Herald Sun 24 April, 2010
A Melbourne family is fighting the Afghanistan war - through advertising. That's right. Galloping heroes, cuddly babies, billboards, press, TV and radio commercials, the whole armoury of a modern advertising campaign, without a shot being fired.
The ads are the idea of the US Army's Lt Col Allen McCormick, chief of information operations in eastern Afghanistan. He figured that if you want to create peace, people must first know what peace looks like and understand why what the Taliban are doing is wrong.
45 per cent of the population is under 15, so they have never known what a normal world - where nobody blows you up, summarily shoots you or terrorises you - looks like. McCormick, a Proctor & Gamble marketer back in civvy street, decided to try the kind of advertising that had never been seen in the country before. But who could do it?
Advertising agencies are thin on the ground there, but one stood out. Lapis was given the job, as a core player in Afghanistan's nascent media. It's part of the Moby Group, the local phenomenon owned by a Melbourne family.
Now this is a great story in itself. The Mohseni family were well settled here when, in 2002, they decided they had to help their newly-emerging homeland. But they were not ordinary returnees, they were very smart business people.
Saad Mohseni was an investment banker, Zaid a lawyer, and Jahid an administrator. Then there was their sister, Wajma, a marketer. (It just so happens she's also my daughter's best friend, which is how come I'm so familiar with this story.) They determined to save Afghanistan not through hand-outs but through business, specifically the media which had been destroyed by the Taliban.
Within months they created the country's most popular radio station - when music had been banned for five years, but 45 per cent of the population is under 15. Their mixture of Indian and Iranian film music and selective Western pop was snapped up.
In 2004 they opened Tolo TV, the nation's first independent TV station. They had to produce their own programs including a hugely successful daily soap opera, news, current affairs, even a comedy show that lampoons their self-important politicians.
They had to develop an Afghan music industry, with a studio and record company, and produce countless video clips. They set up a film company that has also been involved in international movies like The Kite Runner.
Most famously they created Afghan Star, a TV series based on Australian Star. Thousands of young hopeful singers paraded before judges and were gonged out, just like here. But they also had to learn not to make a fuss or come back later with guns for revenge, if they were told how bad they were.
The final contest of four runners-up was a nail-biter watched by all Afghanistan (including Taliban). It was filmed as a documentary which won major prizes at the Sundance Movie Festival.
The Mohsenis continue to grow in influence - and wealth - though they are constantly at loggerheads with the government and parliament, who hate them nearly as much as the Taliban do. Hopefully the advertising campaign and the closer ties with the US military will give them some muscular friends.
As for Wajma, she is the Moby Group's Marketing Director, but recently moved her operations to the group's huge Dubai offices. We heaved a sigh of relief at this - for years we worried about her, a high-profile target for enemies on all sides of the political spectrum. For her the best times are when she visits Australia. No guns, no bodyguards, no armoured cars. There are benefits in a quiet life.
24 April, 2010
It's all in the image
Melbourne Herald Sun 24th April 2010
We all have an image. It's the picture we present to the world that says "this is who I am" or "this is what my company is". We are each aware of it, we can all see it, but in fact it is as insubstantial as the photographic dye on a film, and as fragile as crystal.
In recent weeks we have seen a vivid demonstration of the lightness of image. A few months ago Christine Nixon was only a short distance behind Mary McKillop in the saintship stakes, retired with honour after having taken a broom to Victoria's musty police service, and welcomed as Chair of the Bushfire Reconstruction Authority.
Now a haircut and a pub dinner later and she's suddenly painted as uncaring, incompetent and unfit. Can this be the same, smart, chubby blonde lady?
Or take Rio Tinto, one of the saviours of Australia's wealth through the global economic crisis. But after the Chinese bribery trials and the stories that are now leaking out, the halo is starting to slip.
We can all immediately recognise image problems. Qantas is still the safest airline in the world but if they don't get their maintenance under control they're in trouble. Nowadays a drop in tyre pressure is enough to put them on the front pages.
Tiger Woods has had the worst winter of his life, while even the Pope is facing a horror trip.
So what is this image? I prefer to call it "a climate of opinion," what the world thinks of you. It's like the weather and as insubstantial and difficult to control. Companies and celebrities love to bask in the sunshine of good opinion but it only takes one cloud to bring on the storms and the chills.
Also in this land of ours we have the tall poppy syndrome. Here you can be hugely successful and still be given a negative image.
Think of the highest-grossing Australian film of all time. Mad Max? Australia? Nope - Crocodile Dundee. Paul Hogan redefined the Australian image and they've been chopping at his stem and roots ever since.
Derryn Hinch has a unique position as both cutter and victim - how many times has he been chopped? But he has been smart enough to turn this public churn into his unique image.
In politics image is everything, so politicians are most vulnerable. They even face a paid, dedicated team of image smashers known as The Opposition, closely helped by the media, forever looking for tomorrow's headline or tonight's news bulletin.
Bill Clinton somehow survived eight years in power with daily assaults on his image. Peter Garrett has discovered the icy waters of Parliament after years in the warm bath of fame and adulation. A decade earlier Cheryl Kernot had her image smashed after she jumped from the Democrats to Labor.
Business has many landmines. Look at Toyota with its tidal wave of recalls and problems - you have to wonder how even such a strong company can recreate its image of a solid, perfectly reliable car.
In the US the Domino's Pizza chain was brought low when two kitchen staff made a YouTube video of pizza being prepared as they messed around throwing food on the floor and up a nose. Domino's quality ratings halved overnight.
How can you protect yourself under such an assault? It's like a fire - if you can't put it out at least try to contain it. And the worst thing you can do to your image is to pretend the problem does not exist.
If you're spending squillions on a big public relations company retainer, you'll find that all they can really do is hold your hand and whisper the following advice:
Identify the problem and respond quickly - don't sit on it and hope it will go away. If you were my client I'd grill you for the truth, the whole truth. There's no gain in deceiving your doctor or your PR man.
You give the story as good a spin as possible: "As soon as the toxic leak was discovered the company put its emergency plan into operation."
Ideally, give the communications task to your top person - the CEO or chairman. The media will want to talk to them anyway.
Whatever you do, don't lie. It will always come out in the end. (Remember "I did not have sex with that woman"?).
Better to tell the whole truth however unpalatable. Say "He was drunk and in bed with his sister" in one mouthful, rather than waiting for the media to pull it out like teeth, headline by headline. "He was drunk!" Then "He was in bed!" and another few days later "With his sister!" Instead of one mouthful for the rabid dogs, you turned it into an ongoing feast.
This was the mistake Christine Nixon made. Instead of declaring all the facts of that fateful Saturday and copping one slap, she allowed it to be slowly extracted, so it became a string of front pages and news bulletins, and weeks of droning talkback hypocrisy.
So after the smoke has cleared, can a tarnished image be repolished? Well yes - especially if you have money.
Alfred Nobel invented dynamite and helped blow up millions around the world in last century's wars. But judicious placement of his legacy has made his name the world standard of peace.
Locally we have a fascinating study of image rebuilding. Steve Vizard was the darling of both the public and the establishment. Then came the issue of his share trading while a director of Telstra. Controversy exploded, and with it his image.
He is still midway through a 10-year ban from the corporate world but we are seeing his supreme media skills at work as he slowly claws his way back. Selfless donations by his foundation. Art works lent to the state. And now the resurfacing of his human face, and humour, on new radio station MTR.
There's a lot of work involved in piecing together the shattered crystal of a broken image.
We all have an image. It's the picture we present to the world that says "this is who I am" or "this is what my company is". We are each aware of it, we can all see it, but in fact it is as insubstantial as the photographic dye on a film, and as fragile as crystal.
In recent weeks we have seen a vivid demonstration of the lightness of image. A few months ago Christine Nixon was only a short distance behind Mary McKillop in the saintship stakes, retired with honour after having taken a broom to Victoria's musty police service, and welcomed as Chair of the Bushfire Reconstruction Authority.
Now a haircut and a pub dinner later and she's suddenly painted as uncaring, incompetent and unfit. Can this be the same, smart, chubby blonde lady?
Or take Rio Tinto, one of the saviours of Australia's wealth through the global economic crisis. But after the Chinese bribery trials and the stories that are now leaking out, the halo is starting to slip.
We can all immediately recognise image problems. Qantas is still the safest airline in the world but if they don't get their maintenance under control they're in trouble. Nowadays a drop in tyre pressure is enough to put them on the front pages.
Tiger Woods has had the worst winter of his life, while even the Pope is facing a horror trip.
So what is this image? I prefer to call it "a climate of opinion," what the world thinks of you. It's like the weather and as insubstantial and difficult to control. Companies and celebrities love to bask in the sunshine of good opinion but it only takes one cloud to bring on the storms and the chills.
Also in this land of ours we have the tall poppy syndrome. Here you can be hugely successful and still be given a negative image.
Think of the highest-grossing Australian film of all time. Mad Max? Australia? Nope - Crocodile Dundee. Paul Hogan redefined the Australian image and they've been chopping at his stem and roots ever since.
Derryn Hinch has a unique position as both cutter and victim - how many times has he been chopped? But he has been smart enough to turn this public churn into his unique image.
In politics image is everything, so politicians are most vulnerable. They even face a paid, dedicated team of image smashers known as The Opposition, closely helped by the media, forever looking for tomorrow's headline or tonight's news bulletin.
Bill Clinton somehow survived eight years in power with daily assaults on his image. Peter Garrett has discovered the icy waters of Parliament after years in the warm bath of fame and adulation. A decade earlier Cheryl Kernot had her image smashed after she jumped from the Democrats to Labor.
Business has many landmines. Look at Toyota with its tidal wave of recalls and problems - you have to wonder how even such a strong company can recreate its image of a solid, perfectly reliable car.
In the US the Domino's Pizza chain was brought low when two kitchen staff made a YouTube video of pizza being prepared as they messed around throwing food on the floor and up a nose. Domino's quality ratings halved overnight.
How can you protect yourself under such an assault? It's like a fire - if you can't put it out at least try to contain it. And the worst thing you can do to your image is to pretend the problem does not exist.
If you're spending squillions on a big public relations company retainer, you'll find that all they can really do is hold your hand and whisper the following advice:
Identify the problem and respond quickly - don't sit on it and hope it will go away. If you were my client I'd grill you for the truth, the whole truth. There's no gain in deceiving your doctor or your PR man.
You give the story as good a spin as possible: "As soon as the toxic leak was discovered the company put its emergency plan into operation."
Ideally, give the communications task to your top person - the CEO or chairman. The media will want to talk to them anyway.
Whatever you do, don't lie. It will always come out in the end. (Remember "I did not have sex with that woman"?).
Better to tell the whole truth however unpalatable. Say "He was drunk and in bed with his sister" in one mouthful, rather than waiting for the media to pull it out like teeth, headline by headline. "He was drunk!" Then "He was in bed!" and another few days later "With his sister!" Instead of one mouthful for the rabid dogs, you turned it into an ongoing feast.
This was the mistake Christine Nixon made. Instead of declaring all the facts of that fateful Saturday and copping one slap, she allowed it to be slowly extracted, so it became a string of front pages and news bulletins, and weeks of droning talkback hypocrisy.
So after the smoke has cleared, can a tarnished image be repolished? Well yes - especially if you have money.
Alfred Nobel invented dynamite and helped blow up millions around the world in last century's wars. But judicious placement of his legacy has made his name the world standard of peace.
Locally we have a fascinating study of image rebuilding. Steve Vizard was the darling of both the public and the establishment. Then came the issue of his share trading while a director of Telstra. Controversy exploded, and with it his image.
He is still midway through a 10-year ban from the corporate world but we are seeing his supreme media skills at work as he slowly claws his way back. Selfless donations by his foundation. Art works lent to the state. And now the resurfacing of his human face, and humour, on new radio station MTR.
There's a lot of work involved in piecing together the shattered crystal of a broken image.
07 April, 2010
Sad operas make my guyliner run
Melbourne Herald Sun, Wednesday April 7 2010
If a cosmetics maker has a dream of heaven, it's the day when men take up the use of make-up and lotions in the same volumes as women.
And they have certainly tried. Eight years ago they thought they had cracked it with the evolution of the 'metrosexual' male. You might recall that he was the young, affluent city dweller who spent all his cash and attention on himself, his body and his clothes. David Beckham was the great idol of the breed.
Such was the influence of this movement that no less than Mark Latham, in his vitriolic autobiography, claimed this country was in decline: "Australian mates and good blokes have been replaced by nervous wrecks, metrosexual knobs and tossbags," he cried.
But when the cosmetic moguls awoke they found that the world had not followed their dreams. Aussie men are more resistant to the trend than their European counterparts.
In the US, Unilever are bringing out a new Dove range of men's products, personal wash, hair care and deodorants, called Dove Men+Care. In Australia, however, only the deodorant part is coming. Is the Australian male shy about his grooming?
Not according to Melbourne success, Natio. This company is minuscule compared to its rivals, but it has jumped to number one men's skincare brand in David Jones. What do they know that the others don't?
"It was our product team came up with the idea of a men's range," said their Managing Director Max Ross. "I thought it wouldn't work because we're in female products, but I'm pleased to say they proved me wrong."
Their men's face creams jumped off the chemists' shelves far more quickly than expected. "We found out what was happening - it was women buying the products for their men, to stop them pinching their expensive face creams."
They have since expanded the men's range to 16 products including lip balm, moisturiser, eye cream and body wash. How far can they take it? Well Ruff hears that their skin bronzer is also being pinched in the bathroom, so that may be the next in line.
Then there's the fringe. In America, singing star Adam Lambert is planning to launch his own range of cosmetics for men. Foremost will be guyliner - eye liner for men, more popular on the rock arena stage than in the local high street. But also foundation, concealer, shadow, mascara, lip gloss, and nail polish, said an announcement last month.
Lambert is very publicly gay so maybe it's easy to dismiss this as a "gay thing" that doesn't touch the mainstream. But then Max Ross confided that one of the important features in the success of Natio was its popularity in the gay community. From there it rapidly spread into the mainstream - as do so many fashions and attitudes.
But don't worry fellas, it will be a while before you can't go out without your lippy and a touch of blush. This revolution is moving at glacial pace.
In Australia's $1 billion cosmetics market, a mere seven per cent is classified as male grooming. "Cosmetics is a mature industry," explained IBIS Research General Manager Rob Bryant. "Companies are looking for areas of innovation, and men's products are an obvious target."
So expect more attention to be paid to men's skin and crow's feet, from the cosmetic companies' advertising, but particularly from their women.
As for me - the opera season starts this month. But I think I'll go to opening night without my guyliner.
ray@ebeatty.com
If a cosmetics maker has a dream of heaven, it's the day when men take up the use of make-up and lotions in the same volumes as women.
And they have certainly tried. Eight years ago they thought they had cracked it with the evolution of the 'metrosexual' male. You might recall that he was the young, affluent city dweller who spent all his cash and attention on himself, his body and his clothes. David Beckham was the great idol of the breed.
Such was the influence of this movement that no less than Mark Latham, in his vitriolic autobiography, claimed this country was in decline: "Australian mates and good blokes have been replaced by nervous wrecks, metrosexual knobs and tossbags," he cried.
But when the cosmetic moguls awoke they found that the world had not followed their dreams. Aussie men are more resistant to the trend than their European counterparts.
In the US, Unilever are bringing out a new Dove range of men's products, personal wash, hair care and deodorants, called Dove Men+Care. In Australia, however, only the deodorant part is coming. Is the Australian male shy about his grooming?
Not according to Melbourne success, Natio. This company is minuscule compared to its rivals, but it has jumped to number one men's skincare brand in David Jones. What do they know that the others don't?
"It was our product team came up with the idea of a men's range," said their Managing Director Max Ross. "I thought it wouldn't work because we're in female products, but I'm pleased to say they proved me wrong."
Their men's face creams jumped off the chemists' shelves far more quickly than expected. "We found out what was happening - it was women buying the products for their men, to stop them pinching their expensive face creams."
They have since expanded the men's range to 16 products including lip balm, moisturiser, eye cream and body wash. How far can they take it? Well Ruff hears that their skin bronzer is also being pinched in the bathroom, so that may be the next in line.
Then there's the fringe. In America, singing star Adam Lambert is planning to launch his own range of cosmetics for men. Foremost will be guyliner - eye liner for men, more popular on the rock arena stage than in the local high street. But also foundation, concealer, shadow, mascara, lip gloss, and nail polish, said an announcement last month.
Lambert is very publicly gay so maybe it's easy to dismiss this as a "gay thing" that doesn't touch the mainstream. But then Max Ross confided that one of the important features in the success of Natio was its popularity in the gay community. From there it rapidly spread into the mainstream - as do so many fashions and attitudes.
But don't worry fellas, it will be a while before you can't go out without your lippy and a touch of blush. This revolution is moving at glacial pace.
In Australia's $1 billion cosmetics market, a mere seven per cent is classified as male grooming. "Cosmetics is a mature industry," explained IBIS Research General Manager Rob Bryant. "Companies are looking for areas of innovation, and men's products are an obvious target."
So expect more attention to be paid to men's skin and crow's feet, from the cosmetic companies' advertising, but particularly from their women.
As for me - the opera season starts this month. But I think I'll go to opening night without my guyliner.
ray@ebeatty.com
27 March, 2010
Minding the minders - professional services firms
Melbourne Herald Sun 27 March 2010
When the world is in turmoil, who minds out for the minders? All those experts that companies depend on, where do they go when business slows to a crawl?
They call themselves the Professional Service Firms. The accountants, lawyers, engineers and architects. They depend on a thriving economy too. Though many of them will always make a good quid, whichever way the wind blows.
Futurologist Phil Ruthven's firm IBIS has done a study on these PSFs. It shows that behind the dark suits and grey bookcases there's a revolution going on.
Take the accountants. For two years now they have seen revenue falling. But not by much. Like the banks, the Big Four (Deloitts, KPMG, Ernst & Young, PWC) have taken the opportunity to do a bit of cherry picking.
They have snapped up smaller rivals with strategic portfolios, and used their ample war-chests to buy into new markets like Brazil, Russia, India and China.
Of course, whether you're winning or losing, the accountant will always have a way to make money out of you. Companies that are struggling to stay afloat need them. And this helps to make up for the dip in other business areas, managing takeovers and new-company launches.
As a bonus, they have been given a flood of business from new requirements in the areas of environment, terrorism and fraud - these are guaranteed growth markets.
Law firms of course share this bonanza. Though business slowed in 2009, the demand for lawyers continues to grow. The post-Copenhagen world is creating a whole new 'green' market, regardless of politicians' waffling; and the economic scares have seen flourishing business in crime and divorces.
There are professions that have felt the pain more than others. Take the engineers. Suddenly hundreds of big engineering projects have been put on the shelf. After years of seven per cent growth, they are now looking at a downturn of six percent.
