Over the past 30 years in Marketing and Advertising, this topic has come up every single day. Why Advertise? Yes, it can be costly if it doesn't work. But, if you do it right, it is quite the investment. Most small businesses don't think they have the money or have been in business X amount of years, everyone knows I'm here! That maybe true to some degree but it's not the case for everyday people. John Doe may know you are in business, heck he may do business with you. Does he tell everyone about your business everyday? Probably not! That is where advertising comes to play.
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