PROMO: What’s wrong with promotion?
ZYMAN: It is not grounded in strategy. The biggest problem in promotion is that it’s grounded in the event – in the trinket, the Beanie Baby – not in figuring out what you’re trying to do and how to do it. Am I trying to rent volume? That’s what most promotions do. Or am I trying to find something consistent with the essence of the brand? To do that, do you have a clear understanding of the brand essence? [I’m on] a holy war to bring discipline and recognition to the function of marketing, and promotions is a critical part of the whole thing.
PROMO: Promotion has been more disciplined than advertising for a long time, and much more accountable to results and sales than other marketing disciplines.
ZYMAN: But it’s hit and miss in many cases. Many promotions start like this: I’m sitting in my office at Coke and I get a call from someone who says, “I have exclusive rights to the traveling exhibition of the Titanic, and I have a great promotion to give away replicas of the Titanic.” I have an e-mail that just came from a guy that says, “I have a promotion device grounded on the Pearl Harbor movie and I think it will be spectacular for Coke.” Where is the strategy for this?
[In the mid-80s], Michael Jackson decided to sell his rights to somebody and came to see us at Coke. What was I going to do with Michael Jackson? I couldn’t reconcile it. He ended up selling his rights to Pepsi.
Look at Beanie Babies. Was McDonald’s sitting around saying, “I have to find a way to connect with moms and kids at the same time and I want to go look for a promotion?” No. Beanie Babies existed on their own. They went searching for someone that was willing to accept the product as a property.
PROMO: But that’s looking at it from the salesman’s perspective. It’s up to the brand manager or promotion manager to say whether the trinket is on strategy.
ZYMAN: Right. I was in Cairo a few years ago and saw a promotion that gave away bicycles. I asked, “Why did it work?” My guy said, “Because people love bicycles.” And I asked, “Why did you decide to do it the way you did it?” He didn’t know.
I started promotions big-time at Coke when I was there the first time [from 1978 to ’88] because my objective was to have people open bottles. I didn’t care if they drank it – once they opened it, I had a sale. I was looking all the time for devices that would help me sell more product.
In my later years [1993 to ’98], I looked for things that would go to the core essence of the brand. I wanted things that would talk about the greatness of the can and the taste of the product – that would actually embody the strategy. How many companies sit around and actually say, “What am I really trying to do?”
The first element is destination: What is your core business?
PROMO: That gives people a way to think from the beginning, so when the salesman calls with a replica of the Titanic, you know whether it fits the strategy.
ZYMAN: Absolutely right. Remember one thing: Routine is the largest enemy of growth and creativity. It’s great to have routine in your personal life, but in business and creativity, routines are bad because you don’t question what you do. Look at what happened at the Four A’s: Maurice Levy stood up and said, “We screwed up.” They know now that creativity is not the way to go, they have to sell product.
PROMO: When that happened, a lot of people in promotions industry said, “Duh. That’s what we’ve been doing all along.” Promotions has been a results-driven business, partly because it’s measurable. It has become more strategic the last several years. Do you agree?
ZYMAN: (pause) I think it has become partially more strategic. I don’t think it has become totally strategic.
PROMO: Where do you think it needs to go?
ZYMAN: To 100 percent strategic. We need to get to the point where we recognize the power of promotion. Fundamentally you have a product, which eventually becomes a by-product. Promotions are supposed to add value. You don’t want to end up like Pearle Vision Centers, which started with “buy one, get one free” which got them all the way to the top till you get to “pay nothing, get two.” There was never any added value to the brand.
I pick up the Sunday paper and see 150 lbs. of promotions and coupons and I’m still seeing the same old stuff. What I want to know is, if I have the Olympics or NASCAR as a property, how do I put together a promo that actually says to consumers, “If you buy this thing, you’re going to get something that’s going to link to the brand for a longer period of time.”
Am I seeing a positive trend to more strategic stuff? Yes. The problem is not in the promotions industry. The problem is in the advertising and marketing industry.
PROMO: A lot of our readers would agree with you, and say that that problem is starting to go away as clients hold their ad agencies more accountable in the same way they’ve been holding their promotions agencies accountable. At the same time, promotion – especially experiential marketing – has become much more image-oriented.
ZYMAN: Here’s one of the greatest promotions I’ve ever seen. In the late ’70s, Barclay gave away a carton of cigarettes to everyone who called their 800 number. It’s what I call ‘conscious trial,’ because consumers actually had to go through an activity – we didn’t have speed dialing then – and people spent all night dialing to get through. When you got that carton of cigarettes, you wanted it. You wanted to smoke those cigarettes, think about it, look at the packaging – you were buying the brand.
PROMO: Were they buying the brand, or just a free carton of cigarettes?
ZYMAN: You were so committed to the thing, you had to actually be thinking about the thing for a long period of time. It was well thought out, because they were forcing conscious trial.
PROMO: Or self-selecting, which is really standard for sampling these days.
ZYMAN: Maybe today it’s all fixed up and I haven’t kept up with it.
