Barter transactions entered the history of the economy immediately after the formation of the commodity industry. Manufacturers of various types of products began to exchange one produced product for another. Such interchange was carried out before the appearance of money, after their appearance, and does not lose popularity even in our time. Everything is natural. If one item is not needed by one person, then the other one simply knocks himself off his feet in his search.
Many times in your life you have used barter exchange without even knowing it. Sometimes a product is exchanged for a product in order to get the necessary things. Isn't this what the cartoon characters "Prostokvashino" are talking about? Even animals understand how profitable barter deals are.
However, it is not always possible to quickly find an exchange partner. Although each of us is sure that somewhere there is exactly the person who will definitely need your products. Therefore, we resort to the use of advertising. After all, the sale of products by barter with the help of advertising is especially effective. Advertising activity helps to spread information about the product to a specific target audience, which in turn makes it easier to find an exchange partner.
Naturally, the manufacturer who prefers financial barter transactions often asks the question: "Is it possible to get advertising by barter?" Yes, you certainly may. After all, barter advertising is the technology of the future. Many advertisers agree to a deal like: service for service, product for service, or service for product. Each of them agrees to update the exchange list daily if the case so requires.
Order advertising by barter - believe me, it is very profitable. Be that as it may, but modern advertising is not only informative. She helps support feedback with those who are interested in it. That is, between two companies wishing to conclude a barter deal.
Barter is a kind of contract that facilitates the exchange of goods and services without the slightest hint of finance. Usually there are two parties involved in the contract, but rarely their number can reach three. However, even in these cases, the money remains in the collateral value of the products. Naturally, in this situation, the cost of goods on the one hand and the other must be in equilibrium. And rightly so, no one has the right to violate their own vision of the value of exchanged goods.
No matter how hard we try to present our product in a more favorable light, it is definitely impossible to do without product advertising in our time. It is self-evident that the engine of a product in the labor market not only has a powerful influence on the formation of demand, but also controls it.
A huge headache for a large number of organizers is providing an event with a sufficient number of options and advantages on an often limited budget. It's no secret that barter - that is, mutually beneficial cooperation for the provision of goods or services by the organizer and contractor in equal monetary terms without direct monetary payments - is a very common option for working with events. How to make barter cooperation maximally "environmentally friendly" and beneficial for both parties?
Let's start with the fact that by barter you can get almost anything. Venue, catering, souvenirs, printing, transfer and accommodation, information support - you can list for a very long time. And, it should be noted that barter partners are no worse, no less significant than commercial ones. They work in exactly the same way. And the big question is where to find those who, as an organizer, will be ready to provide you with everything you need, and what can you offer in return so that the other side is satisfied? The algorithm for searching for barter partners, as a rule, is as follows:
List of services from a barter partner
Making a detailed list of what you need for the event and what you would ideally like to barter. Just sit down and write the list from the very beginning:
- platform - and describe in detail what, your requirements for it, if there are specific options - list;
- drinking water— coolers or bottles, how many;
- coffee break - what it should consist of, how many times during the day it should take place;
- wi-fi - what speed, how many participants;
- polygraphy - a list of positions with a detailed description, the number of each;
- photography - what tasks, what time interval, how many photos and in what time frame do you want to receive;
- the list is endless.
List of partner services
Making a detailed list of what you can give your partner in return. It is important to remember that barter is a mutually beneficial cooperation. If there is no reciprocity, then this is sponsorship.
Usually, the organizer can offer basic options (posts on the social networks of the event, logo on the website, on the printing and press wall, stand, logo in the breaks on the screens, handout to the participant’s package, branding of volunteers’ T-shirts / lanyards for badges / networking zone, announcement by the moderator with scenes, prank at the event). Larger packages on your part imply a large amount of barter support from a potential partner.
Important: be prepared to not only send out compreds (it won't get you anything), but really work really hard with a potential partner and be creative to come up with an integration that will help your opponent fit into your event in a relevant way and get the most out of it. This is very important point- no one owes you anything, and you are just as interested in the goods or services that you want to receive for free as your partner is in helping him to shine in front of your audience as profitably as possible.
