Did you know that McDonald’s uses Other People’s Money (OPM) to help stretch their Advertising Budget? It’s true – and YOU can get it too!:
Ray Kroc knew a thing or two about building a business from scratch. When you start a new business, you have to make critical decisions about your future right from the start.
After you’ve decided what your product or service will be, you choose a fitting business name. Then you go online or down to the Secretary of State’s office and register your business. Then you go online and grab a domain name for your website …. and then you go to the bank to set up your business checking account.
Somewhere along the line, usually when you sit down with your banker, you are confronted with the decision to accept credit cards as payments for your products or services.
At this step, most business owners simply weigh the expense of taking cards versus the need to appease the customer’s payment preferences. CAUTION: This should definitely not be a decision that is based solely on the expense side of your P&L.
The three challenging questions most new businesses encounter in the decision to accept cards are:
1) Merchant accounts are confusing; I don’t understand how the whole system works?
2) I see the cost but what are the benefits of accepting credit cards?
3) What company should I go with to set up my merchant account?
There are many reasons to accept cards, but for the purpose of this post let’s focus on the BIG one. By far, the biggest reason to accept cards is your ability, as a new business, to tap into – and piggyback off of – a huge advertising budget. “HUH? What does that even mean?! WHO’S advertising budget? I don’t have a huge advertising budget!” (That’s what you’re thinking, right?)
Answer: The Credit Card Companies’ Ad Budgets!
In 2013 McDonald’s spent nearly one billion dollars on advertising. $988,000,000 to be specific. That is a huge number!! I am sure most of us would agree that was money well spent, considering that McDonalds is regarded as one of the most successful companies in American History. However, in that same year, the credit card industry dwarfed McDonald’s advertising budget, spending more than 3 times that amount, to market its branding, logos and industry. All combined, Visa, MasterCard and American Express spent $3.4 billion on marketing expenditures. (This doesn’t even include the marketing budget for Discover Card.)
“SO!? What does that mean to ME??”, you ask.
Simply put: it means that when you accept credit card payments from your customers, the credit card industry HELPS YOUR advertising and branding efforts! Just the signage and logos in your window and on your cash register alone, are major brand recognition tools that draw people IN – because they have seen it SO often! And as a merchant who accepts cards, you can use these logos on ANY of your own Advertising.
Statistics Show: Businesses that accept cards have 35% GREATER SALES than identical businesses who do not.
Making the important decision to accept credit cards for your business can be difficult and time consuming, but an Ignite Payments Representative can boil it down in quick order. As a new business owner, what would you rather be doing? – Learning about the nuances of the credit card industry or growing your new business? After all – if you don’t make money, you go broke and then who cares about credit card processing anyway?