a Miami Beach survey of 2,194 beachgoers backed this up. After seeing airplane messages in the sky, they were asked some questions about the advertising. The results were interesting and useful to potential aerial advertisers.

Other forms of advertising might be remembered for a short period of time, especially if the message is unique, but most consumers don’t recall the information for very long.

So what’s enlightening is that in the survey of beachgoers a stunning majority of people not only remembered the banner ads they saw, they remembered them for a long period of time.

Beachgoers were asked if they remembered the banner that passed over in the past 30 minutes. The response? 88% of them had. It’s hard to imagine another advertising medium that could boast of 88% of the people remembering it 30 minutes later.

In fact, most people pay little attention to advertising, unless the message is unique or the way of communicating the message is unique (as in a duck, cavemen, or something similar). But sometimes how you present that message is what’s unique (as in aerial advertising) and that’s what people pay attention to. Once you have that attention, you can get your message across in a clearer way than you might think.

The advantage of airplane advertising is that it is unique. It’s not like all the advertising that we see on any given day – billboards, radio ads, and newspaper and television ads. When that plane flies over, towing a banner and a message, we all look up. We pay attention. We remember.

And this statistic bears that out – 79% of the people questioned remembered what was being advertised on the airplane banner. This is 30 minutes after the banner passed over. This backs up what aerial advertising companies already know – airplane messages work. The medium is unique enough that people notice it and they remember it. An advertiser can ask for little more than that.

Finally, the best news for advertisers – 67% of those beachgoers surveyed said they remembered at least half of the message of the airplane advertising. When people remember the message, they remember the advertiser. They seek out the product or service being advertised.

The bottom line is, consumers respond to aerial advertising. They enjoy looking at it, they pay careful attention to it and (best of all) they remember it. Whether alone or combined with other forms of advertising, an advertiser’s dollar goes far when used for plane advertising.

Hiring An Auction Company

Estimating your assets value:

Typically, one of the first questions a business owner will ask me is, “how much will the assets bring at an auction”. After taking the time to review the assets, the auctioneer should give the client a conservative estimate of the sale based upon his experience and the current market trends. It is important that the company give realistic expectations so the seller can make informed decisions based on their best interest.

Compensation and Expenses:

Is the company you are considering working for you or against you? The agreement you decide may determine this.

A business owner should carefully consider how the auction company is compensated. The most common commission structures include: straight commission, outright purchase of assets, guaranteed base with a split above to both auctioneer and seller, guaranteed base with anything above going to auctioneer or a flat fee structure.

In a straight commission structure, the company is paid an agreed upon percentage of the total sale.

In an outright purchase agreement, the auctioneer simply becomes your end buyer. The company purchases your assets and relocates them. While this can be an option in some unique situations, keep in mind that they will want to purchase your assets at a very reduced price to make a profit at a later date.

In a minimum base guarantee, the auction company guarantees the seller that the auction will generate a minimum amount of sales. Anything above that amount either goes to the auction company or split with the seller. While a seller might feel more comfortable doing an auction knowing that he is guaranteed a minimum amount for his sale, keep in mind that it is the best interest of the auction company to secure a minimum base price as low as possible in order reduce their financial liability to the seller and secure higher compensation for the sale.

In a flat fee structure, the auctioneer agrees to show up for the sale and call the auction. There is no incentive for the auctioneer to get the best prices for your assets. The auction company is compensated regardless of the outcome of your sale.

What is the best option for business owners? In my experience, an agreed upon straight commission structure. This puts the responsibility on the auction company to offer the best outcome for everyone involved. There is an incentive for the auction company to work hard for both parties, set up and run a professional sale, get the highest bid and sell every item on the inventory. Successful auctions translate to a higher bottom line for both the seller and the auction company.

Auction Expenses:

In most auction agreements the expenses to conduct an auction are passed to the seller. If the auction company pays for the expenses, it is simply absorbed in higher commission rates.

All expenses should be agreed upon in advance in a written contract. Typical expenses will include the costs of advertising, labor, legal fees, travel, equipment rentals, security, postage and printing. A reputable auction company will be able to estimate all expenses based upon their experience in previous auctions. An agreement should be actual costs charged as expenses, not an estimated amount.

