08:16 – Winter is supposed to return this week, with snow and freezing rain in the forecast for Tuesday through Thursday. At least tomorrow is supposed to be decent weather for Barbara and Frances to take their mom home from the hospital.
We’re building the subassemblies we need to get more kits built for inventory.
Yup, we are going back down to 35 F Tuesday night. Again and again. This climate change stuff is killing me. Although, walked three miles today at 65 F and loved it.
I wonder if I should buy stock in Depends? I wonder if this guy tells me to do so?
http://www.amazon.com/The-Demographic-Cliff-Deflation-2014-2019/dp/1591847273/
I must admit that I am 53 and everyone in the USA seems to be older now. Old people do not buy stuff, they only use it. No new cars, boats, homes, etc. Just high fiber foods, heating and adult diapers. Sounds like a recipe for shutting down the USA.
Dent is not at all a reliable source, IMO. He missed the housing bubble and subsequent banking collapses entirely, and was wildly off in predicting the Dow would climb to 40,000 by 2010. Further, he predicted a significant downturn in 2010, which has yet to materialize. But CNBC loves him, in spite of his all-too-obvious failures.
Demographics is everything to Dent, but his theories about them never hold up. Baby boomers still make more money, have more money, and spend more money than the younger generational groups. Advertising does not grasp this, because it is not hip to advertise to old people, and advertising must first and foremost be hip. Actually demonstrating that your advertising increases revenues is not something ad agencies spend much time on. Radio and television since WWII have been far greater sales motivators than newspapers, but until the ‘80’s, selling TV against newspapers was truly difficult–even though the newspapers could not tell advertisers how many people saw their ads, whereas television could! Car dealers were the first to see clearly that TV ads brought scores of people onto their lots, when newspapers did not. And that is still the case. Big pharma also knows that and has never been afraid to advertise to oldsters.
Nothing I have seen indicates baby boomers do not buy stuff. They still outspend every other generational group. That makes the broadcasters’ continued focus on 18 to 35 beyond baffling, and even self-destructive, IMO. Big conglomerate radio has completely abandoned baby boomers as a market. At the radio project, the thing we hear the most is: I want to hear the music from my high school era. For boomers who were in high school in the ’60’s and ’70’s, there is NO ONE playing those songs any longer. Music history on the radio begins with the ’80’s nowadays.
The money vs. demographics situation might change once more baby boomers actually quit working, but my post-65 peers are all still employed at something—earning and spending.
The money vs. demographics situation might change once more baby boomers actually quit working, but my post-65 peers are all still employed at something—earning and spending.
A lot of my 60+ friends are talking about retirement but are not actually retiring. Most of them are scared about rising costs, especially health care.
Chuck, you miss the point of advertising. It’s primarily about establishing and maintaining brand preferences. The 18-34 segment is so important because advertisers and their clients believe that these young people do not yet have their preferences set in stone. The 35-49 segment is much less likely to change brands, and the 50+ very seldom try anything new if they’re happy with what they’re buying.
Prove that advertising works? Reminds me of the days I was running a small software business. I talked to several marketing companies. The conversation always ended when I made it clear that I would only pays for results. Sales attributable to the marketing, any way they cared to do it, but not just money paid for who-knows-what. They all acted like I was from Mars…
As someone once commented, “50% of my advertising budget is wasted; the trouble is, I don’t know which half.” Of course, I think it’s more like 99.999% is wasted.
Brand recognition is a powerful force in the business world. The 18 to 34 demographic is probably the most important adult demographic. I suspect reaching children is even more important in brand recognition. I’ll never forget the first time my daughter demonstrated brand recognition. We went to the Feast of the Hunter’s Moon and my daughter started crying just after we passed the Golden Arches of McDonalds. She had never been to that particular McDonalds, but she realized what the sign meant.
My kids always wanted to go to McDonald’s when they were young, but never do as adults. McDonald’s actually has quite a few items on their menu that are not only tasty, but good for you, too. IMO, they work hard to be something above a beef and french fries place.
But I have always maintained that “branding” is a ruse. It is make-work for busybody PR and Marketing types to have it look like they are doing something important, when the important part of any selling effort is get somebody to make a decision to get off their duff, pull money out of their wallet, and actually fork it over to BUY something.