I have a google doc in which I collect interesting ideas for potential future partnerships - because the simple placement of logos and stands is no longer interesting to anyone, much more relevant today is the adequate and high-quality integration of a partner into a project, both commercial and barter.
Unique offer for partners
For each direction, drawing up a separate, unique offer for partners. It is important to understand that the printing house, the taxi service and the public speaking school are interested in different activities at your event, different options from among those that you can offer. Therefore, it is very important to carefully approach the development of an offer for each niche, for each company. Believe me, it pays off in the long run.
Market analysis
Market analysis and listing of potential barter partners for your event. Let's look at the example of drinking water: in a search engine, you ask the query "Water delivery" - and study the first 2-3 pages that appeared on your request. Call the indicated numbers, find the person responsible for marketing / sales / PR - in different companies, representatives of different departments can solve the same issue. And then it depends only on you how you can convey the value of your offer, whether you can guarantee the presence of an up-to-date target audience at your event. There is another option - to ask fellow organizers who supplies water to them, and on what terms. The third option - you can not ask, but look at photo reports from other people's events and draw conclusions. True, in this case, you will definitely not know whether it was barter, catering included in the budget of the event, or just buying water in Auchan.
Negotiation
Search for contact persons, distribution of a compred and telephone conversation. The most important and difficult thing when working with partners of any level is to find a decision maker - a person who is competent to make decisions on your issue. The key task is to persistently seek a conversation with him, because, in fact, all the other employees of the company will still not be able to resolve your issue. It is also very important to understand that it is easy to send offer, even beautifully and correctly compiled specifically for a particular company, is not enough - you need to make sure that it is received, read and considered. This can only be done with telephone conversation or personal meeting.
Important: when you start interacting with contact persons in companies you are interested in, you are faced with the fact that this is a huge layer of work, where one of the key elements is personal contact. Therefore, accept right away - if you are chaotic and / or an introvert - then it will be very difficult for you to engage in partnerships. Because, in fact, working with barter partners takes as much effort, time and energy as working with commercial partners.
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Conclusion of a mutually beneficial agreement
Search for a variant of interaction that suits both parties, conclusion of an agreement. It is clear that if you want to receive 600,000 worth of catering services from a partner, and in return are ready to offer placement of a logo on the site, then this may make sense for a partner only in a situation where this is the site of the Olympics. But seriously - measure your options in money and do not be greedy when discussing who, to whom and how much. An adequate assessment of your offer and “reasonable consumption” of what a partner can offer you will most likely be the key to a signed contract.
Coordination and control of terms and volumes
Coordination of terms, volumes, procedures for obtaining by the parties of what is due to them. I will not tire of repeating - sign all the agreements. Especially if you are interacting with a partner for the first time, especially if you feel insecure about getting what the other party promises you. Calculate the deadlines for the production of what you need, promptly request all the materials you need to fulfill your part of the obligations. Control that everything is done in strict accordance with the signed partner package.
Thanks and Summing Up
After the event, be sure to thank the partner, get feedback, close all the documentation. Barter relations, as you probably already understand, are as important and frequent as commercial ones. A clear and timely fulfillment of obligations on both sides is highly desirable for positive conclusions about joint work on the project. If everything went well and you and your partner were mutually satisfied with each other, then, most likely, the first joint event will become the basis for regular barter relations. At least that's how it often happens to me.
Sometimes a situation arises when one of the parties is dissatisfied with what they eventually received. For example, you invited a coffee shop by barter, assuming a natural flow of participants at an event of 5,000 people during the day. The coffee point does not pay for participation, but gives unlimited coffee to your entire team of 50 people, earning on sales to everyone else. But something went wrong, hail, storm and +12 instead of the +25 you expected - and instead of 5,000 people, 700 came.
Or, for example, you gave an information partner options in the amount of a large partner package (handout, printing, stand, press wall, posts, logo, and so on) - in return, you received 300,000 banner impressions on the main page of this partner’s website, and also participation in mailing list, and more posts on social networks, where there are tens of thousands of subscribers. And there were as many as 12 clicks from this information partner on tagged links. Will you be satisfied? Is it mutually beneficial? No.
