Note: This article was excerpted from Direct Response Advertising Made Easy, which is available from EntrepreneurPress.com.

An eager real estate agent wanted to use classifieds to generate leads for a home she had to sell. But to her surprise, her boss looked at her with a cold stare and said, "Honey, the people we want don't read classifieds."

Unfortunately, there are a number of myths associated with classifieds. And not surprisingly these views are often held by people who have lost money on classifieds or they simply have not done their homework. The scenario, in a sense, is like the classic story about the fox and the grapes. When the fox failed to get the grapes, he dismissed them as being no good anyway.

Although people can be mistaken about the value of classifieds, this is not to suggest that classifieds are without limitations. The truth is, because of the size of the ad, it does carry a number of built-in limitations, so to speak. For instance: It does not allow for photos; it is not suitable for detailed copy; it is surrounded by a mass of other ads; it doesn't provide space for demonstrating the benefits of a product; it doesn't allow space for testimonials, etc.

While all of these issues may rightly be a concern, it is useful to remember that classifieds have advantages that should not be ignored.

  • Classifieds are inexpensive. This is perhaps the biggest advantage of using this form of advertising. Payment is generally based on the number of words or the lines of copy used in the ad. Given the low cost, you can actually run an entire series of classifieds for the price of one full-page ad. The inexpensive nature of the ad means you can reach out to your prospects on a regular basis without breaking your bank account.
  • Classifieds are great for low-cost testing. If you wanted to test various elements of a large display ad, it would indeed be costly. The reason is obvious: Each time you test, you'd have to pay for the space of the whole ad. On the other hand, classifieds allow you to inexpensively test copy throughout a series-and at the cost of a single large display ad.
  • Classifieds are ideal for testing new concepts. Whenever copywriter Ted Nicholas was brainstorming for a new book title, he used to narrow his list of ideas down to a few titles. Then he would run classifieds and use the titles as headlines for each ad. The ad that pulled the biggest response would provide him with the winning title for his new book.
  • Classifieds are great for generating leads. The two-step approach means that you make an offer in your ad that prompts the reader to make contact with you. You invite them to contact you by phone, mail, or e-mail, etc. When the contact is made, you simply follow-up with a sales call or direct-mail package.

Ideally, you would generate leads by offering something FREE! This could be a booklet, newsletter, more information, 30-minute consultation, discount, CD brochure, or catalog.

Another benefit with this approach is that it allows you to build a mailing list of prospects and customers. Once you have their contact information, you can stay in touch with them by publishing a newsletter.

  • Classifieds can be used for local, regional, and national audiences. It's been said that the classified is the one tool that allows the little guy (or gal) to be more competitive. It enables the small businessperson to reach his or her audience on a small budget, no matter where they live.

How to Write a Winning Ad

Now that you understand the uses of classifieds and you have your products ready to go, it is time to begin working on your own winning copy. Following is a list of suggestions for creating a classified that gets results.

1. Select the right publications. This has been suggested elsewhere but it bears repeating. As a small businessperson, you will save money and avoid waste when you choose the best publications for your classified ad campaign. What are the best publications?

First, they are the newspapers and magazines that are read by your audience. Second, they are the same ones that are used by your competitors. Third, they are the publications that have a strong classified section. Typically, magazines with a large classified section are effective in pulling orders.

Although magazines and newspapers will undoubtedly be at the top of your list, do not rule out other publications. Consider newsletters published by the local Chamber of Commerce or perhaps an e-zine that targets your audience. "You must familiarize yourself with all the publications that reach the people who can buy from you," noted Dr. Jeffrey Lant in No More Cold Calls.

2. Request a media kit. A media kit is nothing more than a folder of information that provides detailed advertising data about a particular publication. In addition to the cost of the ads (also called "ad rate card"), the kit provides you with circulation figures, deadlines, and information on the demographics served by the publications.

Media kits are free for the asking and they usually come with a sample copy of the publication.

3. Examine the classified section. Once you have a few of the publications read by your audience, take a close look at the classified section. How large is it? What's the cost? Who are your competitors? What are the available categories under which your ad might appear? Must you pay by word or by line?

Examine the graphics. Are bold headlines allowed? What about headlines in all caps? Is color allowed? Borders or boxes around the copy?

