I forgot to finish to publish the last essay I wrote last year, they were collecting dust on my google drive.
These posts are a collection of notes and summaries from the book “How Brands Grow: What marketers don’t know” by professor Byron Sharp. This work is a must read for any marketer. My personal goal when I embarked on this series of posts was to get a deeper understanding of the book and its lessons, and as I have worked through them I have not only gained that understanding, but also an idea of the areas I need to investigate more deeply in the future. Sharp is always very insightful, but I feel the need for more perspectives on many of the topics he covers. You can buy How Brands Grow here.
Why is Advertising important?
The ninth chapter of “How Brands Grow” tries to answer this question.
Just to give you an idea about the “size” of this discussion, keep in mind that 2% of world GDP is related to advertising.
Moreover, with the recent discovery in the field of psychology and neuroscience we are more aware of how the brain works and consequently the implication of advertising.
It creates and refreshes memories.
The ultimate goal of Advertising is simple to grasp, but hard to achieve, to affect the buying behaviour by enhancing and restoring purchase probabilities
By the way, it is important to avoid any misunderstanding: increasing the purchase probabilities doesn’t mean increasing market share. More often advertising protects and sustains the market share of a brand, few brands spend enough to increase it.
Advertising protects and sustains the market share of a brand, few brands spend enough to increase
And that’s why, quoting Bullmore (1999) “Advertising troubles both sociologists and financial directors: the former because they think it works, the latter because they think it does not.”
Another key aspect is related to the time horizon. Marketing does not have an instantaneous effect on sales. Nevertheless, some people still imagine marketing and its output having a direct and instant cause-effect relationship, like applying a force to a body expecting an immediate reaction as we studied in classical physics.
However It doesn’t work in that way, repeat with me:
“Marketing effects on sales are spread out in time”.
Of course, there are also exceptions to the previous statement. And these exceptions are characterised by time-related events for example: “Spring sales will finish on Saturday”.
Apart from these peculiar situations, we usually harvest the marketing effects in the future.
Continuing the reading I loved the author’s metaphor about marketing and the airplane flying. When the engines are working you don’t perceive any difference, but if the engines stop, you can feel the difference (and it is not nice).
In the previous posts, from chapter four, we evaluated how Coca-Cola purchase frequency is distributed among buyers. Half of the customers buy 1-2 cans per year, so why Coca-cola is spending so much on advertising?
Because consumers can easily forget about the product and consequently don’t make their annual purchase.
So let’s imagine that a segment of people is exposed to coke ads, and let’s suppose that we change their buying propensity from 1 chance in 300 to 2 in 300.
Mathematically it means that it is probable that they will make a purchase every 150 days rather than once every 300 days.
We doubled sales across this customer segment.
According to Byron Sharp:
“Successful advertising reaches millions of consumers who have a very low probability of buying a brand next week or months.
It refreshes and reinforces memory structures and this way the brand is more likely to be noticed in a buying situation.“
Obviously any commercial cannot build memory structure if it is not processed, we saw in one of the previous chapters how difficult it is for an ad to be remembered.
Moving on, it was definitely peculiar to think on how important memory is as a connection between the ad and brand choice. More practically how much time can pass from the moment we see the ad and when we decide to buy the product. A high frequency product like butter is bought 8 times in a year, other products once a year.
It follows that it is critical for an advertisement to work on people’s memories to influence behaviour.
Sometimes an advertisement explicitly communicates a need or a painkiller trying to persuade the consumer informing about the problem and the solution.
To do that is more effective doing that through an emotional involvement instead of an aseptic product description.
Quoting again an example from the book, think about these two different claims:
- “Goodyear tyres grip the road and reduce your stopping distance”
- “Today your child’s life may depend on your braking ability. Goodyear tyres reduce your stopping distance and keep your loved ones safe.”
Obviously the second one is more distinctive and effective because it leverages our protection instinct through fear-related emotions.
The first one is just a technical description of the tyre. The second one creates an immediate awareness about the risk and the potential loss when we are driving and how Goodyear helps us to reduce this risk.
But not all advertising carries a persuasive message, based on Mills research (Mills, 2000) sales–effective advertising does not need to persuade.
Just think about the Chrysler Super Bowl Advertisement featured with Eminem “Born of Fire”
It’s one of my favourite ads and it also won the Emmy Awards
The video doesn’t tell you to buy a Chrysler, or special technical quality of the new engines. Instead, it recalls the pride of Detroit as Motor City after a depression period, it recalls the American dream made of hard work through the struggles of life.
It doesn’t tell you to buy a car, but it’s a memorable story that you will remember when you have to think about buying your new car.
I also love Nike ads for FIFA 2002 World Cup called “Secret Tournament”, also known as “Scorpion KO” or “The Cage”. I was 13 years old and it was literally galvanizing. Again, in the series of ads they never said “buy Nike shoes” but they engaged the spectator with a challenging story.
Memorability, this creates long term memories structures that will be recalled in a buying situation, like in the supermarket or in a shopping centre. And it’s proven that a memorable ads copy is still effective in driving sales.
We discussed a lot on the importance and the effects of advertising in this post covering multiple topics connected to this aspect of Marketing.
To wrap up the gain from advertising:
- It generates sales
- Advertising copy makes the difference, some are effective, some are not, few are memorable
- You don’t need to persuade to be sales effective, memorable ads will drive sales too
- Reach is fundamental. You need to avoid memory decay. That’s why it is always better to choose continuous advertising compared to bursts with long gaps.
