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Friday, 11 November 2011

Very droll: another blinding glimpse of the obvious lurches out of the intellectual undergrowth - plus Ocado's marketing madness

Friends accuse me of mock-modesty when I say that any success I have had has little to do with my abilities but is almost entirely due to the sloth of many if not most people in the marketing game.

But I am absolutely serious and bring in evidence three instructive examples.

First, the advertisement shown here, which is about 90 years old. It is the work of Claude Hopkins, and a simple demonstration of what marketing is all about - besides illustrating one or two tricks that repay study.

Second, a relatively new online publication called Social Media Examiner which caters to fools in thrall to the latest silver bullet.

And third, why a company called Ocado that does almost everything right is not just shooting itself in the foot but enthusiastically cutting its legs off every day.

The Pepsodent ad shows how to acquire customers in any business. Offer a benefit, paint a word picture and give something away free that will capture customers. This is what you have to do on the internet, for example, though surprisingly few seem to know it.

The ad also forces retail distribution in a way most large firms today have never heard of. It sends retailers lots of people interested in Pepsodent.

The story of how Pepsodent became the leading toothpaste all those years ago despite being no better than any of its competitors is told in The Man Who Sold America. Please don't ask me about that because you should know of it and its subject already. Just read it.

Social Media Examiner is the brainchild of Michael Stelzner and good for him. His aim, I guess, is to enlighten people who a) think social media are the answer to maiden’s prayer and b) don't realise there is nothing new about how to succeed in these media. They are probably also under the illusion that a slogan is advertising and re-branding will save their witless little arses.

The latest Social Media Examiner offers a report called 4 Steps to Selling With Social Media. This tells you what Claude Hopkins knew 90 years ago. 1. Find a prospect. 2. Keep talking to them till they buy. 3. Keep them as long as you can. 4. Measure everything to see how you're doing.

Marketers who don't understand this should go and get a job growing turnips. If they did we would have lots more turnips, marketing departments would shrink by about two thirds and average return on marketing investment would double.


I have been studying Ocado, a very good home delivery service, for years. They don't understand one of the most important things in the process above, with disastrous consequences. I have manfully refrained from comment because I think they should pay me for this, but I can't keep quiet any longer.

Ocado are very good at finding prospects and making them buy. They do this by offering discounts. New customers go onto the database and they communicate with them regularly.

So far so good. But you know what happens next? They keep offering them discounts. Why? If the service is good (which it is) they don’t need to. They are training their customers not to buy except with a discount.

As my friend the late Professor Andrew Ehrenberg in the PIMS study run with the Ogilvy Centre for Research pointed out well over 25 years ago, this kills profits.

Whoever is responsible for this folly should have their brains surgically replaced with something more useful. Fish oil, maybe.

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