What can we say about marketing that hasn’t been said many times before?
Two developments have changed marketing forever. One is the arrival of the internet. The second is the rise of global branding. Both of these developments have contributed to the revolutionary changes that have taken place in marketing since the turn of the century.
1. PR is more important than advertising
In the past, almost every new brand was launched with a big advertising campaign. In today’s media environment, that doesn’t work anymore.
Advertising is expensive and not very credible, especially when used on behalf of a new brand. That’s why many of the most successful new brands were launched with PR.
Consider the recent presidential election. Hillary Clinton’s campaign spent almost twice as much on advertising as Donald Trump’s campaign: $1,184 million for Clinton; $616 million for Trump. Yet Trump won the majority of the electoral votes: 306 for Trump versus 232 for Clinton.
It’s a different story when you measure the PR received by the two candidates. By most counts, Trump received almost three times as much publicity as did Clinton.
Why? Because Trump was “controversial” and Clinton was not. Controversy makes news, and news builds brands.
That’s one of the big differences between PR and advertising. A PR program needs to be controversial, but that doesn’t work in advertising. Consumers are turned off by advertising that attacks the competition.
But they don’t blame the brand if a story in the media does the same thing.
2. The category is more important than the brand
Marketing is often called “brand building.” The emphasis is on creating a better-known, more-authoritative brand.
But what role do brands play in the marketing process? Consumers can’t buy brands. Consumers buy products with brand names attached.
Consider the analogy between marketing and warfare. A country launches a military campaign to conquer a territory. A company launches a marketing campaign to conquer a category.
Soldiers, tanks and aircraft are the tools of a military campaign. But they are not the objective.
3. The name is more important than the strategy
It probably didn’t surprise you that RadioShack went bankrupt. (For the second time.)
What is surprising is that the executives who ran the company thought it could be successful using the RadioShack name. When was the last time you bought a radio without an automobile attached?
4. The visual is more important than the verbal
For 65 years in a row, Heineken was the No. 1 imported beer in America. Then Corona arrived with a lime on top of the bottle.
Today, Corona outsells Heineken in the American market by 120%. That’s the power of a visual.
But not just any visual. After all, advertising and other forms of marketing are loaded with visual images. What a brand needs is a visual that reinforces its verbal positioning concept.
The “position,” a verbal concept, is the nail. The tool that hammers the positioning nail into consumers’ minds is the visual hammer.
While the objective of a marketing program is to put a word or a verbal concept into consumers’ minds, the best way to do that is not with words at all. It’s with a visual that has emotional appeal.
5. Multiple brands are more important than single brands
The era of the single-brand company is over. In the future, global companies will have multiple brands. Companies like Apple, Procter & Gamble, Coca-Cola, Unilever, Nestlé and many others.
Consider two examples of famous single-brand companies from the past. General Electric and IBM.
In the past decade, from 2006 to 2015, revenues at General Electric have declined 28% and revenues at IBM have declined 19%.
The actual declines are even worse. In the past decade, inflation has caused the value of the dollar to decline by 16%.
Take the internet. Almost every major company in the world has launched a website using its existing brand name. Have any of these websites become enormously successful?
Of course not.
To develop a successful website, you need a new brand name. Take Walmart, which launched Walmart.com in the year 2000. Today, more than 16 years later, Walmart.com accounts for less than 3% of Walmart’s total sales.
And, recently, the company admitted its website strategy was a mistake by buying Jet.com, an internet site that was launched in 2014, for $3.3 billion.