The larger firms are finding relief in China and India and the rest of the booming Asian market. But it isn't easy pickings. The big shots in Europe and North America have also been lusting after these contracts so the competition gets pretty fierce. Even worse, these firms are also looking for pickings in the booming parts of Australia.
Every time you see the skeleton of an unfinished building or a weed-grown fenced-off wasteland in the middle of a city, there is an architect somewhere weeping into his gin. Building has slowed down all around the world and that has severely cut the returns of architecture.
But IBIS has good news for them. From next year the building market is expected to rebound by five per cent a year. However the successful firms are the ones that expand the range of their activities. They are moving into the business of building project management.
Finally there are the management consultants. Everything from executive training to HR, from marketing to IT. After a very flat year they can expect increases of over four per cent a year. Once again it's the big firms that will flourish. Some of the smaller ones will need to attach themselves to accounting and law firms, others will have to look overseas.
Now China's a good opportunity for them, with this niche business expected to grow 12 per cent in the next five years. But you can only work there if you partner a local firm.
So you can expect to see our professionals moving further from their Collins St and Macquarie St towers into a big scary world where competition is intense but the rewards are huge.
ray@ebeatty.com
When the world is in turmoil, who minds out for the minders? All those experts that companies depend on, where do they go when business slows to a crawl?
They call themselves the Professional Service Firms. The accountants, lawyers, engineers and architects. They depend on a thriving economy too. Though many of them will always make a good quid, whichever way the wind blows.
Futurologist Phil Ruthven's firm IBIS has done a study on these PSFs. It shows that behind the dark suits and grey bookcases there's a revolution going on.
Take the accountants. For two years now they have seen revenue falling. But not by much. Like the banks, the Big Four (Deloitts, KPMG, Ernst & Young, PWC) have taken the opportunity to do a bit of cherry picking.
They have snapped up smaller rivals with strategic portfolios, and used their ample war-chests to buy into new markets like Brazil, Russia, India and China.
Of course, whether you're winning or losing, the accountant will always have a way to make money out of you. Companies that are struggling to stay afloat need them. And this helps to make up for the dip in other business areas, managing takeovers and new-company launches.
As a bonus, they have been given a flood of business from new requirements in the areas of environment, terrorism and fraud - these are guaranteed growth markets.
Law firms of course share this bonanza. Though business slowed in 2009, the demand for lawyers continues to grow. The post-Copenhagen world is creating a whole new 'green' market, regardless of politicians' waffling; and the economic scares have seen flourishing business in crime and divorces.
There are professions that have felt the pain more than others. Take the engineers. Suddenly hundreds of big engineering projects have been put on the shelf. After years of seven per cent growth, they are now looking at a downturn of six percent.
The larger firms are finding relief in China and India and the rest of the booming Asian market. But it isn't easy pickings. The big shots in Europe and North America have also been lusting after these contracts so the competition gets pretty fierce. Even worse, these firms are also looking for pickings in the booming parts of Australia.
Every time you see the skeleton of an unfinished building or a weed-grown fenced-off wasteland in the middle of a city, there is an architect somewhere weeping into his gin. Building has slowed down all around the world and that has severely cut the returns of architecture.
But IBIS has good news for them. From next year the building market is expected to rebound by five per cent a year. However the successful firms are the ones that expand the range of their activities. They are moving into the business of building project management.
Finally there are the management consultants. Everything from executive training to HR, from marketing to IT. After a very flat year they can expect increases of over four per cent a year. Once again it's the big firms that will flourish. Some of the smaller ones will need to attach themselves to accounting and law firms, others will have to look overseas.
Now China's a good opportunity for them, with this niche business expected to grow 12 per cent in the next five years. But you can only work there if you partner a local firm.
So you can expect to see our professionals moving further from their Collins St and Macquarie St towers into a big scary world where competition is intense but the rewards are huge.
ray@ebeatty.com
20 March, 2010
Mobile phones and confusion marketing
Melbourne Herald Sun, 20th March 2010
They always call when you're about to eat dinner or your favourite TV show is starting. Now I'm not a nasty person and I don't like being rude to someone who's only doing their job, so sometimes I make the error of answering a question.
"How much are you paying on your telephone bill Mr Beatty?" And then: "We can give the exact same service for $50 cheaper plus a free Nokia XYZ phone - would you like your phone bill to be $50 cheaper?"
Well who's going to say no to that? Next thing you know you are repeating the legal agreement for recording purposes and you have made the switch. Next morning you wake up and recall - what the hell have I done?
If the deal goes through, in a month or two you will compare your new bill with some old ones and find there's no difference - it may be even worse.
Did you just get a bit confused? Well that was quite deliberate - I have only recently discovered that there is a genuine science at work here: confusion marketing. That's now a real phrase in the dictionary. I'm sure they teach courses on it at Harvard.
The point is to get the consumer so confused by varying rates, plans, offers and deals that it becomes near-impossible to make a true comparison between companies.
Banks and credit card companies love the deals. They trumpet their low-rate terms, credit at only two percent interest! Now that will make a difference to your monthly bills. You transfer the debts over. And it's amazing how quickly six months pass, after which the interest jumps to 22 percent.
Electricity and gas companies have now been chopped up into providers and retailers, who all have teams of sales people selling contracts. Wonderful, competition. At one stage I had a sales call almost once a week, each with an irresistible offer that slashed my power bills.
Once or twice, I confess, I did chop and change. But you know what? My power bills kept growing and are higher than ever before.
A new version has appeared in recent years on the Internet. This happened recently to my wife. She found a book on a topic that interested her and bought it on-line. Now all these offers have pages and pages of sales pitch, testimonials, and how great your life will be once you have that book.
What she didn't notice, buried in the spiel, was a line that says: "And you'll become a member of our Philosophy Discussion Group, receiving pages of fascinating information every week." Which went on, "Membership is only $29 a month, automatically deducted from your credit card account, unless you decline the offer within 10 days."
So there's the confusion hook. By ordering the book, she also gave them the right to deduct money for ever. Fortunately she spotted it a few days later and stopped it. Not easy to do, as nowhere on the site was there an "I quit" button.
Of course the masters of confusion marketing are politicians. The easiest way to kill your opponent's policy is not through sophisticated argument. It's by making the issue so muddy and confused that the voters throw their hands up and decide it's all too hard.
It's very difficult to counter-attack. All you can do is get very simplistic yourself and hope you can hit your opponent with a better slogan than the one he is using. Does this all sound very familiar to you?
ray@ebeatty.com
They always call when you're about to eat dinner or your favourite TV show is starting. Now I'm not a nasty person and I don't like being rude to someone who's only doing their job, so sometimes I make the error of answering a question.
"How much are you paying on your telephone bill Mr Beatty?" And then: "We can give the exact same service for $50 cheaper plus a free Nokia XYZ phone - would you like your phone bill to be $50 cheaper?"
Well who's going to say no to that? Next thing you know you are repeating the legal agreement for recording purposes and you have made the switch. Next morning you wake up and recall - what the hell have I done?
If the deal goes through, in a month or two you will compare your new bill with some old ones and find there's no difference - it may be even worse.
Did you just get a bit confused? Well that was quite deliberate - I have only recently discovered that there is a genuine science at work here: confusion marketing. That's now a real phrase in the dictionary. I'm sure they teach courses on it at Harvard.
The point is to get the consumer so confused by varying rates, plans, offers and deals that it becomes near-impossible to make a true comparison between companies.
Banks and credit card companies love the deals. They trumpet their low-rate terms, credit at only two percent interest! Now that will make a difference to your monthly bills. You transfer the debts over. And it's amazing how quickly six months pass, after which the interest jumps to 22 percent.
Electricity and gas companies have now been chopped up into providers and retailers, who all have teams of sales people selling contracts. Wonderful, competition. At one stage I had a sales call almost once a week, each with an irresistible offer that slashed my power bills.
Once or twice, I confess, I did chop and change. But you know what? My power bills kept growing and are higher than ever before.
A new version has appeared in recent years on the Internet. This happened recently to my wife. She found a book on a topic that interested her and bought it on-line. Now all these offers have pages and pages of sales pitch, testimonials, and how great your life will be once you have that book.
What she didn't notice, buried in the spiel, was a line that says: "And you'll become a member of our Philosophy Discussion Group, receiving pages of fascinating information every week." Which went on, "Membership is only $29 a month, automatically deducted from your credit card account, unless you decline the offer within 10 days."
So there's the confusion hook. By ordering the book, she also gave them the right to deduct money for ever. Fortunately she spotted it a few days later and stopped it. Not easy to do, as nowhere on the site was there an "I quit" button.
Of course the masters of confusion marketing are politicians. The easiest way to kill your opponent's policy is not through sophisticated argument. It's by making the issue so muddy and confused that the voters throw their hands up and decide it's all too hard.
It's very difficult to counter-attack. All you can do is get very simplistic yourself and hope you can hit your opponent with a better slogan than the one he is using. Does this all sound very familiar to you?
ray@ebeatty.com
The battle of the bank managers
Melbourne Herald Sun, 20th March 2010
Do you have one of the 600 smiling, friendly bank managers from Westpac, or is she the cold, hard-faced cow "Barbara" depicted by the ANZ? As competition between banks hots up, we're now going into the Battle of the Bank Managers.
The problems they are addressing were created by the banks themselves, of course. For more than 20 years they have slashed branches, decimated staff, neglected small business in favour of big-time developers and financial markets.
Those of us struggling to make a quid and pay off huge mortgages have watched as every quarter they announce their billion-dollar profits and then increase interest rates by the Reserve Bank index plus a bit more on top. Then they weep crocodile tears about the growing costs of borrowing, as if we cared.
When they do research on themselves they find - horror! - that the public doesn't like them. A recent survey was made by West Australian mortgage manager Homeloans. They found that the number of Australians who "liked" the four major banks the Commonwealth, Westpac, NAB and ANZ had fallen by 15 per cent between August and the end of last year. In fact, says the survey, less than one in four likes the big banks.
Now such a situation is not only commercially unpleasant - it is also politically dangerous. It means that the Government can do anything it likes to the banks and nary a tear will be shed. There are votes in being nasty to banks.
Hence the spate of new TV commercials with their swarms of smiling bankers.
Anyone in small business knows how impossible it is to develop a relationship with your bank. If your branch has a manager at all (rather than a distant "business centre"), you will try to get to know your manager - you never know when you'll need them. But then one day you'll walk in and find he's been moved to Toowoomba and you have to start with some new 25-year-old.
Well it seems that branch managers are back, at least at Westpac. In their new campaign they confess to having seen the light: "We're bringing back over 600 local bank managers," they declare, and on their web site, sure enough, you can find the name of your branch manager.
The ANZ obviously believes that you think your bank manager cold and intimidating and are happy without one. Hence their "And no Barbara" campaign. It's an interesting marketing ploy - making the virtue out of not matching your opponent's high card.
The NAB have also faced harsh realities. Their new campaign says they will stop robbing you. Or not so much anyway. "More give, less take" is the slogan. We'll believe that when they announce they have halved their profits and given the money back to their customers.
The Commonwealth Bank obviously held their summer seminar at Hogwarts. They now have a benign, smiling bank manager who, with the help of his magical iPad, can conjure up a new house for a girl in a matter of minutes. That's finding the house, buying it and settling the mortgage with the wave of a finger over a computer screen. No wonder his name is the rather familiar sounding Henry Pottson.
For several years St George Bank has cashed in on this bank aversion with a TV commercial set at a barbecue. Our character is asked what work he does. When he confesses "I'm a banker" a sudden hush falls over the gathering and you feel before long there will be a lynch mob. Then he splutters: "With the St George!" and all is well, because they are small, almost not a bank.
Trouble is they are now part of Westpac, so there goes their line of defence and also, presumably, that commercial.
ray@ebeatty.com
Do you have one of the 600 smiling, friendly bank managers from Westpac, or is she the cold, hard-faced cow "Barbara" depicted by the ANZ? As competition between banks hots up, we're now going into the Battle of the Bank Managers.
The problems they are addressing were created by the banks themselves, of course. For more than 20 years they have slashed branches, decimated staff, neglected small business in favour of big-time developers and financial markets.
Those of us struggling to make a quid and pay off huge mortgages have watched as every quarter they announce their billion-dollar profits and then increase interest rates by the Reserve Bank index plus a bit more on top. Then they weep crocodile tears about the growing costs of borrowing, as if we cared.
When they do research on themselves they find - horror! - that the public doesn't like them. A recent survey was made by West Australian mortgage manager Homeloans. They found that the number of Australians who "liked" the four major banks the Commonwealth, Westpac, NAB and ANZ had fallen by 15 per cent between August and the end of last year. In fact, says the survey, less than one in four likes the big banks.
Now such a situation is not only commercially unpleasant - it is also politically dangerous. It means that the Government can do anything it likes to the banks and nary a tear will be shed. There are votes in being nasty to banks.
Hence the spate of new TV commercials with their swarms of smiling bankers.
Anyone in small business knows how impossible it is to develop a relationship with your bank. If your branch has a manager at all (rather than a distant "business centre"), you will try to get to know your manager - you never know when you'll need them. But then one day you'll walk in and find he's been moved to Toowoomba and you have to start with some new 25-year-old.
Well it seems that branch managers are back, at least at Westpac. In their new campaign they confess to having seen the light: "We're bringing back over 600 local bank managers," they declare, and on their web site, sure enough, you can find the name of your branch manager.
The ANZ obviously believes that you think your bank manager cold and intimidating and are happy without one. Hence their "And no Barbara" campaign. It's an interesting marketing ploy - making the virtue out of not matching your opponent's high card.
The NAB have also faced harsh realities. Their new campaign says they will stop robbing you. Or not so much anyway. "More give, less take" is the slogan. We'll believe that when they announce they have halved their profits and given the money back to their customers.
The Commonwealth Bank obviously held their summer seminar at Hogwarts. They now have a benign, smiling bank manager who, with the help of his magical iPad, can conjure up a new house for a girl in a matter of minutes. That's finding the house, buying it and settling the mortgage with the wave of a finger over a computer screen. No wonder his name is the rather familiar sounding Henry Pottson.
For several years St George Bank has cashed in on this bank aversion with a TV commercial set at a barbecue. Our character is asked what work he does. When he confesses "I'm a banker" a sudden hush falls over the gathering and you feel before long there will be a lynch mob. Then he splutters: "With the St George!" and all is well, because they are small, almost not a bank.
Trouble is they are now part of Westpac, so there goes their line of defence and also, presumably, that commercial.
ray@ebeatty.com
13 March, 2010
Have a break, have a ... soy?
Melbourne Herald Sun, 13th March 2010
Have a break have a ... soy-sauce-flavoured Kit Kat? Or how about a spicy wasabi-flavoured white chocolate Kit Kat? Sound tempting? I'm sorry but you won't find them at your local milk bar, not in this country.
Yes you've guessed it, where else but Japan could such a taste sensation happen - and be a huge marketing success.
In Japan, Nestle have taken line extension to lengths that are baffling to the more conservative Australian marketplace. They make Kit Kat in 19 flavours - like yubari melon, baked corn, green beans and cherries, and red potatoes. Now wouldn't they delight the kids' Christmas stockings?
But before you shake you heads and say, "They're mad," think on this. Kit Kat is now the biggest-selling confectionery brand in Japan. That's a lot of corn and potatoes, not to mention dough.
Nestle have always been flexible and innovative in their marketing. Fifteen years ago I wrote about their Relais Bebe (Baby Stop) program in France where holidaying families with babies could stop, feed their babies and have a free coffee and croissants - using, of course, all Nestle products. This was not just a one-off promotion - I see they now have 16 of them every summer.
The point is to get involved with the customer, think about what they need or desire, and think like a local. I can imagine that at HQ on the banks of Lake Geneva, Switzerland, wasabe Kit Kat would not be regarded as a good idea. Yet they let their Japanese subsidiary proceed with it, trusting their local people to know better than a distant warren of gnomes.
This is a difficult thing for a corporation to do, their instinct is to dictate. But the soft touch produces results.
Other companies are a little more cautious. McDonald's now allows the Japanese a Filet O Shrimp burger, and Pepsi gives them a cucumber flavored soft drink.
But marketing is more than product, it's distribution. Again Kit Kat have hit the jackpot. It appears that the phrase Kitto Katsu means "sure to win". This is a favourite slogan told to students about to take exams. Kinda like "Knock 'em dead kid!"
The Japanese being great gift-givers, they send their young ones off with a card and a box of Kitto Katsu bought at the local post office. Now their post offices are no more prone to selling sweets than ours are, but the marketing team managed to sew up a massive, 22,000 post office, nation-wide distribution deal. And with no competitors!
The Kitto Katsu campaign earned Nestle and their advertising agency, JWT Tokyo, the 2009 Media Grand Prix at Cannes.
Polyphenols are plant chemicals that supposedly work as antioxidants and preventers of heart disease and cancer. They are now the key ingredient in the highly popular Nescafe Excella - promoted through lyrical TV commercials starring Meg Ryan. She doesn't speak Japanese, but obviously they think she's healthy.
The company's latest initiative is a big marketing drive on the internet. They are pushing their range through Rakuten Ichiba, the largest internet >shopping mall= in Japan. It claims to have over 25,000 virtual shops, 40 million members and $8 billion in sales.
The lessons here are the most neglected truisms in business. When you hire somebody and give them a responsibility - trust them to do the job. Give them the freedom to innovate with products and markets. Sometimes they might make mistakes, but other times they will have spectacular successes.
After all, in your corporate ivory tower, what do you know about the average Japanese's tastes in chocolate?
Ray@ebeatty.com
Have a break have a ... soy-sauce-flavoured Kit Kat? Or how about a spicy wasabi-flavoured white chocolate Kit Kat? Sound tempting? I'm sorry but you won't find them at your local milk bar, not in this country.
Yes you've guessed it, where else but Japan could such a taste sensation happen - and be a huge marketing success.
In Japan, Nestle have taken line extension to lengths that are baffling to the more conservative Australian marketplace. They make Kit Kat in 19 flavours - like yubari melon, baked corn, green beans and cherries, and red potatoes. Now wouldn't they delight the kids' Christmas stockings?
But before you shake you heads and say, "They're mad," think on this. Kit Kat is now the biggest-selling confectionery brand in Japan. That's a lot of corn and potatoes, not to mention dough.
Nestle have always been flexible and innovative in their marketing. Fifteen years ago I wrote about their Relais Bebe (Baby Stop) program in France where holidaying families with babies could stop, feed their babies and have a free coffee and croissants - using, of course, all Nestle products. This was not just a one-off promotion - I see they now have 16 of them every summer.
The point is to get involved with the customer, think about what they need or desire, and think like a local. I can imagine that at HQ on the banks of Lake Geneva, Switzerland, wasabe Kit Kat would not be regarded as a good idea. Yet they let their Japanese subsidiary proceed with it, trusting their local people to know better than a distant warren of gnomes.
This is a difficult thing for a corporation to do, their instinct is to dictate. But the soft touch produces results.
