Here’s the third installment of my interview with marketing expert and best-selling author, Al Ries. While I originally intended to have a fourth part, I realized that it would be best to give you his insights in one final document.
If you’ve missed parts 1 and 2, click on the following links to get the complete interview:
So, get a good cup of coffee or tea, pull up your chair and enjoy the rest of the interview!
Marsha Friedman: We’ve covered so much information, Al, and it’s all been so good. I don’t want to take up too much more of your time, but I have two questions I want to make sure I ask. First, what are your thoughts about marketing today, as compared to the seventies and eighties when we didn’t have things like the Internet, social networking, social media marketing, blogging, etc.? How has it changed marketing and do you think it’s better?
Al Ries: Well the Internet is a new medium and we don’t get very many new media. Before the Internet, the previous “new” medium was television. So over a course of history, you can see that “new” mediums took a long time to develop. First there was the printing press created by Gutenberg several centuries ago, which gave us the printed book and the periodical (which includes both newspapers and magazines). Then several hundred years later, we got radio and finally television, and now we have the Internet.
Every medium changes society. One may ask, “What is the key consequence of the Internet?” It’s the first global medium. You see, radio, television, newspapers, magazines, books…they all are basically national. We have books published in Germany, Spain and many different countries. But each of those editions is published by different people in different forms and unique to those various countries.
A book is not a global medium like the Internet. Every day of the week with the Internet we correspond with people in China and in countries around the world.
In Marshall McLuhan’s terms, “the medium is the message.” So, what is the message of the Internet? What are the social consequences of this medium? The social consequences are the homogenization of the world. Wherever you go in the world today, you see the same brands. It’s incredible. My wife and I were walking on the Great Wall of China and my wife said, “Let’s stop for a Gatorade.” Sure enough, they had Gatorade. This is China, right? Another example, I got an e-mail this morning from our associate in Vienna. He asked me, “What’s this Excelsior Jewelry being sold by Steven somebody or other in Los Angeles?” I said, “I never heard of this.” He said, “Oh, they’ve got stores around the corner of…” I think to myself, “Wait a minute!” I am closer than he is and yet HE is more familiar with it, because of the Internet.
I do a monthly article for two publications in China. They send me some questions and the latest question is, “We’re interested in the Disney brand, etc., etc.” So, again, the social consequences of the Internet, the homogenization of the globe, is that we’re becoming a monolithic society. More and more, everything around the world is the same. Eighty percent of Coca Cola’s profits are from outside the United States.
Interestingly enough, here is the really meaningful idea when it comes to marketing. To explain this, let me give you an analogy. If you lived in a small town of just one hundred people, how many stores would you find? Probably one. And, what would that store sell? Probably everything. I mean food, clothing, boots, shoes…everything people needed in general, hence the general store. Boom!
You move to a big city where there are millions of people and what do you find? You find specialty stores. Not just clothing stores, but women’s clothing stores, children’s clothing stores, men’s clothing stores, dry cleaners and super markets. The principle is this, the greater the market, the bigger the city, the more specialized the brands have to become. The implication or the consequence of the Internet, the message of the Internet is as we become more and more of a monolithic world, the brands will have to become more narrow, more focused to stand for something locally. And that’s going to be a challenge.
Everyone wants to be what I call a monolithic brand, a brand that tries to have a full line of products and services for everybody. It’s just not going to work. Why? Because as more and more companies compete in a single market, each one of those competing companies has to be more narrowly focused.
In America, for example, we got locked into Microsoft, whose initial focus was on personal computer software. If you lived in Guatemala, where there are only three million people, could you start a company to just do personal computer software and grow like a Microsoft? I don’t think so. Invariably in a big country like America, we have companies that you couldn’t possibly start in a smaller country. Why? Because the smaller the market, the broader you need to be and the bigger the market the more narrow you have to be. As we become global, the logic is, “I’m going to sell my products around the world, so I have to have a broader line, because there are a lot of different people around the world.” That’s the logic. That’s not practical marketing. If you’re going to sell globally, we have to have a narrower line.
We work with a lot of companies in smaller countries and I can tell you that a typical company in a small country is very different than a typical company in America. A company there can be in food and banking and automobiles and all sorts of stuff. That would never work in America.
In Finland, a country of five million people, they have a company whose product line is narrow. The company is Nokia and their products are sold around the world. Why? Because Finland is too small, so to build a big company in Finland, Nokia had to think globally. We don’t sometimes think globally because America is big enough that you can produce a pretty big company if you just sold to Americans. But you’d better be thinking globally, because if you don’t, somebody will come into America with their global brand (like IKEA for example) and they’ll take your business away. So globalization is the idea that has really, really been driven by the Internet.
Marsha Friedman: What a different world today. Amazing! I would be remiss, being that I am in the PR business, if I didn’t ask you about your book, The Fall of Advertising and Rise of PR. I could quote you forever from the book, because it really is an important message that businesses need to hear. Could you just comment, because I’d love to have it coming directly from you, as to why PR is so crucial in establishing a brand and planting the seed?
Al Ries: The issues here have to do with credibility. In other words, the average ad has little credibility. And there are lots of reasons for that. One of which is there is too much advertising. As a result, the average person doesn’t necessarily believe much of what he or she reads in the ads. That’s no problem if you have a strong brand. In other words, Rolex can run ads and people will believe it because they know Rolex, they know it’s famous and they know it’s one of the most powerful brands in the world. Their friends and neighbors brag when they buy one. But when they see an ad for a brand they’ve never heard of, their tendency is not to believe a single thing they read. As a matter of fact, there’s a lot of research that says most people won’t even look at an ad for a brand that they’ve never heard of on the basis that, “If I’ve never heard of it, it can’t be any good.”
Marsha Friedman: That makes a lot of sense.
