This I Know

Marketing Lessons from Under the Influence

Terry O'Reilly

• Publisher: Chicago Review Press
• Year: 2018
• Print ISBN: 9781641600149
• eBook ISBN: 9781641600170
• Edition: 1
• Topic: Business
• Subtopic: Advertising
• Index: Business

Terry O'Reilly, host of the popular radio show Under the Influence, provides the best stories about smart marketing for small business. In Terry's gifted presentation,  This I Know is more than applied business techniques. It offers a unique view of contemporary life through the lens of advertising. Skillfully revealing the machinations behind the marketing curtains, O'Reilly explains how small business can harness the tricks of the trade that the biggest corporations use to create their own marketing buzz. 

Chapter One

SLUDGE OR GRAVY

What Business Are You Really In?

What business are you really in? Don’t answer that question too quickly. Most people get it wrong. Yet it’s the most important marketing question you can ask yourself. Until you can answer it correctly, your marketing will always lack focus. A truism of business is that what you sell and what people buy are almost always two different things. Companies look to sell products, and customers look to buy solutions. While seemingly related, the definitions of each can be miles apart.

For example, Molson isn’t in the beer business. Even though Molson’s plants are designed to manufacture beer and every Molson delivery truck you see is full of beer cases, Molson isn’t in the beer business. It’s in the party business.

Look at almost any Molson beer commercial. It’s all about having fun, being in groups, flirting, laughing and socializing. That is what the majority of Molson beer fans are really buying into when they put their money down. Molson is a savvy marketer and it knows the solution it offers is social lubrication. That presents a delicate communication task, because alcohol marketing is heavily regulated in this country. So the partying scenes are tightly controlled. The number of beers in a scene must equal no more than the number of people in said scene. Five people in a shot, five beers max. No one holding a beer can be involved in an activity requiring skill—like waterskiing or chainsaw carving. No one can appear to be underage. The activity of the participants can’t be “over exuberant.” I once had a beer commercial turned down by regulators because one of the actors toasted above shoulder level. The charge: too exuberant. The advertising can’t suggest beer promotes sex. (I know, I know. It’s the most elastic rule of the bunch). But say what you will, Molson knows what business it’s in.

Michelin is not in the tire business. It’s in the safety business. Its purpose is to offer the utmost tire safety for automobiles. Michelin once had the best tire tagline of all time. The company’s TV ads showed a baby strapped into a radial, with the line “Because so much is riding on your tires.” That’s the business Michelin is in. Not vulcanized rubber. Safety. So if it just sold tires, it was in trouble. But if it sold safety, it was golden. (Why Michelin abandoned that line, I will never know.)

Häagen-Dazs isn’t in the ice cream business, it’s in the sensual pleasure business. Whitewater rafting companies aren’t in the personal transportation business. They are in the personal transformation business. Starbucks isn’t in the coffee business. It’s in the coffee theatre business, with baristas, elaborate java machinery and five-word mocha-choco-lotta coffee names.

Apple isn’t in the computer business. It’s in the personal empowerment business. If you want to understand Apple’s massive success, just draw a straight line back to late 1983. To Super Bowl XVIII. To late in the third quarter. To a TV commercial called 1984. (See Fig. 2.)

Within the advertising business, it is arguably the most famous TV commercial in history (google it). This single advertisement positioned Apple for all time in the minds of the buying public. It showed a bleak image of George Orwell’s 1984 future, where people shuffle in drab uniforms and listen to the hypnotic ranting of Big Brother on a gigantic screen. But meanwhile, we see dramatic cuts of a female athlete, dressed in white and red, holding an Olympic-sized hammer, being pursued by a squad of futuristic police. She runs down a long tunnel into the gathering, stops, swings the hammer and lets it go with a scream—smashing the gigantic screen, to the amazement of the catatonic crowd. The message from Apple: “On January 24th, Apple Computer will introduce Macintosh. And you’ll see why 1984 won’t be like 1984.” Translation: We’re going to take the computing power that IBM has hoarded all these years and give it to you.