Other companies are a little more cautious. McDonald's now allows the Japanese a Filet O Shrimp burger, and Pepsi gives them a cucumber flavored soft drink.
But marketing is more than product, it's distribution. Again Kit Kat have hit the jackpot. It appears that the phrase Kitto Katsu means "sure to win". This is a favourite slogan told to students about to take exams. Kinda like "Knock 'em dead kid!"
The Japanese being great gift-givers, they send their young ones off with a card and a box of Kitto Katsu bought at the local post office. Now their post offices are no more prone to selling sweets than ours are, but the marketing team managed to sew up a massive, 22,000 post office, nation-wide distribution deal. And with no competitors!
The Kitto Katsu campaign earned Nestle and their advertising agency, JWT Tokyo, the 2009 Media Grand Prix at Cannes.
Polyphenols are plant chemicals that supposedly work as antioxidants and preventers of heart disease and cancer. They are now the key ingredient in the highly popular Nescafe Excella - promoted through lyrical TV commercials starring Meg Ryan. She doesn't speak Japanese, but obviously they think she's healthy.
The company's latest initiative is a big marketing drive on the internet. They are pushing their range through Rakuten Ichiba, the largest internet >shopping mall= in Japan. It claims to have over 25,000 virtual shops, 40 million members and $8 billion in sales.
The lessons here are the most neglected truisms in business. When you hire somebody and give them a responsibility - trust them to do the job. Give them the freedom to innovate with products and markets. Sometimes they might make mistakes, but other times they will have spectacular successes.
After all, in your corporate ivory tower, what do you know about the average Japanese's tastes in chocolate?
Ray@ebeatty.com
10 March, 2010
Raking in the dough from fat
Melbourne Herald Sun, 10th April 2010
Now put down that doughnut and tell me the truth. Are you as fit and healthy and slim as you'd like? The sad fact, of course, is that very few of us are.
The Medical Journal of Australia has just warned us that obesity is costing this country $56 billion a year. And that's just the health side. Naturally we have to do something about it, as a nation. And as every businessperson knows, where there's muck there's brass. (Or maybe it should be where there's fat there's dough.) So what are the business opportunities?
Certainly over the past decade there has been rapid growth in the business of getting us slim. Figures from the Bureau of Statistics showed that the number of job vacancies in the health and fitness sector was at an all time high, in 2008. It was reported that personal training was growing, along with gym memberships, fitness club openings and sales of fitness programs, with a shortage of staff to run them all.
There are now nearly two million Australians using these fitness centres - and more are joining up every day. You can expect to see the pressure grow from state and federal governments anxious to reduce their health costs - not to mention the pressure from our fellow citizens anxious to reduce their spouses.
Fitness Australia, the industry's association, claims that the centres contributed $900 million to our economy two years ago, and employed 17,000 people, though 80 per cent of these were part time. Since 2004 it was growing at seven per cent a year.
But, as Peter Garrett learned when his insulation scheme revealed bats in the belfry, fast growth can have its problems. So it is with fitness. A trainee can go from scratch to a Master Trainer qualification in just eight weeks. It ain't exactly a medical degree. And it means that some people who achieve the status can be less than dedicated.
Fitness Australia calls them the 'cowboys'. The small, inadequate operations that promise far more than they deliver, and leave unhappy customers in their wake.
So FA run education and training schemes for exercise professionals who are registered with them, requiring them to keep up to date. Their member businesses have to follow a code of practice or risk losing the association's 'licence'.
One of their major headaches has been the bad publicity from dodgy banking practices. At the front end, there's often a team of attractive, young, enthusiastic sales people urging you to sign up and become as beautiful as they are. Who can resist a gorgeous slim blonde in shorts - whatever their sex?
But once you've signed the reams of forms they have your banking details. All well and good until you decide you want to leave. As the Consumer Association's Choice Magazine put it, "The gym's sense of urgency suddenly evaporates. You're forced to jump through the most outlandish hoops just to cancel a membership you should have every right to terminate over the phone."
Pressure from state and federal consumer affairs departments have improved the situation somewhat - but before you sign anything, read the fine print carefully.
The industry is now consolidating into a smaller number of large franchises like Fitness First, with nearly a hundred gyms; Fernwood with its women-only niche of 80 clubs; even that money bloodhound Richard Branston has sniffed the brass and started his Virgin Active chain.
Local councils have begun to charge trainers for the use of their parks and beaches, while the music industry is suing for a big hike in royalties for those endless Madonna and ABBA tunes.
Ah yes, once you're doing well, everyone wants a slice of the pie.
Ray@ebeatty.com
Now put down that doughnut and tell me the truth. Are you as fit and healthy and slim as you'd like? The sad fact, of course, is that very few of us are.
The Medical Journal of Australia has just warned us that obesity is costing this country $56 billion a year. And that's just the health side. Naturally we have to do something about it, as a nation. And as every businessperson knows, where there's muck there's brass. (Or maybe it should be where there's fat there's dough.) So what are the business opportunities?
Certainly over the past decade there has been rapid growth in the business of getting us slim. Figures from the Bureau of Statistics showed that the number of job vacancies in the health and fitness sector was at an all time high, in 2008. It was reported that personal training was growing, along with gym memberships, fitness club openings and sales of fitness programs, with a shortage of staff to run them all.
There are now nearly two million Australians using these fitness centres - and more are joining up every day. You can expect to see the pressure grow from state and federal governments anxious to reduce their health costs - not to mention the pressure from our fellow citizens anxious to reduce their spouses.
Fitness Australia, the industry's association, claims that the centres contributed $900 million to our economy two years ago, and employed 17,000 people, though 80 per cent of these were part time. Since 2004 it was growing at seven per cent a year.
But, as Peter Garrett learned when his insulation scheme revealed bats in the belfry, fast growth can have its problems. So it is with fitness. A trainee can go from scratch to a Master Trainer qualification in just eight weeks. It ain't exactly a medical degree. And it means that some people who achieve the status can be less than dedicated.
Fitness Australia calls them the 'cowboys'. The small, inadequate operations that promise far more than they deliver, and leave unhappy customers in their wake.
So FA run education and training schemes for exercise professionals who are registered with them, requiring them to keep up to date. Their member businesses have to follow a code of practice or risk losing the association's 'licence'.
One of their major headaches has been the bad publicity from dodgy banking practices. At the front end, there's often a team of attractive, young, enthusiastic sales people urging you to sign up and become as beautiful as they are. Who can resist a gorgeous slim blonde in shorts - whatever their sex?
But once you've signed the reams of forms they have your banking details. All well and good until you decide you want to leave. As the Consumer Association's Choice Magazine put it, "The gym's sense of urgency suddenly evaporates. You're forced to jump through the most outlandish hoops just to cancel a membership you should have every right to terminate over the phone."
Pressure from state and federal consumer affairs departments have improved the situation somewhat - but before you sign anything, read the fine print carefully.
The industry is now consolidating into a smaller number of large franchises like Fitness First, with nearly a hundred gyms; Fernwood with its women-only niche of 80 clubs; even that money bloodhound Richard Branston has sniffed the brass and started his Virgin Active chain.
Local councils have begun to charge trainers for the use of their parks and beaches, while the music industry is suing for a big hike in royalties for those endless Madonna and ABBA tunes.
Ah yes, once you're doing well, everyone wants a slice of the pie.
Ray@ebeatty.com
06 March, 2010
Upsizing – how to maximise your sales
Melbourne Herald Sun, 6th March 2010
If you run a business I don't have to tell you how hard it is. You advertise and proselytise, urge and cajole, promise and plead to get a customer through the door. You drag that business in and take great pride in the feat.
But once you have them, do you get all you should out of them? Or do you think your job's done now they are through the door?
There is an art to good business, which is maximising your sale, getting the most out of each customer.
The deli owner knows it, and asks, "Something else?" after wrapping each product. The fast food retailer knows it, when the customer orders a hamburger and is asked "You want fries with that?"
This up selling strategy was made famous by McDonalds restaurants. In the past it added some 35% to the value of each transaction. However by the early 90s fast foods started to dip in popularity under claims of poor nutrition and obesity.
It was Melbourne that gave the world the answer - opening the first McCafe selling coffee and Danish pastries. Now the question is "Do you want a cappuccino with that?" And the per-sale profitability has gone up to some 60%.
The great lessons in up-selling come from the USA. They developed the pattern where some 35% of fast food and snack sales include a soft drink with them. When you consider the billions of dollars turned over by these companies, you get an inkling of the amount of money involved. No wonder the world's biggest McDonalds is in the Coca Cola building in Manhattan.
Another variation of this is up sizing. So when you go to the movies and get persuaded to buy an overpriced coke and popcorn, you are then told: "For an extra $3 you get the jumbo popcorn and the mega coke". Well, what's another $3? But then - when are you ever going to eat so much popcorn?
Up-selling works in every business, not just restaurants. I recall a client with a carpet-cleaning franchise. Their operators were extremely good at their jobs. But at the end they would leave with just the $100 or so cleaning fee - not a great deal to pay two salaries, a van and the driving time. They needed to add to this turnover.
So we designed them a catalogue on how to look after carpets - featuring a range of products that should be in the closet.
As they cleaned, the customer would read the book - and usually buy some cleaning fluids or even a high-efficiency vacuum cleaner. In the end these add-ons could increase the price of the visit by an average of $30. And the customer was happy that she had not been pressured.
When you buy a car you're used to being sold up. ("And would you like a roo bar with that?") Especially profitable for dealerships are the extended guarantees which deliver the commissions immediately - while the later costs are covered by insurance.
Computers are an unlimited field for the technique. I bet none of us has bought one without being persuaded that an extra $100 would double the hard disc and double the ram.
The greatest problem with upselling, in any industry I've known, has always been the staff. They need training, bribing, cajoling, to put in that extra effort and sell a little more. Within hours of reading this piece you'll be in a shop where the assistant will cheerfully take your money without giving a thought to selling you one of the extras or treats hanging round the counter.
And somewhere will be a boss tearing their hair out because of all the missed opportunities from the customers they worked so hard at to pull into the shop.
Ray@ebeatty.com
If you run a business I don't have to tell you how hard it is. You advertise and proselytise, urge and cajole, promise and plead to get a customer through the door. You drag that business in and take great pride in the feat.
But once you have them, do you get all you should out of them? Or do you think your job's done now they are through the door?
There is an art to good business, which is maximising your sale, getting the most out of each customer.
The deli owner knows it, and asks, "Something else?" after wrapping each product. The fast food retailer knows it, when the customer orders a hamburger and is asked "You want fries with that?"
This up selling strategy was made famous by McDonalds restaurants. In the past it added some 35% to the value of each transaction. However by the early 90s fast foods started to dip in popularity under claims of poor nutrition and obesity.
It was Melbourne that gave the world the answer - opening the first McCafe selling coffee and Danish pastries. Now the question is "Do you want a cappuccino with that?" And the per-sale profitability has gone up to some 60%.
The great lessons in up-selling come from the USA. They developed the pattern where some 35% of fast food and snack sales include a soft drink with them. When you consider the billions of dollars turned over by these companies, you get an inkling of the amount of money involved. No wonder the world's biggest McDonalds is in the Coca Cola building in Manhattan.
Another variation of this is up sizing. So when you go to the movies and get persuaded to buy an overpriced coke and popcorn, you are then told: "For an extra $3 you get the jumbo popcorn and the mega coke". Well, what's another $3? But then - when are you ever going to eat so much popcorn?
Up-selling works in every business, not just restaurants. I recall a client with a carpet-cleaning franchise. Their operators were extremely good at their jobs. But at the end they would leave with just the $100 or so cleaning fee - not a great deal to pay two salaries, a van and the driving time. They needed to add to this turnover.
So we designed them a catalogue on how to look after carpets - featuring a range of products that should be in the closet.
As they cleaned, the customer would read the book - and usually buy some cleaning fluids or even a high-efficiency vacuum cleaner. In the end these add-ons could increase the price of the visit by an average of $30. And the customer was happy that she had not been pressured.
When you buy a car you're used to being sold up. ("And would you like a roo bar with that?") Especially profitable for dealerships are the extended guarantees which deliver the commissions immediately - while the later costs are covered by insurance.
Computers are an unlimited field for the technique. I bet none of us has bought one without being persuaded that an extra $100 would double the hard disc and double the ram.
The greatest problem with upselling, in any industry I've known, has always been the staff. They need training, bribing, cajoling, to put in that extra effort and sell a little more. Within hours of reading this piece you'll be in a shop where the assistant will cheerfully take your money without giving a thought to selling you one of the extras or treats hanging round the counter.
And somewhere will be a boss tearing their hair out because of all the missed opportunities from the customers they worked so hard at to pull into the shop.
Ray@ebeatty.com
20 February, 2010
Do we need the Nanny State to save us from cold calls?
Melbourne Herald Sun, 20th February, 2010
Just last week I was complaining about telemarketers and how their phone calls interrupt the evening's dinner and telly.
Now while I was narked at their timing, I didn't say I wanted the poor working stiffs thrown out of a job and set on the street to beg. They have to make a living as we all do, and some jobs are better than others.
Not all are so soft-hearted - I see that our anointed betters are planning to do just that. In 2007 they set up the Do Not Call Register that allows you to stop telemarketers calling your home. Fair enough, it's like putting a "No Advertising Material" sticker on your gate.
But currently, in Parliament, there's a move to extend this, by allowing all businesses and organisations to list themselves - all their telephone and fax numbers.
The trouble is, there are 440,000 small companies in Australia that rely, to a significant degree, on telephone calling to win business. It is the most cost-effective form of business-to-business advertising and an awful lot of firms - and jobs - depend on it.
To my mind, forbidding cold calls is a denial of freedom of speech. The receiver can always tell me to get lost, that's his right, too. But do we need a law to police this?
It's the old nanny state syndrome. We who fought for freedom from censorship, women's liberation, gay rights, sexual freedom, freedom to wear jeans to the office - are finding ourselves compressed by a remorseless political correctness.
From politicians and education administrators, doctors and judges, there is inch by inch pressure to force us all back into the box.
So Manly City Council is trying to ban the sale of bubblegum in shopping centres, the sale of puppies and kittens in pet stores, smoking on the beach, plastic bags and the sale of bottled water at public events.
Senator Stephen Conroy, whose department is responsible for the Do Not Call Bill, is also ploughing ahead with his internet filtering legislation. Which adds up to his being the Minister for the Nanny State Imposition.
A few months ago, at a Melbourne PC User Group meeting, some 300 computer enthusiasts were quizzed by their President, Keith Younger, who asked how many members favoured the internet filtering legislation. Not one hand went up. How many thought it would work? None. Who thought it would slow down our already dismal internet speeds? Up went a forest of hands.
I have yet to find someone in favour of it - but who can stop a NSW politician with a mission?
Mind you, who are we to talk? Already in Victoria soft drinks have been banned from government schools, all confectionary will soon follow. Now I'm not an advocate for child obesity - I just don't like some politician telling me or my kids what to do.
Macquarie University has banned the sale of cigarettes on campus. Back in my day at uni, wearing shaggy hair and puffing endless fags was what it was all about. You grew out of it - in your own time.
Funny thing about nannies. Remember a few years ago when the Howard Government brought in Net Nanny, the free parental software to control children's internet viewing? Well Telstra reported that only one percent of parents ever made use of it. So it's not in demand from the voters.
Oh and the latest internet warning is to beware of messages from the Do Not Call Register. They are being used to deliver a type of virus called trojans, which collect your email and phone details. For sale to the less scrupulous telemarketers.
ray@ebeatty.com
Just last week I was complaining about telemarketers and how their phone calls interrupt the evening's dinner and telly.
Now while I was narked at their timing, I didn't say I wanted the poor working stiffs thrown out of a job and set on the street to beg. They have to make a living as we all do, and some jobs are better than others.
Not all are so soft-hearted - I see that our anointed betters are planning to do just that. In 2007 they set up the Do Not Call Register that allows you to stop telemarketers calling your home. Fair enough, it's like putting a "No Advertising Material" sticker on your gate.
But currently, in Parliament, there's a move to extend this, by allowing all businesses and organisations to list themselves - all their telephone and fax numbers.
The trouble is, there are 440,000 small companies in Australia that rely, to a significant degree, on telephone calling to win business. It is the most cost-effective form of business-to-business advertising and an awful lot of firms - and jobs - depend on it.
To my mind, forbidding cold calls is a denial of freedom of speech. The receiver can always tell me to get lost, that's his right, too. But do we need a law to police this?
It's the old nanny state syndrome. We who fought for freedom from censorship, women's liberation, gay rights, sexual freedom, freedom to wear jeans to the office - are finding ourselves compressed by a remorseless political correctness.
From politicians and education administrators, doctors and judges, there is inch by inch pressure to force us all back into the box.
So Manly City Council is trying to ban the sale of bubblegum in shopping centres, the sale of puppies and kittens in pet stores, smoking on the beach, plastic bags and the sale of bottled water at public events.
Senator Stephen Conroy, whose department is responsible for the Do Not Call Bill, is also ploughing ahead with his internet filtering legislation. Which adds up to his being the Minister for the Nanny State Imposition.
A few months ago, at a Melbourne PC User Group meeting, some 300 computer enthusiasts were quizzed by their President, Keith Younger, who asked how many members favoured the internet filtering legislation. Not one hand went up. How many thought it would work? None. Who thought it would slow down our already dismal internet speeds? Up went a forest of hands.
I have yet to find someone in favour of it - but who can stop a NSW politician with a mission?
Mind you, who are we to talk? Already in Victoria soft drinks have been banned from government schools, all confectionary will soon follow. Now I'm not an advocate for child obesity - I just don't like some politician telling me or my kids what to do.
Macquarie University has banned the sale of cigarettes on campus. Back in my day at uni, wearing shaggy hair and puffing endless fags was what it was all about. You grew out of it - in your own time.
Funny thing about nannies. Remember a few years ago when the Howard Government brought in Net Nanny, the free parental software to control children's internet viewing? Well Telstra reported that only one percent of parents ever made use of it. So it's not in demand from the voters.
Oh and the latest internet warning is to beware of messages from the Do Not Call Register. They are being used to deliver a type of virus called trojans, which collect your email and phone details. For sale to the less scrupulous telemarketers.
ray@ebeatty.com
Marching to the beat of a different drum
Melbourne Herald Sun, 20th February 2010
Were you ever an army cadet? My own version of that was an outfit called the Sea Cadets. Much like army cadets, only dressed in little blue uniforms and white sailors hats.
We never seemed to have anything to do with sailing or water but spent much of our time marching up and down the parade ground tossing rifles from shoulder to shoulder. I later learned that the reason for this was to drill into us a sense of being a part of an unthinking herd and reacting to orders from any superior without question.
It left me with a lifelong suspicion of regimentation and attempts to make me gallop in any one direction.
I was reminded of this the other day when my hardware store told me they no longer supplied carrier bags. So I walked off, purchases in arms because I suddenly got mean about buying one of their fabric bags.