However, when working with barter, there is a share of partnerships, the result of which cannot be predicted without a test. Therefore, you should always be prepared for the fact that the negative from the side of barter partners will have to be worked out, and some will be included, if not on the black list, then definitely on the list “not recommended for the future under any circumstances.”
More importantly, there is such a position of the organizers: “Either by barter, or we can do without this option at all.” Wrong premise at first. If you could not attract any barter partner, but you, for example, still need drinking water - do not be greedy, even just order a cooler for rent and buy glasses. It is inexpensive, but without it it will be worse for the participants of your event, and, consequently, for your organizational karma.
Also, there is no need to try to attract by barter a partner who is obviously unequal to you. If, for example, you are planning a local hand-made fair, it is unlikely that Megafon will be interested in becoming your Internet partner and giving you wi-fi for barter participants. Balance the weight categories when compiling and sending offers.
Never forget that in addition to providing options from your side directly at the event, you can offer barter partner support options on your other projects. For example, when we had a children's club at the "Severe St. Petersburg SMM" conference on barter (you could come to the conference and leave the children under the supervision of educators so as not to be distracted from the reports), which, in addition to being placed on advertising media, on the website, on printing and in in social networks we offered to place posts in our group "Children's Petersburg" - it has nothing to do directly with the conference, but this proposal seemed relevant and interesting to the partner - because there are more than 60,000 target audience, St. Petersburg mothers. Always make a complete list of your options, and remember that for individual partners, they can be a deciding factor when deciding whether to barter with your event.
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A steep peak in the advertising marketBack in late 2008, many research companies and major advertising agencies were predicting a sharp drop in Russian market advertising. The reality turned out to be worse than forecasts: a serious decline in the advertising market affected almost the entire world, but in Russia it turned out to be even more significant than in most other countries.
The depth of the decline in the Russian advertising market is estimated by various analysts at 15-50% compared to the same period in 2008. Thus, according to TNS Media Intelligence, the number of advertisers in the first quarter decreased by 11%. The strongest decrease in the number of advertisers was recorded in the press (-34%). On TV their number decreased by 7%, on radio - by 4%.
According to the Association of Communications Agencies of Russia (ACAR), the fall of the Russian advertising market in value terms in the first quarter amounted to 29%, from 58-59 billion to 41.5-42.5 billion rubles.
Vladimir Makarov, head of the Moscow Committee for Advertising, Design and Information, estimated the decline in the advertising market in Moscow in the first six months of this year at 40-45%.
Thus, all experts agree that there has been a significant drop in the market volume, and if television and Internet advertising keep afloat due to powerful audience coverage and the possibility of precise targeting, then the situation in the segments outdoor advertising, radio and print advertising is quite dramatic. Thus, according to the data of the already mentioned ACAR, in the first quarter of 2009 the decline in these segments amounted to 36, 38, and 42%, respectively. The segment of radio advertising suffered the most, since radio does not have the flexibility inherent in the print press - the ability to manipulate circulation, frequency of release, level of printing performance, etc., and therefore is especially dependent on the content of the advertising space.
It is clear that even despite the possibility of some revival of the market in the second half of 2009, the situation remains quite unpleasant. Many advertising agencies and the media are placed in difficult conditions, and sometimes we are talking about elementary survival.
Is there a way out?
Of course, the decline in the advertising market is not due to the fact that the representatives of the Russian business suddenly stopped needing advertising. The drop in demand is caused by the unenviable state of the business or the increased caution of customers. Many companies have lost significant sales volumes, faced a sharp decline in available lending, or simply still cannot assess the medium-term prospects for the development of their business. Therefore, top managers take a wait-and-see attitude. As a result - reduction and/or redistribution of advertising budgets.