That single message—or contemporized variations of it, echoed ever since by everything Apple does and everything Steve Jobs has said—is why so many people buy so many Apple products. To put a finer point on it, you can google a photograph of Steve Jobs at IBM’s head office, standing under its massive logo, flipping the bird. People loved that rebel stance. When Apple announces a new product, people line up overnight to be the first to get their hands on it. No one does that for Dell. People are drawn to Apple’s promise of personal empowerment on a very deep level, topped with a little seasoning of “us versus them.” That is what Apple sells. There are more powerful computers out there, and certainly cheaper ones, yet Apple has become the most valuable company in the world after Exxon. It accomplished this by completely understanding what business it is in.

Nike isn’t in the shoe business. It is in the motivation business. The mantra “Just Do It” has been called the last great slogan of our time. While it may have motivated millions of people to step up and enjoy life, it was actually inspired by someone’s death. Dan Wieden, co-founder of advertising agency Wieden + Kennedy, located in Portland, Oregon, coined the slogan. He remembered watching a news report on the execution of spree-killer Gary Gilmore in 1977. Gilmore, who had grown up in Portland, was being executed in Utah by firing squad. His official last words to the warden were “Let’s do it.” Wieden was struck by the impact of that line. He thought it remarkable that Gilmore could face that much uncertainty and just push through it. It stayed with Wieden, and when he needed to come up with a tagline to tie eight different TV commercials together for his agency’s first presentation to Nike, he remembered Gilmore’s words. He simply changed one word and “Just Do It” was born. The rest is marketing history.

The power of that line cannot be understated. At first glance, it says, If you have a body, you’re an athlete. But a quick frisk reveals something more profound. That phrase is the answer to so many of life’s bigger questions. Should I tell the boss my idea? Should I quit this horrible job? Should I start my own business? Should I pop the big question?

The majority of the people who wear Nike sneakers don’t work out. That should tell you everything. “Just Do It” is a line that ignites millions of dreams, only a small percentage of which are exercise-related. Nike knows what people are buying. It’s not shoes. It’s motivation.

Conjure up all the commercials you can for Molson, Apple and Nike. Nearly all Molson ads show people happy and partying. After the 1984 TV commercial, virtually all Apple commercials show an individual achieving something on a computer. Every single Nike ad you’ve ever seen shows pros and amateurs reaching for a dream. Good Molson ads don’t tell you how the beer is made. Apple doesn’t analyze gigabits. Nike rarely discusses sneakers.

You have to know what business you’re in.

I once interviewed Playboy founder Hugh Hefner. I asked him this: If you were to stop wearing pyjamas to work and ceased dating twins, would it affect your business? He didn’t hesitate. His immediate answer was yes. You’ve got to hand it to old Hef; he knew what business he was in. In order to keep the entire grotto-filled enterprise afloat, he had to sell the lifestyle. Men weren’t buying a magazine; they were buying the fantasy of living the Playboy life.

If you are a company big enough to hire an advertising agency, then a smart one will help you uncover what business you are really in. But if you can’t afford an agency, you have to do the homework on your own. Believe it or not, answering this question is not as easy as it appears. It requires sober objectivity, one of the most important things an ad agency can offer a client.

Agencies need to strive for objectivity because in order to appeal to a customer, you have to think like a customer. Not like a company. Most companies fall in love with their product. The passion you feel for your company is good, but that passion can be fuelled by your immersion in how your product is created—which, if you are marketing that product, is bad. You are lost in the weeds. Have you ever asked an Internet installer a question and had to stand through a thesis on routers and megabit-per-second download rates when all you really wanted to know was whether you could download an HD movie?

That’s what I mean.

Smart marketers know when their nose is too close to the glass and their breath is fogging up the view. You have to develop the ability to leave your office and look back in through the windows. Ruthless objectivity is the key. Customers are drawn to a brand—be it a product or a service—for many reasons. But the most important, overriding reason is how it makes them feel. Price, location, colour and so on all rank well below this single criterion.

