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Why do advertisers spend so much money talking to people who have very little to spend? Because they like talking to themselves – often defined as the first sign of madness

Guest post by: Drayton Bird

Article Overview: For marketing to succeed, who you talk to is far more important than what you say. Yet marketers tend to spend much of their time talking – often incomprehensibly - not to people with money but to those without.

Why do advertisers spend so much money talking to people who have very little to spend? Because they like talking to themselves – often defined as the first sign of madness

Until a few years ago I owned a couple of houses set between two towns on Normand, both about the same size.

One - St Pierre-sur-Dives - has great character, with splendid buildings including a twelfth century hall where they hold antique markets on the first Sunday of the month. The other, some fifteen miles away - Vimoutiers - is a very dull contrast.

The differences lie not in the people, who are just as friendly, or the settings, which are beautiful, but in the fact that in 1944 the U.S. Air Force accidentally unloaded a lot of bombs on Vimoutiers, flattening the centre. To make up for this little accident they paid to re-build much of the town during the late '40's in the awful style of architecture then in fashion.

You might say the difference between the two towns derives from what we call 'bad targeting'. Even the most compelling message - and bombs are very compelling - is a waste (in this case a disaster) if it reaches the wrong people.

This thought pre-occupied several correspondents in the letters page of the New York Times a while ago. They were discussing an odd but common practice: why do marketers spend so much on people who don't have much money, rather than people who do?

To be precise, why are they so obsessed with targeting young people, when increasingly old people have most of the money? I recall that in Marketing, a U.K. magazine I used to write for, someone revealed that 86% of over 50's do not relate to the messages advertisers produce.

One ingenious argument is that advertisers seek to catch people while they are forming their brand loyalties, rather than when they have become set in their ways. It suggests that old people don't like trying new things, so why bother with them?

This is complete balderdash, as anyone who has studied the real world knows. Old codgers not only have more money; they have more time. Time to try new things. A surprisingly high number got onto the Internet fairly early. Maybe this is because (as I fondly hope) old people are not as old as they used to be - reasonable if you look at life expectancy, which has risen greatly in most countries.

When I reached forty I was delighted to learn there was some truth in the maxim that life begins then. With every decade that has passed I have discovered new pleasures. I certainly have not stopped buying, and I may be more willing to try new ideas than ever. As you age, you realise you have less time left - but happily, you have more money. I suspect a lot of other older people are in the same happy boat.

A chief benefit of direct marketing is that - as David Ogilvy remarked - 'general advertisers can only guess: direct marketers know'. So the results of a mailing we conducted for a Scottish bank some years ago were particularly fascinating to me.

They had never written to their oldest customers, thinking they weren't worth bothering with - why worry them if they are not worrying you? But we suspected these people might be more willing to buy than they imagined. We softened them up with a one-page letter, which in effect said 'Thank you for being a customer'.

Research results exceeded my most optimistic expectations: 92% remembered that letter a month later. Recall is very well - agencies love talking about it - but what counts is, will people buy? Again, our most sanguine expectations were exceeded: when these people were subsequently offered various services, they bought in gratifyingly large numbers. That is what you call building measurable brand loyalty, though now the fashionable fad is CRM.

A lot of bilge is talked about brand loyalty. The 100% brand loyal customer is about as rare as a vegetarian crocodile. As that wiser man Professor Andrew Ehrenberg of the South Bank Business School pointed out for years, people choose from a portfolio of brands.

The truth is that ad agencies are full of young people, creating ideas to show off and win praise (and awards) from other young bloods. As David Ogilvy also noted, they squander their talents "skidding about helplessly on the slippery surface of irrelevant creative brilliance".

Turn on your TV any night. You'll see.

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Article Tags: advertisers, antique markets, balderdash, bombs, brand loyalties, century hall, correspondents, disaster, fashion, marketers, much money, nbsp, new york times, splendid buildings, st pierre sur dives, style of architecture, twelfth century, u s air, u s air force



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