Look at Coke’s Olympic Torch run. When we did it in the U.S., it was unbelievable. When we did it in Japan, it was repetitive. No one thought it through. The difference was, in the U.S. we created celebrations and hired political advance people to knock on doors in advance of the run. We gave product away, and coupons. We could actually see the rise in sales afterwards because we connected with the consumer on something very important. We spent money to give the torch away to the people. It actually went to the core essence of the brand: sharing, hoping, and community.
In Japan, it was nothing close to it. It was a joke. They were more interested in having a torch you could carry underwater.
PROMO: A lot of your examples are tie-ins, borrowed equity. What about promotions that are only about the brand – and sometimes become brands themselves? Like the Pillsbury Bake Off, Campbell’s Labels for Education, or Happy Meals.
ZYMAN: Pillsbury Bake Off I like; Labels for Education I don’t get with regard to the core essence of the brand.
In Mexico, I was working for Cemex, the largest manufacturer of cement, and the Pope was coming to Mexico. They donated all the concrete to build a cross that the Pope was going to bless. I said, “Are you going to give miniature crosses to construction workers (who are incredibly religious people)?” They hadn’t thought of that. I said, “Are you going to have a celebration where you allow the people who actually buy the cement to come and see the cross blessed?” They didn’t think like that. But that’s the essence of the product.
We came up with a promotion giving away floors in poor cities – actually go put a floor in a house that was basically dirt. That’s the core essence of that brand. I love those kinds of promotions.
PROMO: It speaks to the product, its usage, and what the consumer needs. Those are the tenets of the way you look at marketing.
ZYMAN: Sorry. That’s marketing: It’s about selling more stuff more often to more people to make more money in a more efficient way.
The reason I suffered in my career for not being heard or not being able to make a contribution is that marketing was perceived as unnecessary. You read it everyday: “We’re going to cut marketing to make our numbers.” How are you going to get the volume? We tell our clients, “You don’t make money making stuff, you only make money selling stuff.”
My model of marketing is dairy, where you have the stupid cow that doesn’t speak the language you do and produces milk everyday. Either you sell it, or you throw it away. You can’t go to the cow and say, “Tomorrow, half.” The cow is going to give you all the milk. Every manufacturing facility should believe that everything they can make needs to be sold.
PROMO: Isn’t that where people get caught in price promotion? If the cow is going to produce more milk tomorrow, we better sell all she’s given us today.
ZYMAN: That’s lazy marketing. We don’t spend any time coming up with how we can connect with consumers. An idiot can do a price promotion. A monkey can do it.
In 1993, Coke sold nine billion cases, and by 1995 we were selling 15 billion. We basically figured out the only way we could sell soft drinks to consumers was to sell it to them, and we could only sell it if they bought it from us. By the way, we spent $5 million a year on marketing throughout.
We aligned promotion strategy. We got stuff that was recurring. When I was a kid at P&G, we knew we could sell 100 cases, so we’d run a promotion and sell 120. Then they’d say, “Let’s run another promotion” the next year to sell 140. But you have to resell that 100 cases first. If you want to sell 140 cases, you have to come up with a bunch of new reasons for people to buy it.
It was about discipline, every single time. And it was about continuing to do the things that work.
Remember Cairo, the bicycles. The next year they did something else. I asked, “Why don’t you do bikes again?” He said, “We did that last year.” They gave away 10,000 bikes. And I said, “How many people are left without bikes?” If bikes work, why not do it again?
PROMO: Say 10 people see 10 versions of a “relationship marketing” message. What’s the balance between brand essence and customization? Who defines the brand essence, the brand manager or consumers?
ZYMAN: The brand manager. The core essence of brand Coke is continuity and stability – nothing to do with refreshment or taste, but knowing it will always be there. Pepsi’s core essence is choice and change. Apple’s core essence is community: “We the Appleites are different.” McDonald’s has something larger than that: You always know what you’re going to get. You don’t expect it to be spectacularly good, and you don’t expect it to be crappy. You know you’re going to get a meal for a reasonable price.
PROMO: Do you think Disney’s brand is being damaged by its relationship with McDonald’s? You talk in Building Brandwidth about Disney diluting its brand via Happy Meals.
ZYMAN: I don’t understand why they want to get together, strategically. Similar audience? Lazy marketing. McDonald’s has all the consumers they need, 46 million transactions. The question is, how do you get to 47 million?
I don’t think McDonald’s hurts Disney. Disney is a more institutional [umbrella] brand and they’re very good at guarding all their brands. They are almost impossible to deal with because they were very protective of their characters. They have very strict rules. I used to sit around with these guys -55 years old, with white hair and a big belly – and they’d say, “We can’t let Mickey do this or that” and I’d think, What do you do when you go home at night? They get to the point where they start believing stuff.
PROMO: You’re talking about McDonald’s as a product. In your other examples you talk about a much broader, more abstract brand essence – an emotional benefit.
ZYMAN: What is Southwest Airlines? An attitude. It’s the difference between serving 100 people and serving 100 meals. What’s the core essence of Four Seasons – little soap? No, it’s about: “I care.” I stayed yesterday at TriBeCa Grand and I got a call from the bellboy or someone saying, “Hi, this is Guest Services, welcome to the hotel, we’re very happy to have you here, let us know if you need anything.” When I went to the concierge and asked if there’s a gym close by and he told me, “One moment,” and went on with his personal phone conversation. They blew it. The funny part is, when I checked out they asked if I wanted to fill out an evaluation. I blasted the concierge.