Remember the cola wars in the eighties? Remember the Pepsi Challenge commercials? We all sat at home and watched real people take the challenge of sipping two hidden colas, and choosing one, which, when revealed, was Pepsi. Coke’s management all sat at home, too, watching the same commercials every night, and it made them nuts. Here’s the important thing to know: Coke had an ocean of market share over Pepsi. It couldn’t even see Pepsi in its rear-view mirror. But the sight of those commercials playing out every single night made Coke executives crazy. So what did they do? Coke actually changed its formula. If you remember, the reaction to that was so negative, so swift and so overwhelming, Coke brought back its original formula only seventy-seven days later. Can you imagine what that cost Coca-Cola? Untold millions. The company not only changed its packaging, and spent millions with Bill Cosby (!) marketing New Coke, it changed its entire manufacturing process.

But I maintain Coke should have been really happy about that. It proved how much people loved the brand. If they didn’t, that change would have passed like a ship in the night. As one journalist noted, it just happened to be the most expensive focus group in history. Follow this math with me: In hidden taste tests, Pepsi beats Coke slightly. In taste tests where respondents can see both brands, Coke beats Pepsi decisively. Interesting, isn’t it? Nothing has fundamentally changed in that scenario. But get this: in another taste test, where Coke was pitted against a hidden cola, in other words, where people could see Coke but not the other brand, Coke beat that other brand 99 to 1. Guess what that other brand was?

Coke.

Coke clobbered Coke.

Let’s analyze what happened there. When people saw the branding information—the familiar Coke bottle and logo—they made an automatic assumption. Coke was vastly superior to whatever that other cola was. That’s how powerful branding is. It can make a product taste better than itself in your mind. So how does Coke do this? With a century of smart marketing. Coke knows what business it is in.

Look at the one thing Coke sells in all its advertising: happiness. It’s only sugared water in a bottle. Yet Coke is one of the most valuable corporations in the world. It has attached happiness to its product. Think all the way back to the famous I’d Like to Buy the World a Coke commercial in 1971.

Happiness.

That commercial was inspired by an interesting moment. When adman Bill Backer was flying over to London, England, to record a new jingle for Coke, his plane had to land in Ireland since Heathrow was fogged in. Pan Am didn’t want to bus the passengers to a major hotel in a large city forty minutes away, because the airline wanted everyone nearby and ready to board on short notice in case the fog lifted. Instead, it sent them to a small, local motel. But it didn’t have enough vacancies to accommodate two hundred passengers, so everyone was asked to double up. Having to share a room with a stranger put the passengers in an even worse mood. Some refused and curled up to sleep in the corner of the lobby. Others grouped themselves by nationality or sex.

The next day the passengers weren’t allowed to leave the airport. They could only shop in the duty-free store, eat, snack and feel sorry for themselves. As Backer says, they had been placed on permanent standby. By midmorning, all the duty-free shopping that could be done was done. The second hand on the airport clock seemed to move once a minute. Passengers began collecting in small groups in the coffee shop. Slowly, the mood started to lift as people began having conversations. The common icebreaker was a bottle of Coke. That scenario was being repeated all over the restaurant—people who spoke different languages, from different countries, forced together by circumstance were enjoying each other’s company over a Coke. As Backer watched this unfold, he realized that Coke wasn’t just a liquid refreshment, it was a tiny bit of commonality. He scribbled, “I’d like to buy the world a Coke, and keep it company” onto a napkin, and stuffed it into his pocket.

When he eventually got to the recording session in London, Backer pulled the napkin out of his pocket, and that line he’d scribbled down became the heart not only of the jingle but also of one of the most famous TV commercials of all time. The original tune was sung by the Hillside Singers, an ad hoc group put together by jingle producer Al Ham. When the jingle became a sensation, Ham issued it as a single (with a slight tweak from “I’d like to buy the world a Coke” to “I’d like to teach the world to sing”). The New Seekers, who had originally been approached, didn’t think much of the jingle when they first heard it, considering it too syrupy and simple (“…apple trees and honey bees and snow white turtle doves”). But when the Hillside Singers had a hit with it, the group decided to release its own version. The melody was sticky, and the song contained a profound message of peace and harmony at a time when America was still wading through the swamps of Vietnam. Never underestimate the power of the right message at the right time. It sold twelve million records.