This was the third time that day it had happened and I realised I was observing a trend. Multi-squillion dollar retail chains suddenly getting righteous about plastic bags and the environment, and saving themselves some money in the process.
The vast amount of packaging that surrounds their goods - boxes and plastic packs, cellophane and polyethylene and polly-wally doo dah day - are conveniently overlooked while the micrometre-thick plastic bag is banished. Now I have no liking for the bags either - but doesn't this all smell of hypocrisy?
We often come across the gallop of stampeding herds. If you can trigger it, there is no better marketing tool.
Inching though the city traffic jams you can find yourself in a solid herd of CRVs. Big boxy four-wheel drives designed for scaling mountains and fording torrents. What on earth are they doing on the Monash Car Park? It's not as if they're allowed to climb the banks and skirt the traffic.
But some clever marketers persuaded many of our citizens that they are intrepid rugged pioneers. Even if they only drive to Collins Street and back.
Rugged individualism doesn't work any more when it goes mass-market. Once upon a time a muscle-bound Chesty Bond type would put intricate Celtic tattoos around his biceps. These days go into a supermarket and you'll be surrounded by tattoos. Worn by housewives, teens, factory workers and clerks. Not quite so rugged any more - but great for the tattoo industry.
Sometimes the trend can be a triumph. Wherever you stand in the herd, you insist on a good cup of coffee these days. The frothing Gaggia is a necessity for any eating establishment. The day-old jar of stewed coffee is hard to find. Hey even McDonalds can serve up a good macchiato in their Mac Café.
These trends can be manipulated. Remember that seedy, ill-suited Welsh phone salesman who entered Britain's Got Talent? Looked sad and dreary till he opened his mouth and sang like Pavarotti. The video clip went round the world and made Paul Potts an overnight sensation.
Think that was fate? Forget it! That was marketing. ("Here run down to the Salvos and find the bloke an awful suit. And I want the hair really nerdy....") So that when he sang the contrast was jaw-dropping. In fact he'd studied opera for years including professional training in Italy.
A couple of years later they found Paul a cross-gender twin in Susan Boyle. Same thing - Scottish spinster in a daggy outfit, bad haircut and makeup - and a brilliant voice. Look at her current albums in the shop today and you'll see her the way she could have looked then. But it wouldn't have pulled off the marketing twist, to arouse the excitement of the herd and send them stampeding to the cash registers.
ray@ebeatty.com
Were you ever an army cadet? My own version of that was an outfit called the Sea Cadets. Much like army cadets, only dressed in little blue uniforms and white sailors hats.
We never seemed to have anything to do with sailing or water but spent much of our time marching up and down the parade ground tossing rifles from shoulder to shoulder. I later learned that the reason for this was to drill into us a sense of being a part of an unthinking herd and reacting to orders from any superior without question.
It left me with a lifelong suspicion of regimentation and attempts to make me gallop in any one direction.
I was reminded of this the other day when my hardware store told me they no longer supplied carrier bags. So I walked off, purchases in arms because I suddenly got mean about buying one of their fabric bags.
This was the third time that day it had happened and I realised I was observing a trend. Multi-squillion dollar retail chains suddenly getting righteous about plastic bags and the environment, and saving themselves some money in the process.
The vast amount of packaging that surrounds their goods - boxes and plastic packs, cellophane and polyethylene and polly-wally doo dah day - are conveniently overlooked while the micrometre-thick plastic bag is banished. Now I have no liking for the bags either - but doesn't this all smell of hypocrisy?
We often come across the gallop of stampeding herds. If you can trigger it, there is no better marketing tool.
Inching though the city traffic jams you can find yourself in a solid herd of CRVs. Big boxy four-wheel drives designed for scaling mountains and fording torrents. What on earth are they doing on the Monash Car Park? It's not as if they're allowed to climb the banks and skirt the traffic.
But some clever marketers persuaded many of our citizens that they are intrepid rugged pioneers. Even if they only drive to Collins Street and back.
Rugged individualism doesn't work any more when it goes mass-market. Once upon a time a muscle-bound Chesty Bond type would put intricate Celtic tattoos around his biceps. These days go into a supermarket and you'll be surrounded by tattoos. Worn by housewives, teens, factory workers and clerks. Not quite so rugged any more - but great for the tattoo industry.
Sometimes the trend can be a triumph. Wherever you stand in the herd, you insist on a good cup of coffee these days. The frothing Gaggia is a necessity for any eating establishment. The day-old jar of stewed coffee is hard to find. Hey even McDonalds can serve up a good macchiato in their Mac Café.
These trends can be manipulated. Remember that seedy, ill-suited Welsh phone salesman who entered Britain's Got Talent? Looked sad and dreary till he opened his mouth and sang like Pavarotti. The video clip went round the world and made Paul Potts an overnight sensation.
Think that was fate? Forget it! That was marketing. ("Here run down to the Salvos and find the bloke an awful suit. And I want the hair really nerdy....") So that when he sang the contrast was jaw-dropping. In fact he'd studied opera for years including professional training in Italy.
A couple of years later they found Paul a cross-gender twin in Susan Boyle. Same thing - Scottish spinster in a daggy outfit, bad haircut and makeup - and a brilliant voice. Look at her current albums in the shop today and you'll see her the way she could have looked then. But it wouldn't have pulled off the marketing twist, to arouse the excitement of the herd and send them stampeding to the cash registers.
ray@ebeatty.com
06 February, 2010
Steve Jobs, iPad and the art of being second
February 6th, 2010
Just this week we have seen a demonstration of how to succeed by being second, from the king of being second. The man who made himself a billionaire by never being first.
It might surprise you that I'm talking about Steve Jobs, the CEO and living god of Apple. But you could learn so much by emulating his marketing brilliance.
And it is marketing we are talking here, not inventive genius. Apple is more like the couture houses of Paris than the sweaty labs of Silicone Valley. It's all about style and show and fashion. And it works - it has kept working for 30 years.
Back in the early '80s a rash of small, cheap "personal" computers emerged based on chips from Motorola and Intel. Apple was one of these. Their breakthrough came when they borrowed the graphical user interface (that's what GUI means), and the mouse, from the Xerox labs and brought out the Macintosh.
From the beginning Jobs used the world's greatest designers, starting with Hartmut Esslinger for the Macintosh line. It was launched on the Super Bowl with a two million dollar commercial made by Ridley Scott.
Called "1984" - that was the year - it showed the stuffy old-world conventions being smashed by an aggressive young sportswoman. It spoke to the hearts of the Gen-Xes who have been loyal Apple fans ever since.
When Jobs was axed in 1985 after a boardroom stoush, the company declined and then went into nose-dive. After 12 years they begged him to return. They needed his marketing magic - and got it.
H e brought with him the new generation's design genius, Englishman Jonathan Ive. They set to work and soon came up with the bulbous, coloured, translucent iMacs that looked like they came from another planet. Suddenly Apples were sexy again.
There were already plenty of personal MP3 players around but it took Ive's design and Jobs' marketing to create the iPod. Married to iTunes it became a music industry phenomenon.
Hundreds of companies around the world were making excellent mobile phones, but a little clever engineering and a lot of brilliant marketing created the iPhone, not just a tool but a toy.
Last week Jobs unveiled the iPad in San Francisco and the world's media and trendsetters reacted like the Spice Girls at a Galliano fashion launch.
No word about the note pad launched by Bill Gates in 2002 or the Amazon Kindle from 2007. And those two aren't exactly shrinking violets in the marketing sphere, either.
Jobs has never given us anything we didn't have before. His brilliance is his understanding of design, attention to quality, and - most importantly - very clever marketing. Like a magician, when he reveals the new product, you think you've experienced something totally new.
How often I come across clients who feel defensive because their competitors are already selling a product like theirs. Only cheaper or bigger or they've been in the market much longer.
My response is, forget about the competition. From now on your product is the first, the best, and without equal. Scrap your tired old "me too" advertising, we're going to re-invent you.
After this past week I can add a new morality tale to my repertoire: Look at Steve Jobs - he launches the iPad in the teeth of competition from established Microsoft and Amazon brands, it lacks even a USB port or camera. But it is beautiful, fun, and it's Apple. They are already queueing for it.
Now, take a close look at your own product, how it looks and how it's marketed. It might be No 2 or even No 10, but it can still be made a winner.
ray@ebeatty.com
Just this week we have seen a demonstration of how to succeed by being second, from the king of being second. The man who made himself a billionaire by never being first.
It might surprise you that I'm talking about Steve Jobs, the CEO and living god of Apple. But you could learn so much by emulating his marketing brilliance.
And it is marketing we are talking here, not inventive genius. Apple is more like the couture houses of Paris than the sweaty labs of Silicone Valley. It's all about style and show and fashion. And it works - it has kept working for 30 years.
Back in the early '80s a rash of small, cheap "personal" computers emerged based on chips from Motorola and Intel. Apple was one of these. Their breakthrough came when they borrowed the graphical user interface (that's what GUI means), and the mouse, from the Xerox labs and brought out the Macintosh.
From the beginning Jobs used the world's greatest designers, starting with Hartmut Esslinger for the Macintosh line. It was launched on the Super Bowl with a two million dollar commercial made by Ridley Scott.
Called "1984" - that was the year - it showed the stuffy old-world conventions being smashed by an aggressive young sportswoman. It spoke to the hearts of the Gen-Xes who have been loyal Apple fans ever since.
When Jobs was axed in 1985 after a boardroom stoush, the company declined and then went into nose-dive. After 12 years they begged him to return. They needed his marketing magic - and got it.
H e brought with him the new generation's design genius, Englishman Jonathan Ive. They set to work and soon came up with the bulbous, coloured, translucent iMacs that looked like they came from another planet. Suddenly Apples were sexy again.
There were already plenty of personal MP3 players around but it took Ive's design and Jobs' marketing to create the iPod. Married to iTunes it became a music industry phenomenon.
Hundreds of companies around the world were making excellent mobile phones, but a little clever engineering and a lot of brilliant marketing created the iPhone, not just a tool but a toy.
Last week Jobs unveiled the iPad in San Francisco and the world's media and trendsetters reacted like the Spice Girls at a Galliano fashion launch.
No word about the note pad launched by Bill Gates in 2002 or the Amazon Kindle from 2007. And those two aren't exactly shrinking violets in the marketing sphere, either.
Jobs has never given us anything we didn't have before. His brilliance is his understanding of design, attention to quality, and - most importantly - very clever marketing. Like a magician, when he reveals the new product, you think you've experienced something totally new.
How often I come across clients who feel defensive because their competitors are already selling a product like theirs. Only cheaper or bigger or they've been in the market much longer.
My response is, forget about the competition. From now on your product is the first, the best, and without equal. Scrap your tired old "me too" advertising, we're going to re-invent you.
After this past week I can add a new morality tale to my repertoire: Look at Steve Jobs - he launches the iPad in the teeth of competition from established Microsoft and Amazon brands, it lacks even a USB port or camera. But it is beautiful, fun, and it's Apple. They are already queueing for it.
Now, take a close look at your own product, how it looks and how it's marketed. It might be No 2 or even No 10, but it can still be made a winner.
ray@ebeatty.com
30 January, 2010
Rudd, Obama and the political beauty contest
Melbourne Herald Sun, 30th January, 2010
If you think business is a competitive slog - keeping your product on the shelf, fighting price-cutting rivals, being subject to the whims of public popularity - then spare a little sympathy for politicians.
Theirs is the hardest task of all, with opinions fluctuating almost weekly and always some new election just around the corner. They use all the same phrases as marketers - defining the brand, segmenting the market, profiling the consumer (voter), and selling the message.
And if any politician tells you they are not interested in opinion polls, watch their eyes carefully through the TV screen because they are lying.
It's some years since I worked on a political campaign but I've got to tell you it's exciting. Your clients are all these famous faces off the telly, everything you do seems to end up on the evening news.
Issues can blow up into disasters in the space of a day, and the advertisers and policy makers will huddle together to hammer out a response. Sometimes you'd run out of a meeting straight to a studio to make a TV commercial overnight.
If that sounds stressful, you'd better believe it. But then after a while the adrenaline becomes addictive.
Right now we are seeing the political chooks aflap in three continents.
America's love affair with Barack Obama has turned to plate-throwing before they've even wiped the "Just Married" paint off the car. Two govenorships and Ted Kennedy's holy seat wiped out in a voter backlash that has both President and party stunned.
Always too smart to be proud, Obama has called back the team that did it for him in the first place. David Plouffe was his campaign manager in the election and he has been put in charge of all the Democrats' coming elections in November.
Taking another nibble of humble pie, he has turned to Bill Clinton. Not surprisingly - Clinton's biography for his first term reads like a day plan for what has happened to Obama to date. However, Clinton rescued himself and won a second term. Suddenly he is being looked on with new respect.
Of course down here it all sounds familiar, looking at our own Prime Minister. The Rudd of Kevin 07 has lost his gloss and even at a time when the economy and employment are bright there are still plenty of worried frowns.
The opinion polls are running strongly for the Government so far this year, according to Gary Morgan. The ALP sits on a comfortable 58.5 against a Liberal-National Party 41.5, and the PM at 61 per cent approval.
But every politician knows how quickly the tide can turn, especially with a new opposition leader in an election year.
So as in America, the ALP is re-igniting its advertising team. Nearly 30 years ago, Bob Hawke amazed the country by appointing arch-rightist John Singleton to do the ALP advertising, using his agency, now called STW. But Singo has gone, as have the key creatives who devised the campaigns.
So recently the party swapped to McCann-Erickson. This was the agency that created 1972's It's Time campaign, so the party has come full circle. Presumably their brief is, "It's not yet time".
It's an election year in Britain too, with Prime Minister Gordon Brown looking like he's preparing the charge of the Light Brigade. Within five months he will be galloping against the massed guns of a revitalised Conservative Party under their glamorous young leader David Cameron.
UK Labour's ad team is feverishly studying the Obama history book in the hope of inspiration. Sorry fellas, the author needs a bit of it himself right now.
Ray@ebeatty.com
If you think business is a competitive slog - keeping your product on the shelf, fighting price-cutting rivals, being subject to the whims of public popularity - then spare a little sympathy for politicians.
Theirs is the hardest task of all, with opinions fluctuating almost weekly and always some new election just around the corner. They use all the same phrases as marketers - defining the brand, segmenting the market, profiling the consumer (voter), and selling the message.
And if any politician tells you they are not interested in opinion polls, watch their eyes carefully through the TV screen because they are lying.
It's some years since I worked on a political campaign but I've got to tell you it's exciting. Your clients are all these famous faces off the telly, everything you do seems to end up on the evening news.
Issues can blow up into disasters in the space of a day, and the advertisers and policy makers will huddle together to hammer out a response. Sometimes you'd run out of a meeting straight to a studio to make a TV commercial overnight.
If that sounds stressful, you'd better believe it. But then after a while the adrenaline becomes addictive.
Right now we are seeing the political chooks aflap in three continents.
America's love affair with Barack Obama has turned to plate-throwing before they've even wiped the "Just Married" paint off the car. Two govenorships and Ted Kennedy's holy seat wiped out in a voter backlash that has both President and party stunned.
Always too smart to be proud, Obama has called back the team that did it for him in the first place. David Plouffe was his campaign manager in the election and he has been put in charge of all the Democrats' coming elections in November.
Taking another nibble of humble pie, he has turned to Bill Clinton. Not surprisingly - Clinton's biography for his first term reads like a day plan for what has happened to Obama to date. However, Clinton rescued himself and won a second term. Suddenly he is being looked on with new respect.
Of course down here it all sounds familiar, looking at our own Prime Minister. The Rudd of Kevin 07 has lost his gloss and even at a time when the economy and employment are bright there are still plenty of worried frowns.
The opinion polls are running strongly for the Government so far this year, according to Gary Morgan. The ALP sits on a comfortable 58.5 against a Liberal-National Party 41.5, and the PM at 61 per cent approval.
But every politician knows how quickly the tide can turn, especially with a new opposition leader in an election year.
So as in America, the ALP is re-igniting its advertising team. Nearly 30 years ago, Bob Hawke amazed the country by appointing arch-rightist John Singleton to do the ALP advertising, using his agency, now called STW. But Singo has gone, as have the key creatives who devised the campaigns.
So recently the party swapped to McCann-Erickson. This was the agency that created 1972's It's Time campaign, so the party has come full circle. Presumably their brief is, "It's not yet time".
It's an election year in Britain too, with Prime Minister Gordon Brown looking like he's preparing the charge of the Light Brigade. Within five months he will be galloping against the massed guns of a revitalised Conservative Party under their glamorous young leader David Cameron.
UK Labour's ad team is feverishly studying the Obama history book in the hope of inspiration. Sorry fellas, the author needs a bit of it himself right now.
Ray@ebeatty.com
23 January, 2010
Is the supermarket discounting or ripping us off?
Melbourne Herald Sun, 23rd January, 2010
Friday evening. Pop down to the supermarket for a bottle of white to go with the fish. Aha, Safeway have 30% off their wines this week. Then you study the poster more closely. The offer is only if you buy a half dozen. So if I buy just one, I'll pay 43% more per bottle than if I bought a box?
This annoys me so I pop across the road to Coles. They have exactly the same offer, on the same terms. I wonder if the ACCC is aware of this price collusion. Dinner's on the stove so I grab a single bottle and resentfully pay nearly half more than the discounted price, and make a mental note to avoid supermarkets for my wine in future.
Can you see what has happened? Some bright spark in the marketing department has said, "Let's sell lots of wine this week by giving them big discounts on half-dozen boxes." But in the thinking process, completely neglected to foresee that they would annoy the hell out of every customer who did not want to buy their wine by the crate.
We're all used to the fact that the gift we bought for a Christmas present will cost half as much in the Boxing Day sale. It's a pain to see it in the store window but we accept that them's the breaks in shopping.
But at other times, discounting is a delicate process that needs to be handled with tact. There are many ways of doing it. The brown goods stores like the "no repayment, no interest for two years" angle. If you analyse the offer, two years' interest on the cost would equal about 20 per cent discount. On high profit items like furniture that ensures there will still be a good return in the end.
The crowds of buyers stampeding through the shopping centres this month shows you how many of the public hold back their purchases until the big red SALE! stickers appear. It also reveals the high mark-ups put on many goods, particularly the swanky up-market clothing. A pair of trousers may be hundreds of dollars cheaper, a suit by a thousand or more. I have to confess that any item of mine bearing labels by Zegna or Versace has been acquired thanks to massive price-slashing.
On the other side of the coin, if yours is a small business you have to be cautious about giving discounts,. Follow this example: you have an item that costs you $100, normally marked up by 30 per cent. That makes it $130. Being the January sales, you cut the price by 20 per cent, to $104.
Now, in order to make as much as the original profit, you'll have to sell seven times more items - and still only make $28.
If you're in business, you can't be lazy about thinking through the sums. You have to know precisely the value of an item you are selling and the true cost of discounts.
Now the public find maths a strain they were glad to leave behind after school, which is fortunate for many retailers who often create illusions of generosity while giving away very little.