Brands come and go. Time and effort spent on brand recognition is wasted, because whatever the product, the likelihood is overwhelming it will not be there in a few years. Walkman, anybody? Remember Sony Watchmen? All passé. Brand has only been important to a very few firms—like the McDonald’s example above (and brand image is only one part of McDonald’s sales efforts), P&G who take their brands seriously into the long-term, a couple car manufacturers’ products like Ford’s Lincoln, a couple of appliance manufacturers, and of course, Apple. It is a huge mistake and waste of money, IMO, for any company to spend big bucks advertising for brand recognition with the hope of future sales. Very few brands mean anything at all. They certainly do not mean sales with no other call to action.
Marketing used to be the term applied to the secretaries who took salesmen’s calls while they were out selling, and helped them fill out the orders, billings, and prepare brochures to aid their sales pitches. The sales manager was always a street sales guy when I started working. Now the whole thing is called Marketing, including the salesmen, and the Marketing manager is quite often somebody who never leaves the office and has never sold a dime’s worth of the company’s product, except indirectly through the salesmen reporting to them.
I was connected on the periphery of a radio station located near Tiny Town when I was a teenager. This station was a sales motivator. The town was a GM manufacturing town with several different parts manufacturing plants. The station had a policy that they would do a live broadcast from a retail store, and if they did not double the traffic into that place, the broadcast was free. They never had to make good on that ‘no charge’ promise, because they always increased—sometimes by a hundredfold—the traffic coming into the stores. The store owners and managers who shelled out the money for those broadcasts, knew which 50% of THEIR advertising expense was working—both of them.
When I started part-time at one of the Indy TV stations right after high school, we had a used car dealer just a couple blocks from the station. There was an alley out back, and we wheeled a camera down there on Saturday afternoons. The car dealer himself brought a parade of cars down the alley, and one of our well-known staff announcers stood out there with him and did 2 minute commercials in the breaks of a run of B movies on the Saturday afternoon schedule. Their schtick was that the car dealer would tell all about the car that pulled up next to him, and there was a big piece of construction paper with a price on it. After the description, it was part of the announcer’s job to rip that price off the car, and write on it a new price. They made believe that the announcer was just randomly inventing a low price, although it was carefully planned in advance. When the announcer wrote the new price in magic marker, it was often several hundred lower than the previous price (hardly any used car sold for over $1,000 in that era). Occasionally, he would write $50 on the car. There was a line the car dealer frequently used that became one of those phrases quoted by people all over town. The announcer’s name was Gene, known to friends as Geno, and on seeing the new, lower price, the car dealer would say, “Geno, you’re killing me!”. People flocked to that car dealership on those Saturday afternoons, and that advertising deal went on for years until the car dealer had an unexpected heart attack, closing the dealership.
As we baby boomers left the 18 to 34 age group, and efforts to continue pursuing us did not persist, I have maintained that is a huge miscalculation of the advertising industry. There are others out there who do marketing research for advertising that agree with me. It is a waste to market to 18 to 34. That group does not even read newspapers, watch TV, or listen to radio in the numbers that older people still do. And they have no money. Spending advertising dollars on so-called ‘branding’ with the hope that somehow, someday, someone in that group might make a purchase is nuts. That is a good way to watch both 50%’s of the advertising budget go down the drain. Unless things change dramatically, the younger generations will not ever have the spendable income baby boomers had—and still do have. And the liklihood the product will still be available 5 or 10 years down the road, is slim.
Chuck, the brand isn’t the tech toy, it’s SONY! There are youngsters today who won’t have a clue what a Walkman is, but they all know Sony.
Well, I disagree and so does the definition of brand. Brand is the product and the product name, not the company owner’s name. Although good products give the parent company a good image—but the parent company is not the brand, the product is. iPhone is not known as Apple, it is known as iPhone. Their other brands are iPod and Mac. It was the same back in the Walkman days—nobody said, ‘I’m taking my Sony with me’; they said, ‘I’m taking my Walkman to work.’ Advertising—almost exclusively—was and is not for the company, it is for the product. Sony did not advertise Sony, they advertised a Walkman. Even P&G does not advertise P&G, they advertise their products: Charmin, Ivory, Pampers, Swiffer, Crest—all of which are names for their products, i.e. their brands. Sony may have moved on from the Walkman, but their brands now are PlayStation, VAIO, and Blu-Ray. Admittedly, some products carry the owning company name, as in my old ‘Sony Clock Radio’ and ‘Apple TV’. But it is the product, not the company, that is the brand.
So IBM, Kodak, Xerox, Bayer and Coca-cola aren’t brands?
The simple fact is, both products and company names are brands. What I meant to convey was that Sony was the far more important one. As is Apple. Look at an iPhone. The Apple logo is front and center, and very prominent, while the device name is smaller and lower down.