Al Ries: So advertising, more and more, is not good for the new brands. What’s good for new brands? PR. You see, in PR you’re not speaking for the brand, it’s the New York Times or the Wall Street Journal, or CBS, NBC or ABC who says it’s terrific. So the third-party endorsement through PR is the way to launch a new brand. Now that goes exactly against the thinking of management in America. Anytime anybody says, “Let’s launch a new brand,” management says, “We can’t afford to spend $20 or $30 million on an advertising campaign.” And we will say, “You’re right. You shouldn’t be doing that anyhow. You should be launching with PR.” Our philosophy is PR first and advertising second. You only use advertising after the brand has become established.
I’m not saying that established brands shouldn’t do PR; sure they should. But believe me, there is such an opportunity in the PR business to launch brands. As you probably know from your own experience, in meetings to launch a brand—and I’ve been in many of those and looked around—there are no PR people. The ad agency is there, the marketing manager is there, the sales manager is there and I ask, “Where are the PR people?”
So the PR business has a long way to go. First, they’ve got to get in the room. They’ve got to find a way to break down the door to get in the room before the brand is launched. That’s an issue too, but the philosophy I recommend is very powerful: PR first, advertising second.
And the other implication of this is the PR people need to get involved in the strategy of the brand. That’s the biggest single hang up, because traditionally it’s the advertising agency that works with the client to develop the marketing strategy—the “ultimate driving machine” words—and not the PR agency. But, the PR agency should, in a sense, take over the brand launching part of it and work on how to verbalize and visualize the brand. I think more PR people should be interested in reading our books than advertising or marketing people because some very major companies could buy into the concept of PR first and advertising second.
It would create enormous business for PRs, but more importantly it would make the function more important for the company. And nothing is as powerful in a company today, as a successful launch of a new brand. A new brand can double their business. The opportunity for a company’s expansion in many ways lies in the development of new brands.
A number of years ago when Apple came out, Richard Edelman, President and CEO of the world’s largest independent public relations firm, used to make speeches on this subject and Edelman’s business has gone through the roof. I can’t believe how large they’ve grown in the last ten years. There is an enormous potential in the PR business if you just do exactly what I’m talking about: establish the idea that the PR people should be the ones that are the outside consultants launching a new brand and not the advertising agencies.
Marsha Friedman: To your point about no PR people in that Board meeting discussing a brand launch; my experience is that there’s often a big misunderstanding by management as to the actual function of PR, and for that reason, gets overlooked for its importance and value to the company.
Al Ries: Yes, but this is not a one-sided thing. I think many in the PR industry don’t want to be responsible for the success or failure of a brand so they don’t really want to step out and say, “Hey, you should let us handle it.” They would sometimes rather say, “Send us the ads and we’ll publicize the ads.” That’s easy way out, right?
Marsha Friedman: Yes, that’s true. I’d like to ask you something else that just came to mind based on everything you just said about launching a brand with PR. Since you are engaging the public, then what the brand stands for may change, based on the response from the people. I was thinking about a Clear Channel radio station here in the Tampa Bay area that had a caller who said their Christian radio station was “life changing radio.” Ever since, Clear Channel grabbed that and now it’s their slogan. So, if PR is used effectively, the public may tell you how best to position your product to speak to them?
Al Ries: Exactly. That’s exactly it. When you launch a brand with PR, the idea that you’re going to live with forever isn’t necessarily in the PR release. It’s usually in what the magazine or the newspapers or the consumers wind up saying about the brand. So always keep your ear to the ground and when you hear something that’s good, you jump on it. But that’s the thing that companies don’t like, because they want control of the message. And, when you launch a brand with PR, in a way, you leave control of the message in the hands of the media and public, and corporations don’t like that.
We once worked for a company, that is out of business now, but their product was prepared foods. They hired us as consultants after they were in business a couple of years and after we looked over their material, we noticed there was a headline in one of the big magazines that said, “The Joy of Not Cooking.” And, we said, “Terrific, here’s what we want you to do. You see that sign out there with your company name? Well underneath that we want you to put a big sign that says “The Joy of Not Cooking.” It’s a consumer oriented idea and those words were the “ultimate driving machine” for them.
Do you think we were able to sell that idea? No. Instead they wanted to talk about the opposite: the joy of cooking and the experience of their 12 chefs.
Marsha Friedman: And, that gets to your point about the brilliant marketer being the one who is able to put himself in the mind of the prospective customer.
Al Ries: Yes, it’s all in the mind of the consumer. You are taking a chance when you launch a PR campaign as you can’t control the message. From many companies’ point of view, they hate that part. They want total control of the message and they want to hammer an idea to the consumer. I mean, look at some of the messages out there. I don’t know if you’ve seen Chevrolet’s latest advertising message: Chevy runs deep.
Marsha Friedman: Okay, I have no idea what that means.
Al Ries: Well, what you see is an old fashioned photo and typography. In a sense, what they are trying to say is, “Look at the heritage of the Chevrolet brand; it’s been around forever.”
Marsha Friedman: I see…
Al Ries: Chevy runs deep. Again, in our terminology you’ve got to bring the message down to earth. If we’re selling tractors, “runs deep” is great. But not SUV’s or cars. You don’t want to paint a picture that the darn thing is in the ditch.
Marsha Friedman: Great point. Al, I want to thank you so much for taking the time to share with us your nuggets of wisdom, so that our readers can be enriched and, hopefully, their businesses grow.
Al Ries: Thank you for calling Marsha. It’s been nice talking to you and answering your questions.
~~~~~~~~~~ End of Part 3 ~~~~~~~~~~~~~~
Profound insight from Al, once again. I hope the information shared throughout these three segments has given you some nuggets of marketing wisdom and is helpful to the success of your business.