PROMO: Customer service plays a role building brands. It’s the emerging piece of marketing strategy right now.
ZYMAN: It’s customer understanding before customer service. Everyone talks about CRM. We say, “It’s customer understanding before you can actually manage the customer.” Airlines don’t feel manning gates isn’t worth the effort because customers only want to buy cheap tickets. So airlines don’t want to invest in treating customers better. It eventually hurts the brand. We just had a little bump in the economy and all the sudden you see promotions cropping up – and it’s all price. Ninety-nine dollars, anywhere you want to go.
PROMO: But that’s easy to do fast. It’s hard to do a value-added promotion quickly.
ZYMAN: If you were doing value-added promotions already, you’d be the one who doesn’t suffer [in an economic slump].
What I argue for – which you don’t like – is, “Give me 20 percent more product in my detergent. Then tell me you’re giving me 20 percent more so I can experience how white this detergent really cleans my shirts,” which is the core essence of that brand. Go back to the core essence in everything you do. People don’t do it. People go for the trinket.
PROMO: Do you think there are too many brands?
ZYMAN: Absolutely. They’re going to go out of business. The biggest problem we have is those damned consumers. They’re not cooperating with a lot of these companies. By not cooperating, they’re putting companies out of business. Vlasic didn’t go into Chapter 11 because they built too many plants – it’s because consumers didn’t buy enough pickles. Consumers know their No. One right is to choose – and that means also to not choose.
PROMO: If the essence of marketing is making it a value proposition for consumers and still profitable, is it too expensive to make it valuable to consumers?
ZYMAN: No. You just have to make sure whatever you’re doing has recurring value. If it’s a one-off, you have to pay more to rent value the next time. If you discount 20 cents, next time you have to discount 25 cents.
Look at what happened with the contour bottle at Coke. It cost us 20 percent more to put the product in contour bottles, but we could sell it for about 50 percent more. We were selling 20 ounces at 89 cents and 2 liters at 99 cents. I never wanted a six-pack because that communicates “discount.” I want to sell at full price, thank you very much.
People were taking 20 bottles off the supermarket shelf and putting it in their carts. The bottlers were making money like thieves.
PROMO: Is there condensation to fewer, more mass brands, and at the same time, personalized brands?
ZYMAN: I don’t think personal brands are really growing. You have more distinct patterns of large groups consuming a product. The question is, how do you do demand-based marketing and target those people? Brands have to have a total proposition to consumers. The largest proposition in marketing today is “me too.”
We’re getting into more product solutions: toothpaste with baking soda, cereal with wheat. We’re forgetting the brands: a bundle of emotional and physical attributes. That’s where brands are created, when consumers turn around and say, “It’s more than product.”
PROMO: Where is trade promotion going, and how will the Internet impact it?
ZYMAN: Few people have captured the potential for the Internet to connect with the trade. At Coke, we invented this thing with Mickey Mouse to get displays. We told store managers that if the display stays up five days, you can keep the Mickey Mouse. That’s trade promotion to me.
Manufacturers have to move business from buy-to-buy to buy-to-sell. You have to be able to tell the trade, “You only make money when you sell a lot of my product. When you try to squeeze me for five cents cheaper, you don’t give me the ability to find ways to help you sell more stuff.” Companies are doing more of that, which means you have to understand your customers’ customers.
It has taken the trade a long time to open up [to collaboration] because their margins are so thin. We went from direct sales to wholesalers to third-party operators, and manufacturers lost control of the ultimate point of sale. The guys who have done best surviving ups and downs are the ones in control of the trade.
PROMO: Where will tomorrow’s good marketers learn their skills?
ZYMAN: That’s the biggest issue for companies: perishability of skills. The amount of information has grown incredibly while the ability to learn is the same. When I worked for P&G, I punched numbers for eight months, then sales training for four months, then assistant brand manager, always watched carefully. Today they go from joining to assistant brand manager to brand manager in no time at all. The result is lousy marketers.
Good marketers are intuitive, those who look to learn. We’re going to see a resurgence of mentors, systems that allow people to learn as they work. If you don’t give people a process, they wander around trying to guess what’s right or wrong.
PROMO: But if people have too much routine, they won’t think. How do you make sure the process doesn’t become routine?
ZYMAN: You force them to think. Routine is repetitive. A process brings out your creativity. [Process gives] a roadmap, but they’ll have to think their way through it.
PROMO: Where will we be in five years?
ZYMAN: Fewer companies, fewer brands. It will get harder and harder to have product differentiation. You have to find new ways to connect. You can’t say, “Drink it when you’re thirsty” because they already do. It’s about finding new ideas. We are animals of consumption – if people give us reasons to consume 20 different things we will.
Marketing is still brutally misunderstood, in every business. At Apple, at The Gap, marketing is product. Marketing has always been surrounded by a veil of mystery.
I believe we have to bring stuff up to a level that is not where it is, and I scratch my head when I see people doing it the wrong way.
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