Of course, advertisers understand the situation and do not sit idly by. Advertising agencies, operators and specialized publications actively use such methods of retaining and attracting customers as freezing prices, expanding the range of discounts, creating special offers(including batch), transition to the post - payment system. Of course, these actions mitigate problems to some extent, but it is clear that most of them are win-lose solutions. That is, if customers receive certain discounts and other benefits, advertisers have to pay for all this: as a result, they receive less money, work in tougher conditions, indirectly lend to their own customers and make other concessions that are harmful to themselves.
Barter as a win-win solution
Is it possible in the harsh conditions of the modern market to find a solution that would be beneficial for both advertisers and participants in the advertising market: operators, agencies, mass media? In our opinion, in many cases, such a solution can be the use of barter schemes, and here's why.
Advertisers refuse to place ads due to the lack of free money, which, in turn, is caused by a drop in demand. A vicious circle is formed: due to a drop in demand, customers refuse to advertise, as a result of refusing to advertise, they lose customers, and, therefore, there is again no money for advertising. But at the same time, many financially stable companies, activating promotional activities against the backdrop of the departure of competitors from the media field, they have a unique chance to increase their own market share with little bloodshed. And, as experience shows, the market share captured during the crisis does not decrease long after it ends. It turns out that advertisers are vitally interested in not reducing the intensity of advertising, because this is a way to somehow support sales and not be squeezed out by competitors.
It would seem that the interests of the parties are directly opposed, and the final result depends on "who will gather whom." But actually it is not. The general benefit of the operators of the advertising market and their clients can manifest itself when some (advertisers) are able to sell their own products and at the same time place advertisements without spending “live” money withdrawn from circulation, while others (advertisers) sell more advertising space for the full price, even if the payment is received not in traditional money, but in useful goods or services. Thus, if both the sales problem and the advertising payment problem are solved within the same deal, everyone wins.
Many readers may think that the use of barter is a feature exclusive to domestic and other developing economies, and, moreover, in situations of collapse financial system when no one has money, and if they do, then tomorrow they will lose their value. But in fact, this opinion is far from the truth: according to some estimates, over 350 thousand enterprises in the US are involved in barter transactions. Moreover, about 65% of Fortune 500 companies use barter at least once a month.
Advertising market operators from developed Western countries also often deal with barter. To quote RBC-Daily, which, in turn, refers to the Wall Street Journal: “Last year, the total volume of the British advertising market amounted to 12 billion pounds, of which 100 million pounds fell on deals concluded by media agencies on barter terms. GroupM, a subsidiary of the British communications holding WPP, forecasts a 5.6% drop in UK advertising revenue this year. The volume of barter transactions, according to experts from the United Kingdom, in 2009 will increase by 30%. So, we see that foreign advertisers use barter, and that during the crisis, interest in such solutions is growing. But is everything so simple?
Benefits of open barter
In truth, the so-called closed, or classic, barter, when one specific product / service is exchanged for another specific product / service, in a strictly defined volume and in a strictly certain time- is not always optimal for advertising market participants. Since clients of advertisers offer a limited range of goods and services, it is not always profitable for advertisers to change their advertising space for these goods and services. For example, why manufacturers of excavators or mineral fertilizers need advertising is quite understandable. But what the media agency will do with fertilizers and excavators is a mysterious question. The agency might have been much more in need of the services of accountants and lawyers, or the delivery of meals for employees, or the payment of office rent, but you never know what else.
Therefore, it is much more convenient to use the open barter scheme. All over the world, this service is implemented through specialized barter platforms. The barter platform is commercial organization, which provides a trading platform and accounting system for its members. Participating companies buy and sell their products to each other using an internal currency called "barter dollars", "trade dollars", etc. . Participants are not required to buy from those to whom they sold their goods or services, and vice versa. For barter money, the products of any of the participants in the system are available at any time. Therefore, for example, an operator of the advertising market can sell advertising placement services to a manufacturer of excavators for "barter money", and use the proceeds to purchase company cars in two days, and in another week - an annual office cleaning service.
An additional advantage of barter sites is that these sites are proactive. They employ brokers who help different participants find exactly what they need, whether it be advertising or other goods and services. Brokers are interested in the participants finding each other, because the site receives a small percentage of transactions.