Advertising is typically the highest cost in conducting an auction. The auction company needs to set up an advertising campaign that will promote the sale to its best advantage and not overspend to simply advertise the auction company.

Once the auction is complete, the auction company should provide a complete breakdown of all expenses to the seller, including copies of receipts within the auction summary report.

Buyer’s Premium:

What is a buyer’s premium? If you attend auctions regularly, you are very familiar with this term. The auction company charges a fee to the buyer when they buy an item at auction.

The buyer’s premium has been around since the 1980′s and is standard auction practice. It was first used by auction houses to help offset costs of running brick and mortar permanent auction facilities. Since then, it has spread to all aspects of the auction industry. It is prominent in online auctions and allows auction companies to cover added expenses incurred from online sales.

It is the responsibility of the auction company to provide clear disclosure of the buyer’s premium to both the buyers and the sellers. Those not familiar with auctions are often taken back by the buyer’s premium. They looked upon it as an under handed way for the auction company to make more money. Reputable auction companies will provide full disclosure within the auction contract, advertisement and bidder registration.

Typically, an auction company will charge online buyers a higher buyer’s premium percentage than those attending an auction in person. Extra fees are incurred with online bidding and are charged accordingly to online buyers. This provides the seller a level playing field for both online buyers and those attending the auction in person. Without the buyer’s premium, there is no way to do this.

Pre-Sales:

We’ve all been there. We’re looking forward to attending an auction only to find that some items were sold prior to the auction date.

As an auctioneer with over thirty-six years of experience, I can honestly state that pre-sales will hurt an auction. When a company decides to liquidate their assets, it is easy to sell off high-end pieces of equipment through online sources, equipment vendors or to other businesses. The seller receives instant cash and avoids paying a commission to an auction company.

Auctioneer’s find themselves appearing to acting in a self-serving capacity when potential clients say they are planning to sell off parts of their inventory prior to an auction. It’s hard not to consider the auctioneer’s commission when they warn you not to pre-sell anything. Yes, the auctioneer wants to earn a commission on those sales but it is more important that the auctioneer protect the sale from potential negative backlash that comes from pre-selling. The buying public knows when an auction has been “cherry picked” prior to the sale and it reflects in their bidding. It becomes a sale of “leftovers” and that impacts prices.

A buyer who purchases prior to the auction usually does not attend the sale. They already bought equipment at a good price with no competition. If they do attend the auction, they tend to let others know of their great pre-sale purchases which again, impacts prices and the overall excitement of the sale.

It is important to understand that auctions work best with a complete inventory. You want competition on your higher end equipment. The easy to sell items make it possible to gain respectable prices for hard to sell items.

When a business owner decides to liquidate their equipment assets, there is only one opportunity to do it right. Hiring a reputable auction company will assist you with a professional, orderly and timely liquidation.

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Reality Vs Myths – SBA Changes Small Business Reporting Standards

