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Click here to view a 20-minute video of the key takeaways.

These days Madison Avenue is obsessed with the science of measuring the short-term sales effect of advertising and converting existing demand. Performance marketers calculate ROI on a month of media.

Journalist Doc Searles wryly observed, “Remember the movie ‘Invasion of the Body Snatchers?’ Same thing here. Madison Avenue fell asleep, direct response marketing ate its brain, and it woke up as an alien replica of itself.”

How advertising really works: Meet Steve’s Pest Control of Columbia, Missouri

1,095 miles to the west of New York City lies Columbia, Missouri, the home of Steve’s Pest Control, “Missouri’s number one choice for pest control.”

Steve’s Pest Control knows what Madison Avenue has forgotten. To generate substantial sales and profit, a business needs to create future demand rather than just obsess over converting existing demand.

Steve Hotsenpiller and his wife Anita started their business over three decades ago with one truck. They bought ads on a small radio station.

Each year, they devoted about 8.5% of their revenues to advertising. As they grew, they bought ads on more radio stations and soon became one of the largest advertisers on local radio.

Their ads are charming, funny, and entertaining. They usually end with the jingle that exclaims, “Now you’ve got a friend in the pest control business – Steve’s Pest Control!” Today, with over 90 trucks, Steve’s Pest Control is now the undisputed leader in the pest control business.

To understand the magnitude of the brand Steve’s Pest Control built with long-term advertising on AM/FM radio, the Cumulus Media | Westwood One Audio Active Group® commissioned MARU/Matchbox to conduct a study of 98 consumers in the Columbia-Jefferson City DMA in December 2023.

Steve’s Pest Control dominates unaided brand awareness

Consumers were asked, “When you think of pest and insect control services, which ones comes to mind?” Respondents had to write in all the brand names they could think of. They were not provided with a list of firms.

Steve’s Pest Control leads in unaided awareness at 34%, beating all national brands. Steve’s Pest Control’s unaided awareness is nearly 50% greater than Orkin, a major national brand that’s been around since 1901! Steve’s Pest Control’s unaided awareness is over five times greater than Terminix, a national brand that is almost 100 years old!

The longer people have lived in the area, the greater the awareness of Steve’s Pest Control. 43% of consumers who have lived in Columbia-Jefferson City for 10+ years were able to name Steve’s Pest Control on an unaided basis. 19% of consumers who have lived in the area for less than 10 years were able to name Steve’s Pest Control unaided when asked about pest control services.

This is great lesson for local retailers. Your business might be super famous but every day new people move to town who have never heard of your business. An important reason to continuously advertise your business. Also, advertising memories fade.

Compared to other categories, Steve’s Pest Control owns its category as the best-known brand

Consumers were asked the name of Columbia-Jefferson City brands they could recall on an unaided basis for twelve different retail categories such as hospitals, home improvement, roofing, auto dealerships, HVAC services, injury attorneys, window replacement, etc.

“Don’t know” is the most common response for most of the categories measured for unaided awareness. For example, when asked to name a firm that specializes in roofing, 60% said “don’t know/none.”

Every advertiser has two jobs: Creating future demand and converting existing demand

Creating future demand is “being known before you’re needed.” Creating future demand is advertising to that much larger group of consumers who are not in the market and are not ready to buy now but will be in the future. The goal is making them feel familiar with and positively toward your brand in order to get them to gravitate toward them when they enter the category.

Converting existing demand is advertising to that small group of consumers who are ready to buy now and capturing as large a share as possible of them. It is estimated only 1-5% of people are “in the market” at any one period of time.

Converting existing demand and creating future demand require different creative/copy approaches and different media strategies

Marketing effectiveness expert James Hurman writes, “Converting Existing Demand is most efficiently achieved by tightly targeting those ‘in the market’ with rational messaging of product and price information that persuades them to choose our product over others.

Creating Future Demand is most efficiently achieved by targeting very broad audiences of ‘all category buyers’ with emotional messaging that is designed to stand out and be enjoyed by consumers, creating positive memories of our brand that will influence future purchase decisions.”

Sales event or promotional copy does not work on the large group of consumers who are not in the market and not ready to buy now. Creating future demand is about creating positive memories.

The consumer journey: Awareness, favorability, ad recall, and purchase intent

Across all stages of the consumer journey, Steve’s Pest Control leads the market

Steve’s Pest Control usage of AM/FM radio advertising has built a dominant brand. It is so impressive for a local business to win against big national brands!

Steve’s Pest Control’s unaided awareness (34%) is +32% greater than the next brand. Its ad recall (40%) is two and half times the nearest competitor. This is significant as advertising recall is the most responsive measure of advertising activity.

Steve’s Pest Control leads all brands in favorability. In terms of purchase intent, Steve’s Pest Control is two and half times larger than the next brand.