Take the example of selling jeans. Say you find some belts that only cost two dollars each, in quantity from China. Instead of cutting the price by 10 or 20 dollars, you add a "free fashion belt". You have increased the perceived value of the purchase - but kept most of your profit margin.
Now you're using discounting to increase your sales, keeping money in your pocket, and not infuriating the customers.
ray@ebeatty.com
Friday evening. Pop down to the supermarket for a bottle of white to go with the fish. Aha, Safeway have 30% off their wines this week. Then you study the poster more closely. The offer is only if you buy a half dozen. So if I buy just one, I'll pay 43% more per bottle than if I bought a box?
This annoys me so I pop across the road to Coles. They have exactly the same offer, on the same terms. I wonder if the ACCC is aware of this price collusion. Dinner's on the stove so I grab a single bottle and resentfully pay nearly half more than the discounted price, and make a mental note to avoid supermarkets for my wine in future.
Can you see what has happened? Some bright spark in the marketing department has said, "Let's sell lots of wine this week by giving them big discounts on half-dozen boxes." But in the thinking process, completely neglected to foresee that they would annoy the hell out of every customer who did not want to buy their wine by the crate.
We're all used to the fact that the gift we bought for a Christmas present will cost half as much in the Boxing Day sale. It's a pain to see it in the store window but we accept that them's the breaks in shopping.
But at other times, discounting is a delicate process that needs to be handled with tact. There are many ways of doing it. The brown goods stores like the "no repayment, no interest for two years" angle. If you analyse the offer, two years' interest on the cost would equal about 20 per cent discount. On high profit items like furniture that ensures there will still be a good return in the end.
The crowds of buyers stampeding through the shopping centres this month shows you how many of the public hold back their purchases until the big red SALE! stickers appear. It also reveals the high mark-ups put on many goods, particularly the swanky up-market clothing. A pair of trousers may be hundreds of dollars cheaper, a suit by a thousand or more. I have to confess that any item of mine bearing labels by Zegna or Versace has been acquired thanks to massive price-slashing.
On the other side of the coin, if yours is a small business you have to be cautious about giving discounts,. Follow this example: you have an item that costs you $100, normally marked up by 30 per cent. That makes it $130. Being the January sales, you cut the price by 20 per cent, to $104.
Now, in order to make as much as the original profit, you'll have to sell seven times more items - and still only make $28.
If you're in business, you can't be lazy about thinking through the sums. You have to know precisely the value of an item you are selling and the true cost of discounts.
Now the public find maths a strain they were glad to leave behind after school, which is fortunate for many retailers who often create illusions of generosity while giving away very little.
Take the example of selling jeans. Say you find some belts that only cost two dollars each, in quantity from China. Instead of cutting the price by 10 or 20 dollars, you add a "free fashion belt". You have increased the perceived value of the purchase - but kept most of your profit margin.
Now you're using discounting to increase your sales, keeping money in your pocket, and not infuriating the customers.
ray@ebeatty.com
16 January, 2010
How to write a job letter that will get you a job
Melbourne Herald Sun, 16th January, 2010
It's the beginning of the year and those who run advertising agencies are receiving the letters they hate. Like, "Dear Sir/Madam, I have just completed my BA in literature and commerce, and am seeking a position as a copywriter within an advertising organisation such as yours....bla bla bla...." You send back a polite letter explaining that we have very few opportunities for trainee staff but wish them the best of luck in their quest.
Personally, what I wanted to do was grab the writer by his or her collar and give them a good shake: "Listen you twit! You are writing the single most important letter of your life. This letter will set the course for your future: what your job will be, the money you'll earn, the enjoyment of your career, the fulfilment of your creativity. Why are you writing like this was a minor clerical position in Australia Post?"
I don't know who teaches our young people to write job applications but quite honestly they have not got a clue. Finding a first job is always a desperately tough assignment. The job market is intensely competitive, and nowhere more so than in a so-called 'glamourous' industry like marketing.
There are a hundred qualified applicants for every job and you have to really stand out if you even want to make it to first base. You=re never going to do that with a boring form letter.
A job letter is a piece of advertising. If you don't win the reader in the first couple of sentences the chances are you'll lose them forever. That intro paragraph has to grab, it has to have emotion, some compulsion. It has to make the reader want more.
If the letter had said: "Just imagine one paragraph of copy which is so exciting, so stimulating, that it can overturn all objections to buying your product. Or picture a commercial which works so compellingly that stores are stampeded by customers demanding the product. I can write like that, and I can do it for your clients."
Sure, nine times out of ten that letter will still end up in the waste bin, but the 10th time somebody will say, "I'd like to see what a kid this audacious could look like." And if you sent out 50 of those letters, well you'd stand a good chance of talking yourself into a job. With the pro-forma letter you could send out a hundred and be lucky to get a single interview.
A job application is an advertisement. See yourself as the product, the gee-whizz solvent with added enzymes that's going to dissolve all of the reader's problems. Like any advertisement, it will compete in a cluttered marketplace: laid side-by-side against others with higher marks, more experience, a lot of advantage points. You have to score a few aces if you hope to win.
Luckily most of us are now well past that first job letter. But the same principles apply. Many of the letters you write are important, they have to be advertisements for themselves. Don't ever make the mistake of thinking that an ad is just the midnight commercial for carrot cutters or the mumsy type with her margarine sandwich.
Advertising is also the proposal you are writing to persuade your board to increase your budget. It's the letter you're sending to plead with the council over the unfair parking fine. Underneath, so much of what we write is pure advertising. And its success will depend on the first few words.
ray@ebeatty.com
It's the beginning of the year and those who run advertising agencies are receiving the letters they hate. Like, "Dear Sir/Madam, I have just completed my BA in literature and commerce, and am seeking a position as a copywriter within an advertising organisation such as yours....bla bla bla...." You send back a polite letter explaining that we have very few opportunities for trainee staff but wish them the best of luck in their quest.
Personally, what I wanted to do was grab the writer by his or her collar and give them a good shake: "Listen you twit! You are writing the single most important letter of your life. This letter will set the course for your future: what your job will be, the money you'll earn, the enjoyment of your career, the fulfilment of your creativity. Why are you writing like this was a minor clerical position in Australia Post?"
I don't know who teaches our young people to write job applications but quite honestly they have not got a clue. Finding a first job is always a desperately tough assignment. The job market is intensely competitive, and nowhere more so than in a so-called 'glamourous' industry like marketing.
There are a hundred qualified applicants for every job and you have to really stand out if you even want to make it to first base. You=re never going to do that with a boring form letter.
A job letter is a piece of advertising. If you don't win the reader in the first couple of sentences the chances are you'll lose them forever. That intro paragraph has to grab, it has to have emotion, some compulsion. It has to make the reader want more.
If the letter had said: "Just imagine one paragraph of copy which is so exciting, so stimulating, that it can overturn all objections to buying your product. Or picture a commercial which works so compellingly that stores are stampeded by customers demanding the product. I can write like that, and I can do it for your clients."
Sure, nine times out of ten that letter will still end up in the waste bin, but the 10th time somebody will say, "I'd like to see what a kid this audacious could look like." And if you sent out 50 of those letters, well you'd stand a good chance of talking yourself into a job. With the pro-forma letter you could send out a hundred and be lucky to get a single interview.
A job application is an advertisement. See yourself as the product, the gee-whizz solvent with added enzymes that's going to dissolve all of the reader's problems. Like any advertisement, it will compete in a cluttered marketplace: laid side-by-side against others with higher marks, more experience, a lot of advantage points. You have to score a few aces if you hope to win.
Luckily most of us are now well past that first job letter. But the same principles apply. Many of the letters you write are important, they have to be advertisements for themselves. Don't ever make the mistake of thinking that an ad is just the midnight commercial for carrot cutters or the mumsy type with her margarine sandwich.
Advertising is also the proposal you are writing to persuade your board to increase your budget. It's the letter you're sending to plead with the council over the unfair parking fine. Underneath, so much of what we write is pure advertising. And its success will depend on the first few words.
ray@ebeatty.com
31 December, 2009
In Bali, the price of happiness is $100
Melbourne Herald Sun, 31st December, 2009
The lake in the mouth of the volcano Gunung Batur in the Balinese highlands is one of the most beautiful places on earth. At the hot spring that feeds the the waters from the active lava far below, I met an attractive Balinese girl who spoke a little English and became my tour guide for an hour or two.
I learned she was in her mid-twenties with four children. Her husband painted traditional pictures that she tried to sell me but I wasn’t in the market - the quality was not very good anyway.
She proudly told me two of the children were at school already and doing well. Perhaps they could escape the wheel of poverty that trapped her.
“I no read or write so I cannot get job in hotel, even in shop,” she explained, so they lived a hand to mouth struggle, in Paradise.
Her great ambition was if she and her husband found work, maybe between them they could earn a million rupiah a month. Then their troubles would be over.
I did a mental calculation. $25 a week. The difference between poverty and happiness for a family of six.
The few dollars’ tip I paid her would feed them for a few days but it was not the answer to third world poverty. But without the 300,000 Australian tourists a year the islanders would be in far worse shape - as revealed when the Bali bombings devastated the industry in 2002.
At this time of year, when we open our minds to peace on earth and the welfare of mankind, let’s think about what we, the cushioned, turkey-fed rich folk, can do for the developing world. And the most effective answer is business.
Tourism has become the major earner for the pretty places on earth - it’s a kind of beauty contest isn’t it? But even more important would be the opportunity for them to trade fairly with the wealthy world.
One organisation that has emerged is Fairtrade. It promotes the importation of produce like
coffee, cocoa, tea, cotton and handicrafts from poor countries like Angola, Nicaragua, East Timor and Thailand. It ensures that the producers get a fair price for the produce and helps them towards stability and self-sufficiency.
The movement is starting to develop traction. This year both BP and McDonalds have been promoting their “green” coffee. Last year Fairtrade claimed worldwide sales of $4.5 billion, and say they are benefitting 7.5 million producers and their families. Of course on a planet of six billion people that’s barely scratching the surface.
Wherever you travel in the developing world you will see the small businesses run by women. Mothers, grandmothers, girls, squatting behind a pile of vegetables or a stack of baskets or at a stand serving curry and rice off banana leaves.
Women like these make up the more than eight million borrowers of the Grameen Bank throughout Asia, Africa and South America. Professor Muhammad Yunus discovered, over 30 years ago, that poor people have enterprise, skills and intelligence - what they don’t have is the tiny amount of capital that allows them to establish a business without falling into grinding debt.
So he established what became the Grameen Bank to lend the small money and teach some basic rules of business and money management. Today the bank operates in 43 countries and has over eight billion dollars out on loan. Their repayment rate is over 98 per cent.
There are answers to world poverty and they start with us, the fortunate ones, helping them to help themselves. It needn’t take much, just examining the labels on produce before we buy. But if I were you I’d tack that on my list of new year’s resolutions.
Ray@ebeatty.com
The lake in the mouth of the volcano Gunung Batur in the Balinese highlands is one of the most beautiful places on earth. At the hot spring that feeds the the waters from the active lava far below, I met an attractive Balinese girl who spoke a little English and became my tour guide for an hour or two.
I learned she was in her mid-twenties with four children. Her husband painted traditional pictures that she tried to sell me but I wasn’t in the market - the quality was not very good anyway.
She proudly told me two of the children were at school already and doing well. Perhaps they could escape the wheel of poverty that trapped her.
“I no read or write so I cannot get job in hotel, even in shop,” she explained, so they lived a hand to mouth struggle, in Paradise.
Her great ambition was if she and her husband found work, maybe between them they could earn a million rupiah a month. Then their troubles would be over.
I did a mental calculation. $25 a week. The difference between poverty and happiness for a family of six.
The few dollars’ tip I paid her would feed them for a few days but it was not the answer to third world poverty. But without the 300,000 Australian tourists a year the islanders would be in far worse shape - as revealed when the Bali bombings devastated the industry in 2002.
At this time of year, when we open our minds to peace on earth and the welfare of mankind, let’s think about what we, the cushioned, turkey-fed rich folk, can do for the developing world. And the most effective answer is business.
Tourism has become the major earner for the pretty places on earth - it’s a kind of beauty contest isn’t it? But even more important would be the opportunity for them to trade fairly with the wealthy world.
One organisation that has emerged is Fairtrade. It promotes the importation of produce like
coffee, cocoa, tea, cotton and handicrafts from poor countries like Angola, Nicaragua, East Timor and Thailand. It ensures that the producers get a fair price for the produce and helps them towards stability and self-sufficiency.
The movement is starting to develop traction. This year both BP and McDonalds have been promoting their “green” coffee. Last year Fairtrade claimed worldwide sales of $4.5 billion, and say they are benefitting 7.5 million producers and their families. Of course on a planet of six billion people that’s barely scratching the surface.
Wherever you travel in the developing world you will see the small businesses run by women. Mothers, grandmothers, girls, squatting behind a pile of vegetables or a stack of baskets or at a stand serving curry and rice off banana leaves.
Women like these make up the more than eight million borrowers of the Grameen Bank throughout Asia, Africa and South America. Professor Muhammad Yunus discovered, over 30 years ago, that poor people have enterprise, skills and intelligence - what they don’t have is the tiny amount of capital that allows them to establish a business without falling into grinding debt.
So he established what became the Grameen Bank to lend the small money and teach some basic rules of business and money management. Today the bank operates in 43 countries and has over eight billion dollars out on loan. Their repayment rate is over 98 per cent.
There are answers to world poverty and they start with us, the fortunate ones, helping them to help themselves. It needn’t take much, just examining the labels on produce before we buy. But if I were you I’d tack that on my list of new year’s resolutions.
Ray@ebeatty.com
19 December, 2009
Has the internet killed the Christmas card?
Melbourne Herald Sun, 19th December 2009
The other day I heard a comment in trendy Albert Park. Two mid-30s yummy mummies catching up over their soy lattes. “I just haven’t had a minute to send out the Christmas cards this year.” “Same here - it’s going to be emails again like last year.” They nodded in agreement.
Eavesdropping from the next table, my reaction was: “Thank goodness - I’m not the only one.” Yes I’m afraid my friends and extended family - as opposed to immediate family who have been carded and gifted already - will receive their warm, heartfelt greetings. But without the postage stamp.
Over this decade, as the internet has grown from strength to strength, the world has seen a decline in Christmas cards.
In Britain the number of festive cards bought in shops has dropped by 20 million in the past two years. Even more worrying, a recent survey showed that 40 per cent of the under-35s have given up the card habit.
In America the number of Christmas cards received in the average home dropped from 29 in 1987, to 20 in 2004. Latest figures indicate that the decline is continuing.
The ever-sunny Australia Post PR machine assures us that in fact nothing has changed. Just a few weeks age they announced that AP expects to deliver 470 million mail articles across Australia, up from 450 million in 2006. But are they Christmas cards I wonder? They are certainly not coming to my letter box, how about yours?
The post office and Christmas cards have always been linked. The first commercial cards were produced in London in 1843 by Sir Henry Cole - one of the creators of the Penny Post three years earlier, the foundation of all the world’s postal services.
For a century and a half the cards flourished as a form of social massage for the human family. Even if you only met with your cousin once every ten years, you could be guaranteed to exchange cards every Christmas. It said “I know you’re there and I still care for you”.
Modern communications have changed all that. Your cousin knows you are here because every few weeks you share a dirty joke with him and your friends in your emails. Girls now have cordless and mobile phones so they can have long chats with their girlfriends while they make the beds or cook the dinner (how does my wife do that? I am in wonder at her multi-skilling). And Skype means that even interstate or overseas friends can stay in the circle for a low cost.
In Britain again, they estimate that email cards are growing by 200 per cent a year. There are now thousands of card services on line which allow you to email all your friends and customers, and others that will produce and individualise cards from your mailing list, with your message, and send out the cards in the mail.
Of course all the Scrooges have lots of good excuses. Cards are too expensive, postage is exorbitant, a postal strike could stop them arriving, they are environmentally damaging both in production and disposal, and who has got time between job and home and kids and preparing for Christmas - to sit down and write cards?
But there is something a little sad about a barren dresser with just a few cards from your parents and aged aunts to show it is Christmas.
Well let me take this opportunity to thank you, my loyal reader, for sticking with me all year. This is my Christmas card to you, if you wish you may clip it out and place it on the mantlepiece. And do have a VERY MERRY CHRISTMAS! Cheers - Ray.
Ray@ebeatty.com
The other day I heard a comment in trendy Albert Park. Two mid-30s yummy mummies catching up over their soy lattes. “I just haven’t had a minute to send out the Christmas cards this year.” “Same here - it’s going to be emails again like last year.” They nodded in agreement.
Eavesdropping from the next table, my reaction was: “Thank goodness - I’m not the only one.” Yes I’m afraid my friends and extended family - as opposed to immediate family who have been carded and gifted already - will receive their warm, heartfelt greetings. But without the postage stamp.
Over this decade, as the internet has grown from strength to strength, the world has seen a decline in Christmas cards.
In Britain the number of festive cards bought in shops has dropped by 20 million in the past two years. Even more worrying, a recent survey showed that 40 per cent of the under-35s have given up the card habit.
In America the number of Christmas cards received in the average home dropped from 29 in 1987, to 20 in 2004. Latest figures indicate that the decline is continuing.
The ever-sunny Australia Post PR machine assures us that in fact nothing has changed. Just a few weeks age they announced that AP expects to deliver 470 million mail articles across Australia, up from 450 million in 2006. But are they Christmas cards I wonder? They are certainly not coming to my letter box, how about yours?
The post office and Christmas cards have always been linked. The first commercial cards were produced in London in 1843 by Sir Henry Cole - one of the creators of the Penny Post three years earlier, the foundation of all the world’s postal services.
For a century and a half the cards flourished as a form of social massage for the human family. Even if you only met with your cousin once every ten years, you could be guaranteed to exchange cards every Christmas. It said “I know you’re there and I still care for you”.
Modern communications have changed all that. Your cousin knows you are here because every few weeks you share a dirty joke with him and your friends in your emails. Girls now have cordless and mobile phones so they can have long chats with their girlfriends while they make the beds or cook the dinner (how does my wife do that? I am in wonder at her multi-skilling). And Skype means that even interstate or overseas friends can stay in the circle for a low cost.
In Britain again, they estimate that email cards are growing by 200 per cent a year. There are now thousands of card services on line which allow you to email all your friends and customers, and others that will produce and individualise cards from your mailing list, with your message, and send out the cards in the mail.
Of course all the Scrooges have lots of good excuses. Cards are too expensive, postage is exorbitant, a postal strike could stop them arriving, they are environmentally damaging both in production and disposal, and who has got time between job and home and kids and preparing for Christmas - to sit down and write cards?
But there is something a little sad about a barren dresser with just a few cards from your parents and aged aunts to show it is Christmas.
