Paul Jacobs offers a follow up to his piece earlier this month about marketing mistakes:
A while back I wrote a posting about how Diet Coke’s market share has fallen and pointed out several lessons that broadcasters could learn from their experience. Here’s another example from outside of our business that points out the cost of poor decisions.
Unilever has announced they were putting their laundry detergent business up for sale (remember Wisk?). This is noteworthy because a few decades ago, Unilever was locked in a pitched battle against Procter & Gamble (Tide, etc.) for supremacy in this highly profitable category. Hundreds of millions of dollars in advertising and marketing were spent – this category is extremely important to both companies because of the huge profit margins involved and the proceeds go to invest in new products and increasing market share.
The fact that Unilever is getting out of the business shows who the big winner is. But in a recent article in Advertising Age, two reasons stand out that we should take note of:
- P&G aggressively conducts research and isn’t afraid to innovate. They were one of the first believers in ethnography, where consumers are viewed using the product in their natural environs. They knew that data was valuable, but there’s no substitute for observing consumer behavior. While P&G researchers were watching consumers wash their underwear in their basements, the article notes that "Unilever executives hadn’t been in a laundry room for years," and in an interview in 1999, their President was quoted as saying, "That would never happen here."
He doesn’t have to worry about that any more. Of course, he probably has someone else wash his underwear.
As we learned while conducting "The Bedroom Project" ethnographic study for Arbitron, observing consumers in a natural setting interacting with and talking about a product is incredibly valuable, and something radio needs to do more of. The mystery behind why radio listeners do what they do can be found simply by observing behavior and following up with key questions.
- P&G played hardball. Last year, P&G spent $218 million marketing their laundry brands compared with $25 million for Unilever. They swamped them. In radio, we’re trying to defend ourselves with shrinking promotion budgets while Apple spends hundreds of millions to market iPods and iPhones and Sirius and XM spend even more marketing satellite radio. Why are we surprised to learn that usage of these products are cutting into time spent listening to radio?
Some of the solutions for radio’s challenges are out there. We can learn from other’s mistakes. And mistake number one is, "Don’t become Unilever."
You can see both "Bedroom Project" presentations at the NAB/R&R Conventions in Charlotte this September. Conceived by Arbitron and conducted by Jacobs Media, "The Bedroom Project" is an ethnography study about media, technology, and survey research. The presentations are Wednesday afternoon at 3:45 at the NAB; Thursday afternoon at Jacobs Summit 12.
Jacobs Media has consistently walked the walk in the digital space, providing insights and guidance through its well-read national Techsurveys.
In 2008, jacapps was launched - a mobile apps company that has designed and built more than 1,300 apps for both the Apple and Android platforms. In 2013, the DASH Conference was created - a mashup of radio and automotive, designed to foster better understanding of the "connected car" and its impact.
Along with providing the creative and intellectual direction for the company, Fred consults many of Jacobs Media's commercial and public radio clients, in addition to media brands looking to thrive in the rapidly changing tech environment.
Fred was inducted into the Radio Hall of Fame in 2018.
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