The SBA recently made some changes to how small businesses can compete in the federal marketplace, leading to some false beliefs. An examination which clears up some of the false beliefs about the change in Small Business Association guidelines and how it affects businesses trying to do work with the government.Myth: Small Businesses can’t compete in the federal marketplace because large companies are getting contracts specifically written for smaller businesses.Reality: Though it is true this has happened in the past, large businesses taking contracts set aside for smaller businesses is not a real factor anymore in the federal contracting arena. A minuscule percentage of contracts get awarded to companies whose size is later challenged – the companies are almost universally on the edge of what is defined as a ‘small business’ rather than the large multi-national corporations. The Small Business Administration (SBA) has adopted regulations which keep such contracts from being considered as small business contracts, helping to make the available figures and statistics more accurately reflect reality.Myth: Large and multinational corporations are listed in the GSA’s database with small business contracts because they were awarded them.Reality: There are two explanations for this. The first is that size status is determined at the time a contract is awarded, and is retained for the duration of the contract. In recent times, agencies have increasingly been awarding long-term contracts which can extend for as much as twenty years. During that period it is quite possible that these businesses become larger and no longer fit the small business size standard for their commodities. Small businesses are becoming large businesses during the period of their contracts, making size reporting difficult to implement effectively. Secondly, many large companies have a strategy of purchasing small businesses with long-term contracts, meaning that a contract awarded to a small business may then become owned as a subsidiary of a large business. Until recently, agencies were allowed to count those contracts toward their small business goals despite this fact.Myth: Nothing has been done to stop such misrepresentation of small business awards, and the SBA has not made it more difficult for larger businesses to attain long-term small business contracts and misrepresent themselves.Reality: Many steps have been taken to resolve this issue. The SBA implemented a ruling in June that requires companies, large or small, to recertify their size status at the end of the initial contract term (generally five years) and again at every exercising of a contract term extension option, usually between one and five years. Additionally, whenever a small business is bought out by or merges with another business (of any size), it must recertify its size status for all of its contracts, regardless of where they are in the term. Thus, from now on all contracts will be reported as held by large companies if the business holding them has grown past small business size standards or has been acquired by a large company. The SBA has also taken other steps, including increasing its staff working on finding small business contracting opportunities, requiring federal agencies to review any issues or discrepancies with their reported contracting statistics, and starting a “Small Business Procurement Scorecard,” which will monitor and score agencies on their performance on a variety of small business goals.Myth: This five year recertification allows agencies to report the tens of billions of dollars set aside for small businesses for large businesses until 2012.Reality: The new SBA policy explicitly prohibits this. It forbids small businesses that merge or are acquired by large businesses from claiming small size status for all future work, even on existing contracts. This means that as soon as a business is no longer legally considered ‘small,’ all of the dollars used must be reported according to the appropriate size standard. It also limits the time that a small business that expands beyond small standards can report as small to no more than five years – and most to within one year. All of the new SBA policies apply to all existing and future contracts of any term length, so that whenever any event that triggers a recertification need occurs – merger, acquisition, end of a contract term, or exercise of a contract option – the business must recertify itself to whatever size standard is appropriate at that time.Myth: Small business can be forced to compete alongside large businesses because of the new recertification policies.Reality: A contract that is set aside for small businesses MUST be given to a business that is certifiable as small at the time of bid submission. These new policies actually protect small business owners from having to compete with larger businesses, because there is now no way for them to acquire small businesses in order to certify small business status.Myth: There is no enforcement and there are no penalties, fines, or consequences for large businesses that get small business contracts.Reality: If the SBA determines that a businesses has misrepresented itself about the size standard, they have the right to disqualify a bid and deny the contract. If a business is found to have intentionally misrepresented itself regarding size status in order to get a contract, under Section 16(d) of the Small Business Act the owners are subject to fines and imprisonment. Companies that lost out on the bid may challenge the size of the winning companies and also file civil suits under the False Claims Act. Additionally, there is proposed legislation that would delay awarding of any contracts that have size standards attached over a certain dollar amount until the size status of the winning bidder is determined and verified by the SBA.Myth: The SBA will not release information on small businesses awarded government contracts.Reality: Information and data relating to federal contract awards is readily available to the public through the Federal Procurement Data System – Next Generation. Any person – small business owner or otherwise – may request information or reports through the database operator, the General Services Administration (GSA), if they have difficult finding data or navigating the site.Myth: The recertification procedures will change the size standards for small businesses and how they are classified as ‘small,’ much like the 2004 proposal.Reality: This is simply not the case. Small businesses are still determined to be so by the same regulations. The rules regarding size standards have not changed and are still determined by industry – some are based around maximum number of employees, some are on revenues in recent years, and some are a combination of the two. The 2004 proposal, which did not go into effect, was a broad restructuring agenda that would have made all size standards determined by the number of employees.Myth: More than a dozen federal investigations in the last six years have reported finding that billions of dollars were diverted from small businesses to Fortune 1000 companies and their subsidiaries across the country.Reality: There reports almost universally raised issues regarding the accurate reporting of contract dollars that were originally awarded to small businesses – just the sort of thing the new rules were put into place to prevent. This meant that small businesses were the original winners of the contracts, but then were bought up by larger companies. Although there are a very few occasions where large businesses won federal contracts that had been set aside for small businesses, generally this was because of a misunderstanding or of a small business not realizing it had grown beyond the size standard. None of the studies suggested that large, multinational corporations competed against small businesses for contracts. The dollars went to the larger companies because the business that originally won the contract was small. The new rules and guidelines that have been put into effect as of June 30, 2007 should prevent any further such problems of misreporting.

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