Well let me take this opportunity to thank you, my loyal reader, for sticking with me all year. This is my Christmas card to you, if you wish you may clip it out and place it on the mantlepiece. And do have a VERY MERRY CHRISTMAS! Cheers - Ray.
Ray@ebeatty.com
05 December, 2009
Mo’s and red noses chase charity dollars
Melbourne Herald Sun 5th December 2009
When my friend emailed me his photo it gave me a shock. Phillip had grown a big black moustache, and being of Greek descent he looked like some Balkan brigand rather than a mild-mannered corporate lawyer.
The reason, he explained, was Movember. He and many others in his firm had spent last month cultivating their lip-muffs in the aid of a charity, the Movember Foundation, established in Melbourne in 2004 to raise funds for Prostate Cancer Australia and Beyond Blue.
The idea has since spread around the world including the US, Canada and Ireland. It is claimed to have raised over $50 million in this time.
Now that’s a fast growth rate for a new charity in a world filled with good causes. It has all been done because of a gimmick and points out that a successful charity needs a smart angle.
It’s all about visibility, you have to be seen and remembered. Take Red Nose Day. Started in Britain in 1985 it came to Australia in 1988 where it has become a major fund-raiser, initially for SIDS and since then for a number of Australia-Pacific charities. In the US it puts on a huge telethon hosted by comedians like Robin Williams, Billy Crystal, and Whoopi Goldberg.
One of the most successful gimmicks has been Pink Ribbon Month by the National Breast Cancer Foundation. First given out in New York City in 1991, the cloth slips have become a world-wide industry engaged with the likes of Estee Lauder, Avon, and a huge range of products that market themselves with ribbons in exchange for a licence fee.
This has in turn led to criticism. Some have said that the sea of pink has terrified women beyond the reality of breast cancer’s threat. Others have coined the term slacktivism - “the desire people have to do something good without getting out of their chair.” There are also unscrupulous companies that have snuck in to market “Pink Ribbon” products - with no return to the charity.
But all the criticism doesn’t get around the fact that gimmicks work. Daffodil Day for the Cancer Council was invented in Canada in the early 1980s and now has spread world-wide. In Australia alone it raises $8 million every August.
Jeans for Genes Day is when all the office workers go to town in their jeans and contribute to a charity for the Children’s Medical Research Institute. Another visible, simple, very successful gimmick. It was started in Dorset, UK, in 1996 where this year it raised some $6 million for the Great Ormond Street Children’s Hospital in London.
Our own Children’s Hospital relies on its Good Friday Appeal that, funny to say, was started in 1931 by a bunch of journalists from the Herald & Weekly Times, who organised a sporting carnival in aid of charity.
But of course the most famous and world-recognised charity symbol is the red poppy, adopted after World War I by the British Legion ex-servicemen’s charity and quickly picked up by the RSL and and equivalent organisations.
Taken from the poem In Flanders Field which described the red poppies growing amongst white crosses on the battleground that saw the deaths of so many young men, it remains a simple and vivid symbol for the charities.
So if you have a charity to promote, take out your poppy and daffodil, don your red nose and pink ribbon, finger your luxuriant moustache (women may be excused) and think of a brand new gimmick.
ray@ebeatty.com
When my friend emailed me his photo it gave me a shock. Phillip had grown a big black moustache, and being of Greek descent he looked like some Balkan brigand rather than a mild-mannered corporate lawyer.
The reason, he explained, was Movember. He and many others in his firm had spent last month cultivating their lip-muffs in the aid of a charity, the Movember Foundation, established in Melbourne in 2004 to raise funds for Prostate Cancer Australia and Beyond Blue.
The idea has since spread around the world including the US, Canada and Ireland. It is claimed to have raised over $50 million in this time.
Now that’s a fast growth rate for a new charity in a world filled with good causes. It has all been done because of a gimmick and points out that a successful charity needs a smart angle.
It’s all about visibility, you have to be seen and remembered. Take Red Nose Day. Started in Britain in 1985 it came to Australia in 1988 where it has become a major fund-raiser, initially for SIDS and since then for a number of Australia-Pacific charities. In the US it puts on a huge telethon hosted by comedians like Robin Williams, Billy Crystal, and Whoopi Goldberg.
One of the most successful gimmicks has been Pink Ribbon Month by the National Breast Cancer Foundation. First given out in New York City in 1991, the cloth slips have become a world-wide industry engaged with the likes of Estee Lauder, Avon, and a huge range of products that market themselves with ribbons in exchange for a licence fee.
This has in turn led to criticism. Some have said that the sea of pink has terrified women beyond the reality of breast cancer’s threat. Others have coined the term slacktivism - “the desire people have to do something good without getting out of their chair.” There are also unscrupulous companies that have snuck in to market “Pink Ribbon” products - with no return to the charity.
But all the criticism doesn’t get around the fact that gimmicks work. Daffodil Day for the Cancer Council was invented in Canada in the early 1980s and now has spread world-wide. In Australia alone it raises $8 million every August.
Jeans for Genes Day is when all the office workers go to town in their jeans and contribute to a charity for the Children’s Medical Research Institute. Another visible, simple, very successful gimmick. It was started in Dorset, UK, in 1996 where this year it raised some $6 million for the Great Ormond Street Children’s Hospital in London.
Our own Children’s Hospital relies on its Good Friday Appeal that, funny to say, was started in 1931 by a bunch of journalists from the Herald & Weekly Times, who organised a sporting carnival in aid of charity.
But of course the most famous and world-recognised charity symbol is the red poppy, adopted after World War I by the British Legion ex-servicemen’s charity and quickly picked up by the RSL and and equivalent organisations.
Taken from the poem In Flanders Field which described the red poppies growing amongst white crosses on the battleground that saw the deaths of so many young men, it remains a simple and vivid symbol for the charities.
So if you have a charity to promote, take out your poppy and daffodil, don your red nose and pink ribbon, finger your luxuriant moustache (women may be excused) and think of a brand new gimmick.
ray@ebeatty.com
28 November, 2009
Money-sucking vampires bite teenage girls
Melbourne Herald Sun, 28 November, 2009
The spectacular success of this week’s money-sucking vampires just goes to show that teenage girls still go gaga at handsome, pale skinned, sexually dangerous young men. And their boyfrends are happy to take them along to the movies in the hope of receiving some of the transferred arousal afterwards.
The Twilight Saga: New Moon serves to remind us that there is plenty of financial clout tucked into the pockets of teenagers’ jeans. The opening weekend pulled $16 million, leapfrogging the biggest-opening Harry Potter films by two million.
In North America it pulled $150 million - huge, but which is actually a lot less than here, on a per-head basis. In the UK, where Twilight fever is equally manic, the first weekend scored $20 million - again much less than Oz when you count the heads. Here we managed to take over a quarter of the country’s cinema screens to satisfy the were-wolf frenzy of the fans.
Teen passions have always been a market driver since before the time of the yo-yo and the hoola hoop. Harry Potter showed how a wizardly schoolyard tale can be as engulfing now as The Wizard of Oz was in great-grandma’s day. And with the addition of endless merchandising - yes there’s already a Barbie Twilight Edward doll - the loot can more than double the theatre takings.
Advertisers watch these fads very closely because such passions can give them an inroad to that difficult-to-penetrate territory, the teenage mind.
We know that among 12-24 year olds TV viewing is at its lowest. Teens watch 50 per cent less TV than their parents. At school they are taught to never accept advertising at its face value, and this justifies their natural suspicion of grown-ups selling them things.
This distrust extends to what they read in advertising on the internet. After years of being exposed to dubious medical promises that they can barely understand, who can blame them?
For the girls there are their teen magazines - against an ebb tide for magazines in general and women’s magazines especially, the ever pink and bubbly Dolly has managed to increase its circulation by four per cent. Celebrities are still big, with the latest Who Did What to Whom mag, Famous, climbing by 20 per cent.
Boys are left out in the wilderness. The only recent attempt to give them a teen magazine, Explode, in fact imploded after a mere eight months. If their hoodies and sunnies make them look hard to penetrate, that’s because they are.
So maybe the answer is screen advertising. The multiplex is the one place where you are guaranteed to meet swarms of teenagers. And there’s no fad like a movie fad.
On You-Tube worldwide interviews show girls, surrounded by obligatory girlfriends and a couple of token boys, clutching each other and swearing they thought they would die when Taylor Lautner took his shirt off. And each claimed to be the very first in her school to see the movie after queuing for most of the night.
Screen advertising has long been the poor relation at the media feast. But right now things are looking pretty good.
Paul Butler is Managing Director of Val Morgan, Australia’s leading cinema advertising network. Naturally enough, he has a smile on his face this week. “This year’s box office is running 16 per cent higher than last,” he said. “We’re very likely to top the $1 billion mark this year.”
With Christmas approaching, life is looking good on the axminster carpets. “Christmas is always a boom time,” he adds, and in just three weeks we’ll see the release of Avatar, another guaranteed blockbuster.
So if you plan to spend any Christmas time with teenage kids, I hope you like popcorn.
Ray@ebeatty.com
END
The spectacular success of this week’s money-sucking vampires just goes to show that teenage girls still go gaga at handsome, pale skinned, sexually dangerous young men. And their boyfrends are happy to take them along to the movies in the hope of receiving some of the transferred arousal afterwards.
The Twilight Saga: New Moon serves to remind us that there is plenty of financial clout tucked into the pockets of teenagers’ jeans. The opening weekend pulled $16 million, leapfrogging the biggest-opening Harry Potter films by two million.
In North America it pulled $150 million - huge, but which is actually a lot less than here, on a per-head basis. In the UK, where Twilight fever is equally manic, the first weekend scored $20 million - again much less than Oz when you count the heads. Here we managed to take over a quarter of the country’s cinema screens to satisfy the were-wolf frenzy of the fans.
Teen passions have always been a market driver since before the time of the yo-yo and the hoola hoop. Harry Potter showed how a wizardly schoolyard tale can be as engulfing now as The Wizard of Oz was in great-grandma’s day. And with the addition of endless merchandising - yes there’s already a Barbie Twilight Edward doll - the loot can more than double the theatre takings.
Advertisers watch these fads very closely because such passions can give them an inroad to that difficult-to-penetrate territory, the teenage mind.
We know that among 12-24 year olds TV viewing is at its lowest. Teens watch 50 per cent less TV than their parents. At school they are taught to never accept advertising at its face value, and this justifies their natural suspicion of grown-ups selling them things.
This distrust extends to what they read in advertising on the internet. After years of being exposed to dubious medical promises that they can barely understand, who can blame them?
For the girls there are their teen magazines - against an ebb tide for magazines in general and women’s magazines especially, the ever pink and bubbly Dolly has managed to increase its circulation by four per cent. Celebrities are still big, with the latest Who Did What to Whom mag, Famous, climbing by 20 per cent.
Boys are left out in the wilderness. The only recent attempt to give them a teen magazine, Explode, in fact imploded after a mere eight months. If their hoodies and sunnies make them look hard to penetrate, that’s because they are.
So maybe the answer is screen advertising. The multiplex is the one place where you are guaranteed to meet swarms of teenagers. And there’s no fad like a movie fad.
On You-Tube worldwide interviews show girls, surrounded by obligatory girlfriends and a couple of token boys, clutching each other and swearing they thought they would die when Taylor Lautner took his shirt off. And each claimed to be the very first in her school to see the movie after queuing for most of the night.
Screen advertising has long been the poor relation at the media feast. But right now things are looking pretty good.
Paul Butler is Managing Director of Val Morgan, Australia’s leading cinema advertising network. Naturally enough, he has a smile on his face this week. “This year’s box office is running 16 per cent higher than last,” he said. “We’re very likely to top the $1 billion mark this year.”
With Christmas approaching, life is looking good on the axminster carpets. “Christmas is always a boom time,” he adds, and in just three weeks we’ll see the release of Avatar, another guaranteed blockbuster.
So if you plan to spend any Christmas time with teenage kids, I hope you like popcorn.
Ray@ebeatty.com
END
21 November, 2009
Entice them with the carrot, beat them with the stick
Melbourne Herald Sun, 21 November, 2009
Earlier this year the Government spent $42 billion to give large numbers of citizens $900 grants so they may spend money and therefore stimulate our flagging economy.
But in fact they already have a mechanism that dangles carrots before the public snouts, egging them on the spend money and participate in our economy. This system not only pays for itself, it even contributes taxes to the government coffers. It’s called advertising.
Yes advertising dangles the lure that makes you get up in the morning, and work to earn enough to buy the next new car or mega-TV. It urges you to brush your teeth and dress in style, it makes the children eat their cereals and the adults disinfect their bathrooms.
If the economy was a Bruce Petty cartoon carthorse, at the rear would be the prodding pitchforks and cracking whips of hunger and homelessness while at the front would be the dangled carrots and fruits of the advertising promise.
But then you walk down your high street and see lumbering overweight adults and kids. Aha, you think, too much carrot. But is the answer to jump on the advertising industry for over-stimulating, or is the problem more complex than that?
This week the ad folks have made another move to improve their self-regulation. The Advertising Federation of Australia, which represents the agency managements, has merged with the Australian Writers and Art Directors Association which represents the ‘creative’ side of the business. They will now be called The Communication Council.
A major objective of the new body will be to keep the encroaching censors at bay. Labor governments have always been filled with public advocates and lawyers who want to tell everybody else what to do. And advertising is always an easy target for the reformers.
Sure enough, Health Minister Nicola Roxon formed the National Preventive Health Taskforce early in her reign, who have recently reported back. One recommendation waved a red flag at the advertisers: “Reduce exposure of children and others to marketing, advertising, promotion and sponsorship of energy-dense, nutrient-poor foods and beverages.” For which read: “fast-foods, sweets and soft drinks”.
And if they don’t respond to the whip crack, “Introduce legislation if these measures are not effective.” This is what the advertisers are scared of. For many years they have been able to persuade governments of all colours to let them self-regulate.
The Advertising Standards Bureau is the main tool they use. This is the body you turn to when you feel offended by a poster offering “longer sex”. They gather in all the complaints about sexist detergent ads or stick to your ribs double-whopper-burger ads in children’s shows, and make a ruling.
The reformists object because those rules were written by the agencies themselves. But recent research reported that the bureau’s judgements were pretty much in line with public perceptions, while many objections were seen by Joe Public as being a bit over the top.
There are 20 members on the judging panel including figures like Natasha Stott Despoja, Thomas Keneally, and actress Sibylla Budd. Not exactly tools of capitalism.
The ASB promises that it will re-examine its regulations and hold more meetings. Many more complaints are examined these days and last year they forced the withdrawal or amendment of 15 per cent of the ads brought before them.
But I have to confess to a lack of shock at any of the ads we see. Compared to the language on television dramas, or the careless wolfing down of fast foods you see in the street every day, commercials present a chocolate-box world.
Ray@ebeatty.com
Earlier this year the Government spent $42 billion to give large numbers of citizens $900 grants so they may spend money and therefore stimulate our flagging economy.
But in fact they already have a mechanism that dangles carrots before the public snouts, egging them on the spend money and participate in our economy. This system not only pays for itself, it even contributes taxes to the government coffers. It’s called advertising.
Yes advertising dangles the lure that makes you get up in the morning, and work to earn enough to buy the next new car or mega-TV. It urges you to brush your teeth and dress in style, it makes the children eat their cereals and the adults disinfect their bathrooms.
If the economy was a Bruce Petty cartoon carthorse, at the rear would be the prodding pitchforks and cracking whips of hunger and homelessness while at the front would be the dangled carrots and fruits of the advertising promise.
But then you walk down your high street and see lumbering overweight adults and kids. Aha, you think, too much carrot. But is the answer to jump on the advertising industry for over-stimulating, or is the problem more complex than that?
This week the ad folks have made another move to improve their self-regulation. The Advertising Federation of Australia, which represents the agency managements, has merged with the Australian Writers and Art Directors Association which represents the ‘creative’ side of the business. They will now be called The Communication Council.
A major objective of the new body will be to keep the encroaching censors at bay. Labor governments have always been filled with public advocates and lawyers who want to tell everybody else what to do. And advertising is always an easy target for the reformers.
Sure enough, Health Minister Nicola Roxon formed the National Preventive Health Taskforce early in her reign, who have recently reported back. One recommendation waved a red flag at the advertisers: “Reduce exposure of children and others to marketing, advertising, promotion and sponsorship of energy-dense, nutrient-poor foods and beverages.” For which read: “fast-foods, sweets and soft drinks”.
And if they don’t respond to the whip crack, “Introduce legislation if these measures are not effective.” This is what the advertisers are scared of. For many years they have been able to persuade governments of all colours to let them self-regulate.
The Advertising Standards Bureau is the main tool they use. This is the body you turn to when you feel offended by a poster offering “longer sex”. They gather in all the complaints about sexist detergent ads or stick to your ribs double-whopper-burger ads in children’s shows, and make a ruling.
The reformists object because those rules were written by the agencies themselves. But recent research reported that the bureau’s judgements were pretty much in line with public perceptions, while many objections were seen by Joe Public as being a bit over the top.
There are 20 members on the judging panel including figures like Natasha Stott Despoja, Thomas Keneally, and actress Sibylla Budd. Not exactly tools of capitalism.
The ASB promises that it will re-examine its regulations and hold more meetings. Many more complaints are examined these days and last year they forced the withdrawal or amendment of 15 per cent of the ads brought before them.
But I have to confess to a lack of shock at any of the ads we see. Compared to the language on television dramas, or the careless wolfing down of fast foods you see in the street every day, commercials present a chocolate-box world.
Ray@ebeatty.com
14 November, 2009
How the Internet made them rich
Melbourne Herald Sun 14th November, 2009
There’s a formula to making millions in a hurry. It’s simple and quick, and there are many thousands doing it right now all around the world but particularly in the US.
We saw it this week with the headline: “Google buys AdMob for $800 million". Obviously you’ve heard of Google but probably not AdMob. So what do they do that makes them worth nearly a billion bucks?
In mythology get-rich-quick stories were like Jack climbing the beanstalk, geese laying golden eggs or Cinderella sparking the lust of a young prince. These days they tend to start at Stanford or Harvard or Oxford.
In this case it was the University of Pennsylvania where, less than four years ago, a young MBA student called Omar Hamoui had a bright idea.
Mobile phone applications were beginning to take off as the technology became increasingly sophisticated. So sites would emerge where you could go to select ring tones, get the weather, book movie tickets and the like.
These sites would make extra revenue through banner ads on the screen, like happens on the Internet. But the business was very haphazard and disorganised, there was no way to be able to measure the effects of your ads or create big enough targets to attract major brands.
Having started and run several companies on this mobile market, Hamoui understood the problems - and worked out how to fix them. In January 2006 he started AdMob as a media coordinator that brought together the providers, the advertisers, their agencies, and the audience.
So take the example of Land Rover. They could target a high-income male audience that browsed sites featuring sports utility vehicles. The viewer could then click through to pictures of the car range where the company would offer them test drives and put them in contact with the nearest dealers.
