You’re probably already familiar with this line attributed to the Philadelphia retailer John Wanamaker:

Half the money I spend on advertising is wasted; the trouble is I don’t know which half.

Hold that quote in your head for a moment while I relate an anecdote about Marshall McLuhan. You’ll remember McLuhan as the Canadian philosopher-cum-guru who coined the phrase “The medium is the message” and enshrined the distinction between “hot” and “cool” media (and had a cameo in Annie Hall).

In 1965 the journalist Tom Wolfe followed McLuhan on a speaking tour of America and watched him blow businessmen’s minds with his gnomic pronouncements on the future of the media. Wolfe describes one such encounter:

McLuhan is sitting in the Laurent Restaurant in New York with Gibson McCabe, president of Newsweek, and several other high-ranking communications people, and McCabe tells of the millions Newsweek has put into reader surveys, market research, advertising, the editorial staff, everything, and how it paid off with a huge rise in circulation over the past five years. McLuhan listens, then down comes the chin: “Well…of course, your circulation would have risen about the same anyway, the new sensory balance of the people being what it is…”

Here’s a scary thought. What if John Wanamaker was being overly optimistic? Maybe business owners should count themselves lucky if they can say with confidence that only half the money they spend on advertising is wasted.

Sometimes it’s possible to tell when advertising leads to a sale. Often it’s not.

Maybe your new radio ad brought in a dozen new customers, or maybe those customers would have found you some other way.

Maybe your business is booming because of that billboard you put up on Highway 11, or maybe it’s spillover traffic from that new Starbucks next door. Or maybe it’s word of mouth. Or maybe it’s…”the new sensory balance of the people”!

But what choice do you have? That’s the way advertising works, right? You pay for an ad, and you hope the increase in sales is greater than the outlay of buying the ad.

But what if there were another way to advertise?

What if you only had to pay after the fact, once the transaction had been completed?

What if your advertising dollars went directly to new customers…and the past customers who had referred them?

What if every time you closed a deal, it was broadcast on your customer’s Facebook page for all her friends to see?

You might think StepRep is just about managing your reputation. But that’s just one little part of our vision of changing the way businesses advertise.

We’ll be talking more about this in the coming weeks. Here’s a quick video that gives the broad outline.