The Money Pit

5 02 2012

Today is the most hallowed of days in the field of Marketing. And, yes, I fully intended to use uppercase. It is a discipline. It is an industry. It is a lifestyle.

And today is the Super Bowl of Marketing.

Unfortunately, it could also be called a sad remake of the Tom Hanks/Shelley Long classic, “The Money Pit.”

With ads running $3.5 million for a 30-second spot, this is the day in which Marketers spend with drunken, reckless abandon. Spitting into the wind. Blowing and going.

Never mind that the 2000 Super Bowl was the one in which nearly a dozen dotcom companies blew through all of their venture capital. No, the tradition has continued among old-school companies, all intent on showing us how creative they are. Unfortunately, there is a negatively elite group of companies that have wasted their money.

Herein lies the problem: Advertising expenditures are not necessarily positively correlated with sales and/or market share (which, by the way, are two very different constructs). While prevailing “wisdom” may dictate that companies must advertise in order to prosper, there is very little proof that doing so actually helps matters.

Take Budweiser, for example. It has promoted with great emotional fanfare (those Clydesdales can sure bring a tear, right?), yet their market share has diminished. They have also seen their existing customer base shift from being Budweiser fans to Bud Light. The cost of cannibalization has been great. Budweiser (now owned by Belgium’s InBev) has spent a quarter of a billion dollars in the last decade to move its declining custoemr base around.

Sheer genius, right?

Also related to the problem is that companies and their ad agencies pull out all the creative stops, but without thought toward actually producing sales. In other words, there may be memorable, even award-winning, ads, but if they do not result in increased sales, it’s just money misspent.

Maybe Marketers assume we simply want to be entertained during the Super Bowl, and that these funny or heart-wrenching ads are merely the TV equivalent of presenteeism. After all, if Bud steps aside, Miller/Coors could (OK, probably would) step in. Which is to say that many of the ads are simply placeholders.

Essentially, the network broadcasting the game is the primary beneficiary of this advertising largesse. Viewers may or may not be entertained, and likely will not be motivated to go shopping. Companies feel obligated to attend the party in our living rooms, but the entry fee is so high as to limit attendance to only the largest companies (or, as we saw in 2000, those with rich investors). In the end, though, I am not sure that anyone really cares.

It’s kind of like buying an old house, only to find out that fixing it up and maintaining is a bottomless hole screaming for money. And there is no ladder out.

Someone pass me the nachos, please.

Dr “Ad Verse Reaction” Gerlich




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