If you study several issues of a magazine, you will find that certain ads are repeated over and over. This is a sure sign of a winning ad.

4. Select the appropriate category. Take a look at the category used by your competitor. Is it the best one for your product or service? The fact that classifieds have categories is a plus for this type of advertising, according to Jay Conrad Levinson, author of Guerrilla Advertising. "[Classifieds] are more powerful than ever, because there are more classifications than ever, letting you pinpoint prospects," he wrote.

5. Write a powerful headline. Since the headline is the most important part of any ad, you would be wise to spend as much time as possible in brainstorming until you come up with a winner. Begin with a list of all the benefits of your product or service. Select the one that is most likely to grab your prospects.

Then write a headline that incorporates this major benefit.

If you struggle with using a benefit in your headline, consider a headline that focuses on the problem or need of your prospects. As with the benefits, simply make a list of all the problems that your product or service solves. Then pick the one most likely to grab the attention of your prospects. Once this is done, write a provocative headline that calls attention to the problem.

Since shorter is usually better with classifieds, try to write a headline with six words or less. Sometimes, when stressing a problem, you can get away with one or two words as a headline. Example: "BAD BREATH!" Or you could write something like, "YELLOW TEETH!"

In addition to using benefits and problems in your copy, you might also consider calling out to your audience. "MEN WITH BAD BACKS!" Or you may write, "EMPLOYERS WITH HIGH TURNOVERS!"

"If you can find a one-word headline that will attract the right prospects, such as 'Accounting,' 'Deaf,' or 'Loans,' it will probably be your best headline," according to John Caples in his classic advertising primer Tested Advertising Methods. "The reason is because it can be set in big type without taking up much room."

Note: Classified headlines can be more effective when they printed in bold type or they are written in all caps.

6. Write a complete sales message about your product or service. One of the best ways to create a winning classified is to first write a lengthy sales message about your product or service and then cut it down to size. Here's how to start:

First, make a list of all the essential elements. This list should include headline, benefits, offer, call to action, contact information (mail, phone, e-mail, or website) and some type of code that allows you to know where prospects saw your ad.

Second, while using your ultimate benefit, write a detailed paragraph that shows how your product or service will help your prospects. Will it save them money? Improve their health? Ensure a job promotion?

7. Determine the required length and begin cutting. How many words can you afford in your ad? Will you test an ad with 30 words or 20? Three lines of copy or four? Once you know this, it is time to start cutting.

Simply go through the copy and cut all unnecessary words. Eliminate sentences that don't add to the message. Remove introductions and leave only those words with the strongest selling power.

8. Use telegraphic language. Write "as if you were sending a cablegram (in the old days) and you had to pay fifty cents a word," advised John Caples. This is good advice when you consider that readers of classifieds are accustomed to this type of language. They've come to expect it and can usually read it without a problem.

Therefore, instead of writing, "I will send you a free report," write: "Free report!" Instead of, "You can use this widget to save money," simply write, "Save cash!" Instead of using, "This widget is fast and easy to use," you could write, "Easy! Fast!" Instead of writing, "Guaranteed results or your money back," write: "Guaranteed!"

9. Abbreviate where necessary. Certain abbreviations are easily understood by respective audiences. If you specialize in Business-to-Business services, then your audience will certainly understand the use of "B2B" in your ad. Most readers would understand "Bklt" to mean "Booklet."

Since you will be paying by the word (or lines of copy), you want to tell your story in as few words as possible. This idea is particularly useful when writing your contact information. Example: Instead of "Post Office Box 10," write: "Bx 10."

Note: Don't forget to code every ad, as this will allow you to track results. Some businesses use different names to call in each ad: "Call Mary" will appear in one ad; "Call John" will appear in another one. Sometimes this is done to test publications: "Call Mary" will appear in magazine A; and "Call John" will appear in magazine B.

Another method of coding is to include a suite number in your address: "Suite A" will appear in one ad or one publication, while "Suite B" will appear in another.

10. Write a second classified and begin testing. Write a second headline and test it in the same publication. Measure the results. Or, keep the same headline and change the offer. Run this in the same publication and then measure the results.

Once you've determined which ad pulled the most response, begin testing it in different publications.

To learn more about other direct-response advertising tools, read Direct Response Advertising Made Easy from EntrepreneurPress.com.