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More Ad Dollars Migrate to the Web

Initially wary manufacturers join the rush to go onlineParsippany

Manufacturers are increasingly shifting their marketing efforts away from the traditional and toward the clickable. While they’re not abandoning older tactics like print advertisements, they are beginning to rely more on their Websites, e-newsletters and search engines like Google to bring in business, according to a study by Parsippany-based SVM E-Business Solutions.

SVM, a consulting firm that specializes in online marketing, queried more than 220 U.S.-based manufacturers for the survey, which it released last month. Nearly 80% of the respondents called online marketing critical to their long-term success and said they plan to increase spending on their Websites this year. Of those planning to increase their online marketing budgets, 43% said they plan to cut spending on such approaches as magazine ads, trade-show participation and direct mail.

Almost half of those surveyed deemed their Websites the most powerful tools in their marketing arsenals. “Websites do a number of things like deliver a message, reach out and connect with people, and route information [pertaining to leads] to salespeople,” says SVM President Bob DeStefano. “Websites are becoming the hub of marketing because they let you follow users and tailor campaigns accordingly.”

Manufacturers were initially slow to board the Internet bandwagon. DeStefano says their reluctance stemmed from an inability to determine a return on their online marketing dollars and a misperception that because their goods were expensive and often made to order, they weren’t suited to online promotion.

DeStefano says the best use of manufacturers’ Websites is to provide information and customer support rather than e-commerce tools. He expects manufacturers to see a $2 return for every $1 they spend on Internet marketing.

A Website is a cost-effective way to deliver diagrams and other technical material, says Georgann Russo, marketing manager at Aerco, a Northvale-based maker of boilers and other water-heating products for customers like hospitals and high-rise apartments.

Russo says Aerco makes its manuals and other documents intelligible to the general reader and easily accessible online. This allows contractors who may not understand technical terms to quickly find equipment called for by engineering or architectural blueprints.

“We’d be at a competitive disadvantage without our Website,” Russo says. “There are hundreds upon hundreds of documents up there…If we had to print them, who knows how much it would cost?”

Over the past five years, Aerco has used the Web as a “larger and larger part” of its marketing strategy while paring back its conventional advertising effort, Russo says. Aerco nearly doubled its online marketing budget this year.

“To properly promote four new products would take at least four pages costing between $5,000 and $10,000 a page in the average [print] trade publication,” says Russo. “Now we run one ad and tell people to go to the Website for more information. She adds that “it’s difficult to present a high-tech product in one ad” while a Website offers unlimited space.

However, Aerco has shied away from promoting itself on Google or other search engines. Russo says it’s not cost-effective to pay online directories for a premier spot on their sites because key words related to its products like “boiler” are too general and yield too many hits.

In contrast, Bridgewater-based National Starch and Chemical has been spending more money in the last year to have its brands and products appear on search engines. The materials manufacturer, which has 14 U.S. subsidiaries, has also increased its advertising outlays for industry-specific e-newsletters.

Mark Green, National’s marketing manager, says the company recently embedded a link to one of its brochures in an online newsletter and quickly generated more than 500 downloads. Such results have led National Starch to shift from 5% to 10% of its marketing budget from print to online promotions in recent years. “There has been anecdotal but specific data that show that electronic initiatives have generated a greater response than print [initiatives],” Green says.

E-mail to tgaudio@njbiz.com

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