Don’t you think, in this day and age, that a competitive company could analyze a bottle of Coke and figure out its secret formula? Then manufacture a product that tasted just like Coke? The answer is yes. It’s been done many times, but those companies don’t succeed. Why is that? Because people aren’t buying sugared water. They’re buying Coke’s powerful branding and its consistent promise of happiness. Let’s follow that through to its logical conclusion. Why does Coke succeed around the world, across borders, with many different cultures, in spite of hundreds of competitors? Answer: because happiness is a universal emotional desire, and Coke has been masterful at linking its product to that emotion. Coke knows what business it’s in.

Molson makes people feel like partying. Apple makes people feel they can compete with corporations. Nike makes people feel they can achieve any goal. Hugh Hefner makes men feel they, too, could date twins, if only they had more time on their hands.

So when you look at your business, you have to divorce yourself from your product, from the manufacturing process, from the sugared water, the hops and the air soles. You have to think like a customer. To do that, you have to quietly observe what customers are really buying from you. They will tell you, but you have to listen carefully. I have always believed the best marketers are the best listeners. I once had a business partner who would ask a client a question about their company, then proceed to answer it himself. He would then look to the client for a nod in agreement. But two monologues don’t make a dialogue.

When I ask a client a question, sometimes I already know the answer, sometimes I don’t. But I always want to hear the exact words the client chooses in their response. That answer is like a suitcase; it’s packed with insights and clues and tiny epiphanies. Many clients can’t articulate what they want to say about themselves or their product in a short, concise way. So you have to read between the lines. It’s the same with the buying public. Ad legend David Ogilvy once said that consumers don’t know what they feel, don’t say what they know, and don’t do what they say. But with Presbyterian patience, you will see and hear the information you need. You have to ask the right questions that prompt the revealing answers. The clues to their true desires—what they really want to buy from you—are in their adjectives and their adverbs.

Customers are most forthcoming during two occasions: when they are knocking on your door, and after the task is completed or the product is purchased. For example, at Pirate, we produced the audio for radio and television commercials. Our biggest customers were the creative departments in advertising agencies. Copywriters and art directors would bring their radio scripts or film to us, and we would add the sound effects—every footstep, every bird chirp—compose the music and direct the voiceovers. We offered audio directors, music composers, sound engineers and line producers. In marketing Pirate to adv...

Table of contents

• Cover
• Title Page
• Copyright
• Dedication
• Contents
• Foreword
• Introduction
• Chapter One: Sludge or Gravy—What Business Are You Really In?
• Chapter Two: Praying to the God of Otis—Perfecting Your Elevator Pitch
• Chapter Three: Strategy—It Tastes Awful. And It Works
• Chapter Four: Bieber in a Blender—If They Feel, They Believe
• Chapter Five: Steinways and Autopsies—Tell Me a Story
• Chapter Six: Finding Your Inner Broadway—What Is Your Greatest Area of Opportunity?
• Chapter Seven: Start with the End—How to Make a Persuasive Presentation
• Chapter Eight: Purple Chickens—The Joy of Counterintuitive Thinking
• Chapter Nine: Fishing for Marilyn—Timing Is Everything
• Chapter Ten: Nudge, Nudge (Wink, Wink)—The Power of Gentle Taps
• Chapter Eleven: What Time Is the Three O’clock Parade?—Why Customer Service Is Marketing
• Chapter Twelve: Going the Extra Inch—The Value of the Small Gesture
• Chapter Thirteen: Reid’s Law—The Need for Tension
• Chapter Fourteen: Keeping Your Shish on Your Kebab—Maintaining Your Personal Brand
• Chapter Fifteen: This I Know
• Afterword
• Notes
• Acknowledgements
• Image Credits
• About the Author