Steve’s Pest Control usage is two and half times greater than the nearest competitor. Its brand preference is more than twice as strong as the next brand.

AM/FM radio advertising works: Among AM/FM radio listeners, Steve’s Pest Control awareness is +18% greater than in the overall market

Steve’s Pest Control’s AM/FM radio ads are memorable; AM/FM radio ads are most associated with Steve’s Pest Control

Those who recalled Steve’s Pest Control advertising were asked the here they have seen or heard advertising for the brand. To a large degree, Steve’s Pest Control ads are most associated with AM/FM radio. Of those who recall having been exposed to Steve’s Pest Control ads, 48% say they heard AM/FM radio ads.

In addition to the MARU/Matchbox brand study, System1, a leading creative testing firm, was commissioned to survey 150 respondents in the Columbia-Jefferson City market to measure Steve’s Pest Control AM/FM radio ads in December 2023.

According to System1, Steve’s Pest Control ads were some of the best testing ads in the U.S. compared to System1’s audio creative databank of U.S. AM/FM radio ads tested.

System1 evaluates ads on three key measures: Star Rating, Spike Rating, and brand recognition.

Star Rating: Ads are assigned one to five stars, which predicts long-term brand growth by measuring positive emotional response. Steve’s Pest Control’s ‘The Grinch’ holiday ad scored an impressive 2.8.

Spike Rating: This score evaluates the short-term sales potential derived from the strength of the branding and the intensity of the positive emotional response. Given that the category entry point for pest control is infrequent, the 1.03 modest score for the Steve’s Pest Control ad is good.

% brand recognition: The captures how strongly an ad is associated to the brand. The strength of the branding is driven by the % of people who recognize the brand by the end of the ad. One of the most important audio creative best practices is “brand early and often.” Mention the brand name within the first two seconds and a total of at least five times in the :30 second AM/FM radio ad. Steve’s Pest Control’s ad scored an 84 for brand recognition, which is in the “good” range.

Allison O’Toole, System1’s Partnerships Insights and Strategy VP says,

“Steve’s Pest Control’s category ownership–built on long-term radio advertising–shows the potential of audio to work hard and deliver lasting results for any brand, with above-average Star Rating, Spike Rating and Fluency Rating scores in System1 testing confirming the quality of Steve’s Pest Control advertising. It’s a great demonstration of what we found in researching the impact of over 100 radio ads in Listen Up!–audio ads are equally effective as TV ads in creating long-lasting effects for brands by building brand fame, improving brand trust, and encouraging action by customers.”

“There are a series of six best practices identified in Listen Up! that any brand hoping to emulate Steve’s Pest Control’s success can benefit from. Steve’s Pest Control clearly shows several of these in action, notably using right-brained creative features like an unfolding story, humor, and characters to make ads more enjoyable and emotionally engaging; making ads memorable and easily recognizable with their consistent tagline, ‘Now you’ve got a friend in the pest control business – Steve’s Pest Control!’; and branding early and often to improve listener processing and create greater short- and long- term benefits with improved brand trust.”

Steve’s Pest Control offers a master class on creating future demand and how building a brand is the main driver of long-term growth and profit

Les Binet, the global head of effectiveness for adam&eve DDB London created this outstanding one pager describing how advertising works:

Easy to mind, easy to find

By patiently investing in brand building advertising to create future demand, Steve’s Pest Control has made his service “easy to think of, and easy to buy.” His lighthearted and humorous ads have “created positive feelings and associations” with “broad reach ads that people find interesting and enjoyable.”

In the end, Steve’s Pest Control’s lesson for Madison Avenue is that advertising is not about manically measuring short-term performance, it’s about “being known before you’re needed.”

Key findings:

• Steve’s Pest Control offers Madison Avenue a master class on creating future demand and how building a brand is the main driver of long-term growth and profit
• Through its long-term use of AM/FM radio advertising, Steve’s Pest Control dominates unaided brand awareness; Across all stages of the consumer journey, Steve’s Pest Control leads the market
• Compared to other categories, Steve’s Pest Control owns its category as the best-known brand
• Every advertiser has two jobs: Creating future demand and converting existing demand; Steve’s Pest Control excels at creating future demand
• AM/FM radio advertising works: Among AM/FM radio listeners, Steve’s Pest Control awareness is +18% greater than in the overall market
• According to System1 creative testing, Steve’s Pest Control’s AM/FM radio ads achieve nearly a three star, one of the best test radio ads in the U.S.; AM/FM radio ads are most associated with Steve’s Pest Control

Click here to view a 20-minute video of the key takeaways.

Pierre Bouvard is Chief Insights Officer of the Cumulus Media | Westwood One Audio Active Group®.