It should be especially noted that advertising agencies and operators, general and specialized publications, as well as other advertising placement companies are very attractive partners for barter sites and their participants. After all, advertising is one of the main types of services that the vast majority of companies need, and on a regular basis.
Of course, barter will not be able to completely replace the sale of advertising for "live" money, if only because advertising companies need to pay salaries and taxes. But, according to world experience, transferring 10-15% of the volume of transactions to barter can be very productive. It is precisely on this share that sales of advertising space will grow, which can be considered an excellent result.
According to Magna Global Trading, the current annual turnover barter transactions in the advertising market exceeds 3 billion dollars, and in 2009, due to the intensification of the financial crisis, this amount may increase by 30%. Of course, while most of this amount falls on North America, but European countries are already actively adopting this experience.
What will happen when the crisis is over?
First of all, it is worth recognizing that a quick exit from the crisis is not expected. Although Zenith Optimedia expects the global advertising market to revive starting in 2010, significant growth in Eastern Europe, and in particular in Russia, will not occur until 2011 at the earliest.
However, it cannot be said that if there is a crisis, then barter flourishes, and if there is no crisis, then barter becomes unnecessary. As the experience of many foreign barter sites shows, in “bad” years their turnover grows more intensively than in a “healthy” economy. But growth continues even when markets stabilize. Clients who once came to barter sites out of necessity have the opportunity to appreciate the convenience of barter transactions and become regular customers. Thus, in quite calm 2006 the US barter market grew by 10%. According to 2005 data, one in twelfth small businesses in the United States used barter at least once a year. current year, and 7% - on a regular basis to reduce costs in "live" money. Moreover, such companies, on average, had a turnover of 13% more than competitors who do not use barter.
The advertising business is no exception. In a situation of intense competition, characteristic of all developed and many emerging markets, advertising market operators, as a rule, are ready to offer customers more services than they are able to purchase. Therefore, it always makes sense to provide additional placement of advertising through its sale on barter sites. When times change, a tool for survival easily turns into a tool for gaining superiority over competitors.
The format of “barter” cooperation is deeply rooted in history. A year ago, we ourselves actively advised brands to work with bloggers on a barter basis. As a result of such cooperation, brands saved a significant part of their budget on advertising placements, and bloggers got to know the product better. Now, work on barter basis every day loses its relevance and that's why.
The numbers don't lie
According to our statistics, on average, up to 90% of bloggers refuse to work on a barter basis.
For example, let's take one of the brands that have worked on our platform before. During advertising campaign he invited 215 bloggers to cooperate: of them, more than 190 refused even at the stage of reading the brief.
Of the 21 bloggers who accepted the invitation to collaborate, half of them managed to agree on publications. Thus, only 5% of bloggers agreed to such a format of work.
It should be borne in mind that when working through our platform, you are insured against the fact that the blogger changes his mind to cooperate after receiving the goods. When working directly, often receiving goods by barter, bloggers refuse to publish a post and interrupt communication.
Marketing channel fee
Regardless of the quality of the goods, in everyday life you will not be able to pay them for services: whether it be a manicure, car rental or air tickets - they will ask you for money in return. In today's world there is no such marketing channel, where it would be possible to pay for the goods.
Appropriate attitude
When a blogger receives money from an advertiser, he treats the order accordingly. He performs his work qualitatively and within the agreed time frame. In the case when he is paid with a product or service, the blogger feels a frivolous attitude on the part of the advertiser and reciprocates.
It is important to take into account that people have different tastes, and it is quite difficult to objectively assess the quality of a product or the level of a service. The blogger may remain dissatisfied and, on the basis of this, refuse to cooperate. In a commercial partnership, the blogger will post a post even if he or she would not actually use the advertised product or service.
What to do?
In our experience, the most optimal format for working with bloggers is barter + surcharge. This is a profitable option for both parties: the advertiser will significantly save money on placement, and the blogger will get better acquainted with the advertised product and integrate it into their content.
Bartering is also possible within the platform, but our marketers strongly do not recommend using given format due to a large number of failures from bloggers and a low level of creatives.