By bringing together thousands of such sites AdMob could assemble and manage a well-documented advertising package that would speak to corporations and advertising agencies in terms they could relate to.
Within a year they attracted the attention of one of Silicon Valley’s biggest venture capitalists, Accel. A list of Accel’s success stories says it all: Facebook, BitTorrent, Uunet, and many more. They find a good, successful idea, pour money and management into it, and make it huge.
The venture capitalists themselves are often funded by citizen investors. Mums and dads and retirees who don’t trust their whole nest-egg to the superannuation funds. Any week of the year you can find conferences and introductory nights by the likes of Australian Venture Capital Association, Business Angels, Venture Capital Marketplace and many more.
They have their get-rich-quick rulebook too. Make sure the business is successful and profitable, take a big slice of the equity (at which point the developer will usually go into a decision crisis - does he really want to invite this cuckoo into his nest?) and quickly fatten it for market, ideally within three years.
The good ones do it well. Accel invested $17 million and helped AdMob grow into the world’s biggest mobile advertising platform in two years, turning over more than $100 million a year. And so attractive that Google was willing to pay a fortune to take it into its fold, rather than have to compete with it. So far it looks like the company will be left intact with the same management in charge. So expect to see a few more Ferraris on the roads of northern California.
Another Accel money spinner, Playfish, sold this week for $303 million to Electronic Arts. This was from an investment of $1 million - in 2008. Who said that magic beans and golden eggs are fairy tales? Aladdin’s cave could be no further away than your mobile phone.
ray@ebeatty.com
There’s a formula to making millions in a hurry. It’s simple and quick, and there are many thousands doing it right now all around the world but particularly in the US.
We saw it this week with the headline: “Google buys AdMob for $800 million". Obviously you’ve heard of Google but probably not AdMob. So what do they do that makes them worth nearly a billion bucks?
In mythology get-rich-quick stories were like Jack climbing the beanstalk, geese laying golden eggs or Cinderella sparking the lust of a young prince. These days they tend to start at Stanford or Harvard or Oxford.
In this case it was the University of Pennsylvania where, less than four years ago, a young MBA student called Omar Hamoui had a bright idea.
Mobile phone applications were beginning to take off as the technology became increasingly sophisticated. So sites would emerge where you could go to select ring tones, get the weather, book movie tickets and the like.
These sites would make extra revenue through banner ads on the screen, like happens on the Internet. But the business was very haphazard and disorganised, there was no way to be able to measure the effects of your ads or create big enough targets to attract major brands.
Having started and run several companies on this mobile market, Hamoui understood the problems - and worked out how to fix them. In January 2006 he started AdMob as a media coordinator that brought together the providers, the advertisers, their agencies, and the audience.
So take the example of Land Rover. They could target a high-income male audience that browsed sites featuring sports utility vehicles. The viewer could then click through to pictures of the car range where the company would offer them test drives and put them in contact with the nearest dealers.
By bringing together thousands of such sites AdMob could assemble and manage a well-documented advertising package that would speak to corporations and advertising agencies in terms they could relate to.
Within a year they attracted the attention of one of Silicon Valley’s biggest venture capitalists, Accel. A list of Accel’s success stories says it all: Facebook, BitTorrent, Uunet, and many more. They find a good, successful idea, pour money and management into it, and make it huge.
The venture capitalists themselves are often funded by citizen investors. Mums and dads and retirees who don’t trust their whole nest-egg to the superannuation funds. Any week of the year you can find conferences and introductory nights by the likes of Australian Venture Capital Association, Business Angels, Venture Capital Marketplace and many more.
They have their get-rich-quick rulebook too. Make sure the business is successful and profitable, take a big slice of the equity (at which point the developer will usually go into a decision crisis - does he really want to invite this cuckoo into his nest?) and quickly fatten it for market, ideally within three years.
The good ones do it well. Accel invested $17 million and helped AdMob grow into the world’s biggest mobile advertising platform in two years, turning over more than $100 million a year. And so attractive that Google was willing to pay a fortune to take it into its fold, rather than have to compete with it. So far it looks like the company will be left intact with the same management in charge. So expect to see a few more Ferraris on the roads of northern California.
Another Accel money spinner, Playfish, sold this week for $303 million to Electronic Arts. This was from an investment of $1 million - in 2008. Who said that magic beans and golden eggs are fairy tales? Aladdin’s cave could be no further away than your mobile phone.
ray@ebeatty.com
31 October, 2009
Did your children really come from another planet?
Melbourne Herald Sun, 31st October, 2009
Did our children really come from another planet - or under all the clothes, the talk, the music are they really little copies of us?
Putting this in business terms, the questions are: does all our expensive advertising appeal in the same way to each generation, do they use the same media, are they even looking?
A recently published report from Luma Research is bound to draw a sigh of relief. Yes they are different - but not that different.
It’ll come as no surprise that the oldies - 45 plus - spend two-thirds more time in front of the TV than a teenager. What is surprising is that they also spend three times more hours on the internet. So what do those teenyboppers get up to when they’re not in sight? Let’s put a good face on it and hope they are attending to their studies.
You can’t accuse the survey of being too narrow. Over 20 years they questioned 240,000 people in 50 countries. Definitely a representative sample.
But what every business person wants to know is: do people even notice my ads? And what is it that makes them buy?
Teens are more aware of advertising than their elders but this does not make them any more responsive. Uniformly, right across the generations, before the consumer will respond to the ad - and buy the product - they have to develop a relationship with it, what the researchers call “bonding”.
They have to like the ad. Respond to it, feel that it is talking to them. If that happens they will be pulled to your product, they will probably buy it. No surprises there - except for those who think that if they scream loudly enough out of the TV, the customer will be bludgeoned into submission.
Certainly different kinds of ads bond in different ways. If they are buying a car and you have the model they want at the price they expect to pay, a line ad in our classified pages will do the trick. It’s purely information. They will also look on the web, in local newspapers - they are just seeking their goal.
But as soon as you start promoting which car they should buy, and how much they ought to spend - then you are getting into image, fashion, relationship. This is where the emotional bonding comes in.
Our gen Zs, the teenagers, like stories and fantasy - not surprising. Their older siblings Gen Y (under 30s) respond to narration ads, telling a more straightforward message in words and pictures. But in the end it all comes down to the quality of the idea behind the ad, and the skill in promoting the benefits, in other words being creative.
This is where too many of the ads you’ll see on tonight’s TV, or in this weekend’s magazines, fall down. Look at them with a critical eye. Do they have personality? Is there any that makes you laugh or yearn or respond? It’s these emotions that create the bond, that make the ad - and the product - your friend.
Even though you and your kids have different reasons for choosing friends, across the generation divide, the mechanism of friendship remains the same. So it is with advertising, underneath we are no different. This is where the execution needs to be lined up with the age group and their concerns and fashions of the day.
But as far as the choice of the internet as an advertising medium, the surprising outcome of this research is that it is far more effective in reaching the Gen X and Baby Boomers (35+) than their kids. It’s mum and dad that are hogging the data line, while the kids go off onto their own planet.
Ray@ebeatty.com
Did our children really come from another planet - or under all the clothes, the talk, the music are they really little copies of us?
Putting this in business terms, the questions are: does all our expensive advertising appeal in the same way to each generation, do they use the same media, are they even looking?
A recently published report from Luma Research is bound to draw a sigh of relief. Yes they are different - but not that different.
It’ll come as no surprise that the oldies - 45 plus - spend two-thirds more time in front of the TV than a teenager. What is surprising is that they also spend three times more hours on the internet. So what do those teenyboppers get up to when they’re not in sight? Let’s put a good face on it and hope they are attending to their studies.
You can’t accuse the survey of being too narrow. Over 20 years they questioned 240,000 people in 50 countries. Definitely a representative sample.
But what every business person wants to know is: do people even notice my ads? And what is it that makes them buy?
Teens are more aware of advertising than their elders but this does not make them any more responsive. Uniformly, right across the generations, before the consumer will respond to the ad - and buy the product - they have to develop a relationship with it, what the researchers call “bonding”.
They have to like the ad. Respond to it, feel that it is talking to them. If that happens they will be pulled to your product, they will probably buy it. No surprises there - except for those who think that if they scream loudly enough out of the TV, the customer will be bludgeoned into submission.
Certainly different kinds of ads bond in different ways. If they are buying a car and you have the model they want at the price they expect to pay, a line ad in our classified pages will do the trick. It’s purely information. They will also look on the web, in local newspapers - they are just seeking their goal.
But as soon as you start promoting which car they should buy, and how much they ought to spend - then you are getting into image, fashion, relationship. This is where the emotional bonding comes in.
Our gen Zs, the teenagers, like stories and fantasy - not surprising. Their older siblings Gen Y (under 30s) respond to narration ads, telling a more straightforward message in words and pictures. But in the end it all comes down to the quality of the idea behind the ad, and the skill in promoting the benefits, in other words being creative.
This is where too many of the ads you’ll see on tonight’s TV, or in this weekend’s magazines, fall down. Look at them with a critical eye. Do they have personality? Is there any that makes you laugh or yearn or respond? It’s these emotions that create the bond, that make the ad - and the product - your friend.
Even though you and your kids have different reasons for choosing friends, across the generation divide, the mechanism of friendship remains the same. So it is with advertising, underneath we are no different. This is where the execution needs to be lined up with the age group and their concerns and fashions of the day.
But as far as the choice of the internet as an advertising medium, the surprising outcome of this research is that it is far more effective in reaching the Gen X and Baby Boomers (35+) than their kids. It’s mum and dad that are hogging the data line, while the kids go off onto their own planet.
Ray@ebeatty.com
17 October, 2009
Big man in media makes millions
Melbourne Herald Sun 17th October, 2009
It was a long time ago I first met Harold Mitchell, at the advertising agency Masius. Little did I suspect that he would one day be both rich and famous.
While I was a junior copywriter, he was only a few years older than me, still in his 20s. But already he had become national media director of one of this country’s leading agencies.
He was as smart as he was big. In board rooms he’d sit quietly as the creatives and account managers pitched a campaign to the clients. His job was to tell them how their money would be spent - on TV, newspapers, billboards - he’d briskly set out the media he would purchase for them, millions of dollars. And while they had lots to say about the ads, these clients said little about where the money would flow, trusting that Harold would buy the most cost-efficient plan.
In 1976 he picked up a new idea from the US. A consultancy specialising just in advertising media, with highly skilled professionals choosing and negotiating the very best media rates for clients, working with them directly or through their own advertising agency.
Naturally the agencies thought it was a terrible idea - this was their source of income after all - but some key advertisers like Just Jeans and Bob Jane liked the flexibility, speed and cost-savings this gave them.
Before long Mitchells were turning over millions of dollars in media billings. Nowadays it’s $1.3 billion which makes him a pretty big customer to the media. No wonder Kerry and Rupert always picked up the phone when he called.
In his recently published book, Living Large, Harold Mitchell doesn’t exactly tell all - but he tells enough about life amongst the millionaires to make it fascinating reading. I wouldn’t call it an autobiography, more what the French call a carnet. Part reminiscence, part anecdotes, part philosophy and history.
It certainly sounds like him. Short, sharp sentences crisply delivering the facts. Don’t expect to find any poetic interludes or intimate romance here. Always the soul of discretion, he tells you enough to pique your interest - but not so much as to be scandalous.
So while he devotes a chapter to Kerry Packer, it’s from the point of view of a friend he looked up to. He’s not so kind about Christopher Skase or Alan Bond.
His regard for Packer is understandable. In the 1987 stockmarket crash he came close to losing it all. The Big Fella tossed him a couple of million dollars, unasked. It was enough to keep the wheels turning till Mitchell could dig himself out of the hole.
He passes these favours on, too. One time a large client of mine suddenly crashed leaving me holding a substantial media debt. It’s the sort of thing that happens in advertising. I told Harold I couldn’t pay him. “So what can you pay?” We worked out a percentage and did the deal on a handshake. Not many blokes like that in today’s business.
It’s indicative of Harold’s political skills that the back of the book has tributes from both Steve Bracks and Jeff Kennett. They both learned that when a job needs to deliver results, he’s the man to call.
He has proved this repeatedly over the past 20 years as Chairman of the National Gallery of Australia, Victorian Museum, and the Melbourne Symphony Orchestra. Just this week I have been missing that entrepreneurial spark that so energised the Melbourne Festival when he was its president.
Masius in the early seventies was a cauldron of talent - author Peter Carey; creators of The Campaign Palace Lionel Hunt and Gordon Trembath; food writer Terry Durack. But none bigger, then as now, than Harold Mitchell.
ray@ebeatty.com
It was a long time ago I first met Harold Mitchell, at the advertising agency Masius. Little did I suspect that he would one day be both rich and famous.
While I was a junior copywriter, he was only a few years older than me, still in his 20s. But already he had become national media director of one of this country’s leading agencies.
He was as smart as he was big. In board rooms he’d sit quietly as the creatives and account managers pitched a campaign to the clients. His job was to tell them how their money would be spent - on TV, newspapers, billboards - he’d briskly set out the media he would purchase for them, millions of dollars. And while they had lots to say about the ads, these clients said little about where the money would flow, trusting that Harold would buy the most cost-efficient plan.
In 1976 he picked up a new idea from the US. A consultancy specialising just in advertising media, with highly skilled professionals choosing and negotiating the very best media rates for clients, working with them directly or through their own advertising agency.
Naturally the agencies thought it was a terrible idea - this was their source of income after all - but some key advertisers like Just Jeans and Bob Jane liked the flexibility, speed and cost-savings this gave them.
Before long Mitchells were turning over millions of dollars in media billings. Nowadays it’s $1.3 billion which makes him a pretty big customer to the media. No wonder Kerry and Rupert always picked up the phone when he called.
In his recently published book, Living Large, Harold Mitchell doesn’t exactly tell all - but he tells enough about life amongst the millionaires to make it fascinating reading. I wouldn’t call it an autobiography, more what the French call a carnet. Part reminiscence, part anecdotes, part philosophy and history.
It certainly sounds like him. Short, sharp sentences crisply delivering the facts. Don’t expect to find any poetic interludes or intimate romance here. Always the soul of discretion, he tells you enough to pique your interest - but not so much as to be scandalous.
So while he devotes a chapter to Kerry Packer, it’s from the point of view of a friend he looked up to. He’s not so kind about Christopher Skase or Alan Bond.
His regard for Packer is understandable. In the 1987 stockmarket crash he came close to losing it all. The Big Fella tossed him a couple of million dollars, unasked. It was enough to keep the wheels turning till Mitchell could dig himself out of the hole.
He passes these favours on, too. One time a large client of mine suddenly crashed leaving me holding a substantial media debt. It’s the sort of thing that happens in advertising. I told Harold I couldn’t pay him. “So what can you pay?” We worked out a percentage and did the deal on a handshake. Not many blokes like that in today’s business.
It’s indicative of Harold’s political skills that the back of the book has tributes from both Steve Bracks and Jeff Kennett. They both learned that when a job needs to deliver results, he’s the man to call.
He has proved this repeatedly over the past 20 years as Chairman of the National Gallery of Australia, Victorian Museum, and the Melbourne Symphony Orchestra. Just this week I have been missing that entrepreneurial spark that so energised the Melbourne Festival when he was its president.
Masius in the early seventies was a cauldron of talent - author Peter Carey; creators of The Campaign Palace Lionel Hunt and Gordon Trembath; food writer Terry Durack. But none bigger, then as now, than Harold Mitchell.
ray@ebeatty.com
12 October, 2009
Student exchange makes the businessman
12th October, 2009
I assume that most of my readers work in some kind of business, and many of you are the parents of children. Maybe you want them to come into your business, or to be successful in their own right. Well I can tell you from my own experience that the best thing to do for them is to send them away.
I discovered this by accident 20 years ago. All I wanted was away to persuade my son to continue his Japanese classes at the end of their first year, when the going got tough and his mates dropped out. “Hang in there and I’ll send you to Japan on exchange,” I promised.
He agreed and two years later, aged 15, set off for Osaka. Fortunately the three years’ Japanese lessons taught him at least how to read the toilet signs at the airport. But from a speech point of view he felt dumb.
He lived with a host family in central Osaka - but none of them spoke English. He travelled an hour and a half each way, by train, to the school. Classes were six days a week, plus two hours’ “club” time each afternoon. Then when he got home, two hours’ homework. Very few people in the school could speak English, but having the agile brain of a teenager he absorbed Japanese like a sponge.
At the end of the exchange year he was perfectly fluent in Japanese - both formal and local dialect - could read and write all three Japanese scripts like a native. He had chosen the school’s Judo Club so by the end of the year he had a black belt and more importantly, his skinny frame had filled out into a muscular, young man.
Did he miss very much? Well I knew from his older sister that Year 10 is not an academically important year. They seemed to spend much of their time on parties, social experiments, and discovering the opposite sex, as they waited for Year 11.
So it was that my boy missed making the front pages when a riot broke out between a large number of his schoolfriends and some gatecrashers. He also wasn’t there when some of his schoolfellows were busted for drugs.
When he returned he was no longer interested in teenage mischief. The Japanese work ethic was so strong that he powered his way through the Baccalaureate. At university the BA in Japanese he did in two years without a strain, and put his efforts into a Bachelor of Commerce.
I first came across exchangers when I worked at an advertising agency in Bangkok. These young executives had spent a year of their teens at school in America or Australia and were the only ones among our local staff who deeply understood western marketing and advertising, and could translate them into a Thai context. In fact the firm would actively seek them out.
So I knew my kid would never be unemployed. Hell, even if the whole world economy collapsed he could still drive a tourist bus. My stepdaughter is a few years older and also exchanged, spending a year in an American high school learning to chew gum and put marshmallows in the salad.
Her mother soon straightened her out that this wasn’t 90210 but the maturing process had done its trick.
She’s now a marketing manager with a world-leading IT company, has a Qantas Club card and takes her husband on overseas luxury holidays on her frequent flyer points.
So, seriously, take a good look at your teenybopper. Maybe the best thing you can do for them is send them away.
ray@ebeatty.com
I assume that most of my readers work in some kind of business, and many of you are the parents of children. Maybe you want them to come into your business, or to be successful in their own right. Well I can tell you from my own experience that the best thing to do for them is to send them away.
I discovered this by accident 20 years ago. All I wanted was away to persuade my son to continue his Japanese classes at the end of their first year, when the going got tough and his mates dropped out. “Hang in there and I’ll send you to Japan on exchange,” I promised.
He agreed and two years later, aged 15, set off for Osaka. Fortunately the three years’ Japanese lessons taught him at least how to read the toilet signs at the airport. But from a speech point of view he felt dumb.
He lived with a host family in central Osaka - but none of them spoke English. He travelled an hour and a half each way, by train, to the school. Classes were six days a week, plus two hours’ “club” time each afternoon. Then when he got home, two hours’ homework. Very few people in the school could speak English, but having the agile brain of a teenager he absorbed Japanese like a sponge.
