04-06mill

Greetings!

Is it really October already? (Wait, only old people say things like that!)

How about a little advertising history this month? I always find it fascinating and in both of these stories, the necessity to survive was indeed the mother of invention.

In the 1800s, Smith Brothers was battling copycat cough drop manufacturers trying to piggyback on the brothers' success with competing products (think "Pine Brothers" or "Luden's" for example).

William and Andrew Smith tried "branding" (certainly before anyone coined that phrase) by placing their bearded portraits on the point-of-purchase materials—the glass bowls used for counter display and the pocket-sized packets that shopkeepers used to package each cough drop sale.

The story goes that an enterprising Smith Bros. distributor provided signs touting the drops' 5¢ price and told shopkeepers, "Make sure every customer gets a nickel in their change." Reportedly, many customers "impulsively flipped the nickel back at the shopkeeper and bought some cough drops." Thus was the principle of "the impulse buy" introduced—and point-of-purchase marketing became a retail tool beyond price!

Almon Strowger was an undertaker in Kansas City in the late 1800s. The wife of his competitor worked the "cord board" at the local telephone exchange. Whenever a caller asked to be put through to Strowger, calls were deliberately put through to his competitor. After spending years complaining to his local telephone company, Strowger found a way to solve the problem.

With electromagnets and hat pins, Strowger developed the first automated telephone switch. This was the first automatic telephone exchange to be installed anywhere, and a considerable amount of ceremony was attached to the affair, with a special train run from Chicago and a brass band on hand to greet the guests. When his system made its debut, Almon Strowger bragged that his exchanges were "girl-less, cuss-less, out-of-order-less, and wait-less." It required users to tap out the number they wanted on three keys to call other users directly. The system worked with reasonable accuracy when the subscribers operated their push buttons correctly and remembered to press the release button after a conversation was finished, but there was no provision against a subscriber being connected to a busy line. In 1896 the 'tapper' keys were replaced by a dial similar to the ones that would be used on telephones for the next 80 years.

Got to love ingenuity—one solution was to accelerate sales, and one to alleviate sales sabotage!

Tim Padgett
tim@peppergroup.com

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“The deeper problems connected with advertising come less from the unscrupulousness of our deceivers than from our pleasure in being deceived, less from the desire to seduce than from the desire to be seduced”
—Daniel J. Boorstin

“Strategy and timing are the Himalayas of marketing. Everything else is the Catskills.”
—Al Ries and Jack Trout

George's Going to Market: Focusing on the End-User

I spent a good part of my career with Michelin Tire. It’s an excellent company with an outstanding product. The company maintains a hefty 5-15% (and sometimes higher) price premium in the marketplace, and continues to lead in customer satisfaction and quality.

How do they do it? Among many factors, one key is that the company has always continued to focus on the needs of its ultimate customer.

It’s easy for an organization to lose focus on this all-important end user, and many do. With dealers, original equipment manufacturers, distributors, value-added resellers, partners, and other go-betweens, maintaining a strategic focus on better serving the needs of those people who buy your product to actually use it can be hard. But it is critical.

Michelin was founded on innovation way back in the 1880s in France when the company figured out a way to mount a bicycle tire on a wheel so that a flat tire could be changed quickly. At the time, tires were glued to a rim and flat tire changes took at least a half-day because the glue had to dry. That’s a lot of wine and cheese time, which didn’t make for good continued biking.

More recently, the huge breakthrough has been radial tires. For quite a while, Michelin was the only company selling radial tires. If you don’t remember, tires before the late 70s were typically bias-ply construction. They would get lots of flats, poor traction, and wouldn’t last very long at all. Michelin came into the picture with a completely new tire construction—a tire with much better overall performance that also lasted at least 3-5 times longer and hardly ever went flat.

Well, tire dealers and distributors didn’t all like the idea. If the tires lasted longer, it would cut their volume of tires sold. Plus, without lots of flat repairs, they’d lose another source of income. Auto manufacturers were also slow to move, and skeptical. Michelin was the only company making radial tires. Engineering and legal issues slowed the process.

Finally, other tire companies resisted strongly. A completely new construction would mean new equipment and factory configuration. They looked at their existing equipment as their #1 asset. Michelin looked at its brand as its #1 asset.

In the end, Michelin focused firmly on the end customer, and pursued a well-executed branding strategy. Rather than try to convince dealers to sell them, they went straight to consumers, trucking companies and other businesses, and created a strong pull-through demand. As a result, Michelin gained a powerful brand image of being “the best” that has continued to benefit the company today.

Now, another revolution is at hand in the tire industry. If you haven’t seen the Tweel yet, take a look at this fascinating video. Michelin is working on a tire that will again completely disrupt the industry. It has the ability to raise overall performance to a completely new level. Plus, it will never go flat because it doesn’t need air—it doesn’t even need a wheel, because it’s all part of one unit.

It will be interesting to see this play out. Valve makers and wheel makers, like buggy whip companies, may no longer be needed. Also, tire dealers may feel they’re losing another revenue source. The industry will have to change its ways. So how can this happen? The benefits are to us, the end users. With a well-executed marketing campaign that’s focused on us, we will demand it.

George Couris
george@peppergroup.com

Anna's Deal: It's Not All About You

As a natural born "people person," and someone who knows the value of a good vendor-client relationship, I am always interested to observe the interaction of others. Just recently, I was early for an appointment, and found myself listening to a meeting between a local sales rep and a potential client. The conversation went something like this:

“Heyyyy, Jim Client, thanks for your time. SO, let me tell you a little about myself, because who wouldn’t want to hear that! Here at SuperStar Media, Sales, and Everything Under the Sun, we’re all about getting you what you need before you even know you need it. Better than number one, we specialize in everything you can imagine, have 226 fully-staffed locations and are soon approaching total world domination! THAT’S right, we’re unsurpassed, unparalleled and totally unbelievable.”

Ok, maybe it’s not verbatim, but you get the picture. As I sat there, I wondered what could possibly be going through the potential client's mind. I came up with two possibilities. One, "I wonder when this guy is going to stop talking," and two, "I wonder what I should make for dinner tonight." Either way, one thing was for certain—nowhere in his mind was he ever thinking, “Here's a guy I'd really like to do business with.”

Why? Because not once during that 30 minutes of bloated speech did SuperStar stop and ask, “Who are you? How are you? And how can I help you?” Instead, he ran out of time, learned nothing about the client and left wondering why he didn't make a sale.

As our SuperStar made his way to the exit, I wondered how many other vendors make the same mistake—forgetting that their "unsurpassed" services are useless without discovering how they can be a benefit to others.

So next time you're in a meeting, remember to stop talking about yourself, and get to know the person sitting across the table from you. Find out how what you are offering might be a good fit for what they need. If you’re going to ask a person for their time, trust and money, you better be sincerely interested in what they have to say. Believe me, your open ears will go a lot further than some overused Power Point chronicling your fantastic year in sales.

Anna Jung
anna@peppergroup.com