Advertising: 'It's not working like it used to'

Sunday, July 30, 2006

YARMOUTH, Maine - Smaller rehab providers who spend big money on TV, newspaper and radio advertising have found they're getting less bang for their buck these days.

Rick Perrotta, president of Network Medical Supply in Charlotte, N.C., estimates that, despite spending about the same amount of money on advertising this year vs. last year, he's seeing only 75% of the return on his investment.

"It's becoming more difficult and more expensive to generate leads through advertising," he said. "It's not working like it used to, particularly in TV."

A combination of factors could be decreasing the effectiveness of ads, industry sources suspect: There could be fewer people who need wheelchairs and scooters in a particular area. Moreover, ad agencies are telling providers there are more people using DVRs to fast-forward through TV ads.

Jerry Keiderling, who heads up The VGM Group's U.S. Rehab, which recently launched a program to help its members develop ad campaigns, also offered this: "There's been so much newspaper coverage of the fraud in the industry that, maybe, people are also being more wary of ads, and I think that's a good thing."

Tim Pederson, CEO of WestMed Rehab in Rapid City, S.D., hasn't seen the effectiveness of his ads drop, but he has learned that keeping ads effective means keeping them "relevant."

Bernie Hamann, who owns Lakeside Mobility in Rochester, N.H., with his wife, Cindy, agreed.

"You need to keep things fresh," said Hamann, who recently decided to double the number of ads that he runs during Boston Red Sox baseball games. "In the five years that we've been advertising, we've had 40 different TV commercials out there."

Just the same, Perrotta's faith in advertising is dwindling. He now plans to focus more attention on bringing onboard sales reps to knock on doors, looking for referrals.

"We've had a few before and they've never worked out, but we're going to try and get back into that arena," he said.