At the end of the exchange year he was perfectly fluent in Japanese - both formal and local dialect - could read and write all three Japanese scripts like a native. He had chosen the school’s Judo Club so by the end of the year he had a black belt and more importantly, his skinny frame had filled out into a muscular, young man.
Did he miss very much? Well I knew from his older sister that Year 10 is not an academically important year. They seemed to spend much of their time on parties, social experiments, and discovering the opposite sex, as they waited for Year 11.
So it was that my boy missed making the front pages when a riot broke out between a large number of his schoolfriends and some gatecrashers. He also wasn’t there when some of his schoolfellows were busted for drugs.
When he returned he was no longer interested in teenage mischief. The Japanese work ethic was so strong that he powered his way through the Baccalaureate. At university the BA in Japanese he did in two years without a strain, and put his efforts into a Bachelor of Commerce.
I first came across exchangers when I worked at an advertising agency in Bangkok. These young executives had spent a year of their teens at school in America or Australia and were the only ones among our local staff who deeply understood western marketing and advertising, and could translate them into a Thai context. In fact the firm would actively seek them out.
So I knew my kid would never be unemployed. Hell, even if the whole world economy collapsed he could still drive a tourist bus. My stepdaughter is a few years older and also exchanged, spending a year in an American high school learning to chew gum and put marshmallows in the salad.
Her mother soon straightened her out that this wasn’t 90210 but the maturing process had done its trick.
She’s now a marketing manager with a world-leading IT company, has a Qantas Club card and takes her husband on overseas luxury holidays on her frequent flyer points.
So, seriously, take a good look at your teenybopper. Maybe the best thing you can do for them is send them away.
ray@ebeatty.com
03 October, 2009
Who's brave enough to mess with Vegemite?
Melbourne Herald Sun, 3rd October, 2009
My friend on the phone was ropeable. "Have you seen what they've done to Vegemite? Called their new product iSnack2. What sort of name's that? They should be whipped, messing about with an Australian icon like that."
My friend, an art director for many years, is passionate about his marketing and this move pressed all the wrong buttons. "What are they going to do next, rebrand Coca Cola ‘iDrink'? 'Cause that's what you do with it." I'll modestly pass over his suggestions for Sorbent toilet paper. Let's just say he was annoyed. And he was not alone.
The company, Kraft, was hit by such a flood of indignation that within days they announced that the new name was ditched and something better would be found. But how could this happen with a name that was democratically selected?
Kraft had asked its customers to name the new product - basically Vegemite with added cheese - in a competition that drew 48,000 entries. You can imagine the range of responses they received, with varying degrees of printability but very little marketing strategy.
The name they really wanted was CheesyMite but that already belonged to Baker's Delight. Instead they chose to take the trendy, digital iPod, iPhone, iTunes track and even added the two at the end to make it sound like software. But it isn't software so it just sounded phoney. The idea wasn't thought through to explore all the angles.
Sometimes public input can work, but it has to be managed well. NASA recently announced the winner of its own competition. To name the new planet rover that will explore Mars in 2011. The winner was 12 year old Clara Ma from Kansas - and the Mars Rover will be called Curiosity. "Houston, this is Mars - Curiosity has landed!" Yeah that sort of works, a lot better than iRove.
The attraction of a naming competition is all the free publicity it can generate. Zoos are fond of producing fluffy little animals and asking the public to name them. This guarantees that your panda or lion cub or giraffe makes the news and then gets repeated mentions until the name is chosen.
The secret is to make sure the final decision is made in-house. Otherwise you can have problems like another NASA contest earlier this year. They asked for a name for part of the International Space Station. Comedian Stephen Colbert urged his viewers to write-in ‘Colbert' and won with a hefty 230,000 votes. Fortunately the judges retained the last word.
This February Virgin launched their new cut-price trans-Pacific airline. And they too decided to put it to a vote. Their competition drew thousands of suggestions, but they were not allowed to use the word ‘Virgin' for legal reasons. The final choice was less than thrilling: ‘V Australia'. But could we have lived with one of the also-rans like ‘Matilda Blue' or ‘Didgeree Blue'?
The big contest at the moment is not for a name but for a slogan. Minister Simon Crean offered $20 million to the advertising agency that could come up with an Australian slogan better than ‘So where the bloody hell are you?' (Not difficult.) But up there with ‘100% New Zealand' or South Africa's ‘Rainbow Nation'. Big ask.
Now once upon a time you'd get half a dozen of an agency's most creative minds and lock them in a luxury hotel suite for a long weekend. They would then brainstorm and debate, applying logic or emotion depending on the time of day or night, and filling sheets of butcher's paper with dozens of scrawled ideas.
Finally the Creative Director would reduce the jumble down to ten good lines which would be researched. Hopefully you'd end up with two good candidates that would work whichever one the client chose. That's called professional marketing. But hey, a competition's much more fun isn't it?
ray@ebeatty.com
END
My friend on the phone was ropeable. "Have you seen what they've done to Vegemite? Called their new product iSnack2. What sort of name's that? They should be whipped, messing about with an Australian icon like that."
My friend, an art director for many years, is passionate about his marketing and this move pressed all the wrong buttons. "What are they going to do next, rebrand Coca Cola ‘iDrink'? 'Cause that's what you do with it." I'll modestly pass over his suggestions for Sorbent toilet paper. Let's just say he was annoyed. And he was not alone.
The company, Kraft, was hit by such a flood of indignation that within days they announced that the new name was ditched and something better would be found. But how could this happen with a name that was democratically selected?
Kraft had asked its customers to name the new product - basically Vegemite with added cheese - in a competition that drew 48,000 entries. You can imagine the range of responses they received, with varying degrees of printability but very little marketing strategy.
The name they really wanted was CheesyMite but that already belonged to Baker's Delight. Instead they chose to take the trendy, digital iPod, iPhone, iTunes track and even added the two at the end to make it sound like software. But it isn't software so it just sounded phoney. The idea wasn't thought through to explore all the angles.
Sometimes public input can work, but it has to be managed well. NASA recently announced the winner of its own competition. To name the new planet rover that will explore Mars in 2011. The winner was 12 year old Clara Ma from Kansas - and the Mars Rover will be called Curiosity. "Houston, this is Mars - Curiosity has landed!" Yeah that sort of works, a lot better than iRove.
The attraction of a naming competition is all the free publicity it can generate. Zoos are fond of producing fluffy little animals and asking the public to name them. This guarantees that your panda or lion cub or giraffe makes the news and then gets repeated mentions until the name is chosen.
The secret is to make sure the final decision is made in-house. Otherwise you can have problems like another NASA contest earlier this year. They asked for a name for part of the International Space Station. Comedian Stephen Colbert urged his viewers to write-in ‘Colbert' and won with a hefty 230,000 votes. Fortunately the judges retained the last word.
This February Virgin launched their new cut-price trans-Pacific airline. And they too decided to put it to a vote. Their competition drew thousands of suggestions, but they were not allowed to use the word ‘Virgin' for legal reasons. The final choice was less than thrilling: ‘V Australia'. But could we have lived with one of the also-rans like ‘Matilda Blue' or ‘Didgeree Blue'?
The big contest at the moment is not for a name but for a slogan. Minister Simon Crean offered $20 million to the advertising agency that could come up with an Australian slogan better than ‘So where the bloody hell are you?' (Not difficult.) But up there with ‘100% New Zealand' or South Africa's ‘Rainbow Nation'. Big ask.
Now once upon a time you'd get half a dozen of an agency's most creative minds and lock them in a luxury hotel suite for a long weekend. They would then brainstorm and debate, applying logic or emotion depending on the time of day or night, and filling sheets of butcher's paper with dozens of scrawled ideas.
Finally the Creative Director would reduce the jumble down to ten good lines which would be researched. Hopefully you'd end up with two good candidates that would work whichever one the client chose. That's called professional marketing. But hey, a competition's much more fun isn't it?
ray@ebeatty.com
END
26 September, 2009
Product placement in TV and movies: Mr Spock’s Nokia
Melbourne Herald Sun, 26th September 2009
You’ll be surprised to know that in 2250 there will still be Nokia mobile phones and Budweiser beer, along with Captain Kirk and Mr Spock. Can these products last another 240 years? Well in the world of brand placement they can - they were seen in this year’s Star Trek movie.
Brand Placement is a $180 million business, which compared to the billions spent in advertising is pretty small fry - but it’s enough to affect almost every movie and TV drama you will see in the next year.
It’s 30 years since the business was born, when Christopher Reeve smashed into a giant neon Coke sign in Superman I.
Since then, those sneaky little product shots creeping into the actors’ hands have gone from occasional, to regular, to a pain in the eyeballs. But the producers insist that they are a necessary part of financing today’s film and TV business.
The British have always been stand-offish about the practice, even pixillating the logo on Simon Cowell’s drink when American Idol is shown there. But this week their culture minister, Ben Bradshaw, has permitted the practice “in order to help save the TV industry”.
He has been hit by a public storm that we in Oz, being already contaminated, would find surprising. But in Coronation Street they have their own brand of beer, and in Midsomer Murders the packets and bottles are always turned away from the camera. So allowing a logo to be seen is a scandal.
America, of course, has the most sophisticated system. And its champion user is Ford, who in the 2008 Product Placement Awards was clocked to have featured in 60 percent of the top box-office movies. They’re still up there this year.
If the movie shows a New York taxi it will be a Ford. They were in Transformers (1 and 2), I Am Legend, American Gangster, 17 Again, Hannah Montana - and of course that glorified motor show on celluloid, Fast & Furious. They have a Global Brand Entertainment Team whose job it is to stick Fords into movies.
Last year, of the 20 films to have a number-one weekend at the box office, each placed an average of 22 brands. The only clean skins were Harry Potter and Pixar’s Up. Inglourious Basterds was almost clean with just one product reference - to Walther pistols.
It’s only human to take things too far and so you’ll see cases where the tail starts to wag the dog. NBC has a TV comedy called Chuck, where a CIA agent works undercover in a shopping mall. The new season will only be made through the support of Subway sandwiches. So I wonder where the agent is going to work?
In these days when advertising income is being syphoned off by the Internet and new media, is this sneaky advertising the only alternative to endless, cheaper, reality shows and panel quizzes?
Maybe we’ll get used to it, as we have in sporting coverage. Will we see actors with Samsung logos on their shirts? Billboards in every external scene? Beam me up, Scotty!
I’d just like to conclude by assuring you that I received no payment for the mention of Coca Cola, Ford, Budweiser, Subway, Walther, Samsung, or Nokia in this article. More’s the pity.
ray@ebeatty.com
You’ll be surprised to know that in 2250 there will still be Nokia mobile phones and Budweiser beer, along with Captain Kirk and Mr Spock. Can these products last another 240 years? Well in the world of brand placement they can - they were seen in this year’s Star Trek movie.
Brand Placement is a $180 million business, which compared to the billions spent in advertising is pretty small fry - but it’s enough to affect almost every movie and TV drama you will see in the next year.
It’s 30 years since the business was born, when Christopher Reeve smashed into a giant neon Coke sign in Superman I.
Since then, those sneaky little product shots creeping into the actors’ hands have gone from occasional, to regular, to a pain in the eyeballs. But the producers insist that they are a necessary part of financing today’s film and TV business.
The British have always been stand-offish about the practice, even pixillating the logo on Simon Cowell’s drink when American Idol is shown there. But this week their culture minister, Ben Bradshaw, has permitted the practice “in order to help save the TV industry”.
He has been hit by a public storm that we in Oz, being already contaminated, would find surprising. But in Coronation Street they have their own brand of beer, and in Midsomer Murders the packets and bottles are always turned away from the camera. So allowing a logo to be seen is a scandal.
America, of course, has the most sophisticated system. And its champion user is Ford, who in the 2008 Product Placement Awards was clocked to have featured in 60 percent of the top box-office movies. They’re still up there this year.
If the movie shows a New York taxi it will be a Ford. They were in Transformers (1 and 2), I Am Legend, American Gangster, 17 Again, Hannah Montana - and of course that glorified motor show on celluloid, Fast & Furious. They have a Global Brand Entertainment Team whose job it is to stick Fords into movies.
Last year, of the 20 films to have a number-one weekend at the box office, each placed an average of 22 brands. The only clean skins were Harry Potter and Pixar’s Up. Inglourious Basterds was almost clean with just one product reference - to Walther pistols.
It’s only human to take things too far and so you’ll see cases where the tail starts to wag the dog. NBC has a TV comedy called Chuck, where a CIA agent works undercover in a shopping mall. The new season will only be made through the support of Subway sandwiches. So I wonder where the agent is going to work?
In these days when advertising income is being syphoned off by the Internet and new media, is this sneaky advertising the only alternative to endless, cheaper, reality shows and panel quizzes?
Maybe we’ll get used to it, as we have in sporting coverage. Will we see actors with Samsung logos on their shirts? Billboards in every external scene? Beam me up, Scotty!
I’d just like to conclude by assuring you that I received no payment for the mention of Coca Cola, Ford, Budweiser, Subway, Walther, Samsung, or Nokia in this article. More’s the pity.
ray@ebeatty.com
12 September, 2009
Why can’t a woman be more like a man?
Melbourne Herald Sun, 12th September, 2009
“Why can’t a woman be more like a man?” asked Professor Higgins. Well I’m sorry mate, she ain’t and never will be. So that’s why Fernwood Women’s Health Club was invented.
The fitness franchise celebrated twenty years last month and in the process has launched a new advertising campaign.
Diana Williams has given us a classic example of market positioning. You take a product, even in an intensely competitive field, and you give it an angle that nobody else has - in advertising parlance, the “unique selling proposition”.
Bear in mind that it does not really have to be unique, in that it does not exist anywhere else. But in perception - if you are the first person to promote that benefit, and bring it to the public’s attention, then as far as the public is concerned, you invented it.
So it was with Fernwood. Twenty years ago, back in little old Bendigo, Diana Williams stood up and promoted a gym as being exclusively for women, no men allowed. Then she stuck to her guns. She knew her market.
Let’s face it, many women get embarrassed sweating and straining in leotards that fail to disguise the lumps and bumps in their figures, before a roomful of men. They want to relax from looking good, even as they work on it. They responded to a man-free zone.
So much so that the clubs were opened in Melbourne and eventually around the country under a franchise model. And every one of them made the same promise. As immortalised in a Fernwood ad campaign a few years ago: “No Toms. No Harrys. No Dicks.”
Having hammered that message home for years, their new campaign can afford to concentrate on their customers’ self-image and aspirations. So the new line is “Find your inner fox”. Presumably talking about Jimmy Hendrix’s Foxy Lady or as they put it, “Happy, Sexy, Fun”.
The ads will run on TV, print, outdoor and online media. A typical poster ad declares: “Be a fox without botox”. The message being that if you exercise regularly you’ll feel fitter, look better, and be more confident.
The “No Dicks” campaigned positioned them securely in the public’s mind, so now they can afford to promote those more positive benefits.
The strategy has worked incredibly well. Fernwood is now the largest women’s health club in Australia, with 77 facilities, 80,000 members, 2,200 employees, and an annual turnover of $90m.
However, in July Victorian Attorney General Rob Hulls blundered into a hornet’s nest when he attacked the gender discrimination of men’s clubs. Why shouldn’t women be able to join the Melbourne Club and the Athenaeum, he asked?
The problem was that by taking a shot at these male clubs he also hit institutions like Fernwood and the Lyceum Club. They argue just as loudly for their right to be exclusively female, as men do for theirs.
There is a longer-term problem to this move, too. In recent years, throughout society, membership of groups and organisations has been falling - ask any political party to check its own numbers.
If you took away the gender exclusivity many of these clubs would have no more reason to exist, they would be killed off by political correctness.
There is now a parliamentary committee questioning the exceptions allowed under the Equal Opportunity Act, which is expected to report next month.
Now if they rule that women’s clubs are legal but men’s are not, expect much mouth-frothing from the top of Collins Street.
On the other hand I cannot see them ruling that women’s clubs are illegal. After all, it would be a very brave politician who would stand up before the wrath of 80,000 angry women in leotards.
ray@ebeatty.com
“Why can’t a woman be more like a man?” asked Professor Higgins. Well I’m sorry mate, she ain’t and never will be. So that’s why Fernwood Women’s Health Club was invented.
The fitness franchise celebrated twenty years last month and in the process has launched a new advertising campaign.
Diana Williams has given us a classic example of market positioning. You take a product, even in an intensely competitive field, and you give it an angle that nobody else has - in advertising parlance, the “unique selling proposition”.
Bear in mind that it does not really have to be unique, in that it does not exist anywhere else. But in perception - if you are the first person to promote that benefit, and bring it to the public’s attention, then as far as the public is concerned, you invented it.
So it was with Fernwood. Twenty years ago, back in little old Bendigo, Diana Williams stood up and promoted a gym as being exclusively for women, no men allowed. Then she stuck to her guns. She knew her market.
Let’s face it, many women get embarrassed sweating and straining in leotards that fail to disguise the lumps and bumps in their figures, before a roomful of men. They want to relax from looking good, even as they work on it. They responded to a man-free zone.
So much so that the clubs were opened in Melbourne and eventually around the country under a franchise model. And every one of them made the same promise. As immortalised in a Fernwood ad campaign a few years ago: “No Toms. No Harrys. No Dicks.”
Having hammered that message home for years, their new campaign can afford to concentrate on their customers’ self-image and aspirations. So the new line is “Find your inner fox”. Presumably talking about Jimmy Hendrix’s Foxy Lady or as they put it, “Happy, Sexy, Fun”.
The ads will run on TV, print, outdoor and online media. A typical poster ad declares: “Be a fox without botox”. The message being that if you exercise regularly you’ll feel fitter, look better, and be more confident.
The “No Dicks” campaigned positioned them securely in the public’s mind, so now they can afford to promote those more positive benefits.
The strategy has worked incredibly well. Fernwood is now the largest women’s health club in Australia, with 77 facilities, 80,000 members, 2,200 employees, and an annual turnover of $90m.
However, in July Victorian Attorney General Rob Hulls blundered into a hornet’s nest when he attacked the gender discrimination of men’s clubs. Why shouldn’t women be able to join the Melbourne Club and the Athenaeum, he asked?
The problem was that by taking a shot at these male clubs he also hit institutions like Fernwood and the Lyceum Club. They argue just as loudly for their right to be exclusively female, as men do for theirs.
There is a longer-term problem to this move, too. In recent years, throughout society, membership of groups and organisations has been falling - ask any political party to check its own numbers.
If you took away the gender exclusivity many of these clubs would have no more reason to exist, they would be killed off by political correctness.
There is now a parliamentary committee questioning the exceptions allowed under the Equal Opportunity Act, which is expected to report next month.
Now if they rule that women’s clubs are legal but men’s are not, expect much mouth-frothing from the top of Collins Street.
On the other hand I cannot see them ruling that women’s clubs are illegal. After all, it would be a very brave politician who would stand up before the wrath of 80,000 angry women in leotards.
ray@ebeatty.com
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