Vintage Marketing Differentation
A selection of insights from Robert Williams, author of Vintage Marketing Differentiation.
- Using Big Data Way Before the Internet
- Dr Pepper Knew This in 1920
- Did you Know Coca-Cola Made Chewing Gum? Cigars?
- In 1939, Coke Offered to Install a Free Stationary Bottle Opener in Your Home. Fur Coat Not Included!
- Price, not Cost, as a Component of your Brand
- Can’t Afford a Huge Salesforce? Consider “The Larkin Idea”
- Don’t Ruin “Your Customer’s Gloves”
- Invest in Employee Brand Soul
Using Big Data Way Before the Internet
As recent articles in The Wall Street Journal document (see 'Three Hard Lessons the Internet Is Teaching Traditional Stores'), brick and mortar stores are closing at a record pace. One big lesson physical retailers are learning from the onslaught from Internet retailers is “Physical retailers must catch up to online retailers in collecting rich data [about customers]”
For example, “Data has been a vital part of Amazon’s retail revolution,” and according to Warby Parker, co-founder and co-chief executive David Gilboa, their custom-built eCommerce 'point of everything' system “. . . allows salespeople to know what customers have bought both online and off.”
As documented in the new book Vintage Marketing Differentiation: The Origins of Marketing and Branding Strategies by Williams & Williams, the battles going on today in the retail space highlight a central tenet of the book: the need to adapt to the changing demands of the customer, and the market; to understand
"The fifth P—perception—taking advantage of trends in timely ways assisted vintage companies and brands gain success, and in most cases dominate their markets. Paying attention to why and when particular strategies were created or selected, and subsequently implemented, highlights how the brand equity of the company or product line increased, due in large part to the successful implementation and timing of one or more of the 16 vintage marketing strategies."
Today’s current retailing scenario involving online competitors is reminiscent of the retail battle which took place nearly 100 years ago. Companies such as Amazon and Warby Parker are succeeding in part by utilizing a strategy developed by Sears long ago: Mail Order & Catalogs (#15).
"Sears' early instincts and insight . . . and growth were also fueled by innovative pre-computer-era data collection methods. In the initial decades of operation, Sears manually tracked what individual customers purchased from catalog-to-catalog, year-to-year. Based on these sales records, as well as other demographic information, Sears divided their customers into nearly 200 different classifications. Maintaining “Big Data” purchase details by customer helped Sears gain insight into market shifts and trends, allowing them to tweak their catalog product selection, pricing, and seasonal promotions to perfectly match the demands of their various customer segments . . . The Sears catalog in effect packaged a store in a book, and was the first of its kind in both breadth and length."
Over 500 pages of “packaging a store in a book” (page 199)
A century ago it was Sears who revolutionized the retail landscape with their new catalog strategy, taking advantage of the new “technologies” such as the railroad, and a highly efficient postal service, and shook up the established market players. Today it’s new competitors such as Amazon who are energizing the market. The vintage strategies which were created over 100 years ago can and are being successfully implemented in business today.
Dr Pepper knew this in 1920
A recent article in The Wall Street Journal by Ellen Byron (It’s Time for A Second Breakfast) discusses how “The most important meal of the day is increasingly eaten twice.” Restaurant chains are seeing “…another rush [of customers] around 10:30 a.m. ...having that second breakfast” ... which is “boosting sales of convenient breakfast foods”
But readers of the new book Vintage Marketing Differentiation: The Origins of Marketing and Branding Strategies by Williams & Williams, already know that the real market potential of the “second breakfast” was exploited by Dr Pepper back in 1884, with their famous “Drink A Bite To Eat at 10, 2 and 4” campaign. As the book explains, by utilizing strategy #6, Endorsements, and #2 Unique Promotions,
"Dr Pepper’s development of a quirky image, and a unique “10–2–4” marketing campaign based on University research is what differentiated Dr Pepper from the many other soda brands in the rapidly growing soda market of that era. The origin of Dr Pepper’s relation to these numbers goes back to 1920 when Dr. Walter Eddy, a professor at Columbia University, conducted research on the human body and its metabolism. Eddy discovered that a natural drop in energy occurs about 10:30 a.m., 2:30 p.m., and 4:30 p.m.
Starting in the 1920s Dr Pepper marketed their product widely and creatively, based upon breaking research which indicated that drinking something prior to the body’s natural drop in energy at 10, 2, and 4 o’clock could overcome this problem. In movie theaters, staff would stop movies at these specific times (10, 2, 4) and distribute free bottles of Dr Pepper. Giving away thousands of clocks with only the numerals 10, 2, and 4 on the clock face to different soda fountain locations was another way Dr Pepper promoted their 10–2–4 campaign to drink their soda at ten, two, and four o’clock. In addition, Dr Pepper placed the number 10, 2, and 4 on top of all their soda bottle caps, placed them on banners and signs, and advertised it on promotional objects such as pocket- or purse-sized mirrors and paper banks..."
As the WSJ article indicates, companies today are learning a central tenet of the book: the need to adapt to the changing demands of the customer, and the market.
"The fifth P—perception—is taking advantage of trends in timely ways assisted vintage companies and brands gain success, and in most cases dominate their markets. Paying attention to why and when particular strategies were created or selected, and subsequently implemented, highlights how the brand equity of the company or product line increased, due in large part to the successful implementation and timing of one or more of the 16 vintage marketing strategies."
Dr. Pepper has been going strong since 1884, in part due to their 10, 2, 4 campaign. The vintage strategies which were created over 100 years ago can and are being successfully implemented in business today. Perhaps the companies mentioned in the article such as Pret A Manger, General Mills, the Jimmy Dean unit of Tyson Foods, Weight Watchers, and Skyr Corp. can garner success just as the original companies did.
Did you know Coca-Cola made chewing gum? Cigars?
Who’s #1 in soda? Who’s #1 in gum? Once they might have been the same. Success in one product area doesn’t always mean a line extension of your brand will translate into another area. You need to understand your competitive advantage – and your customers.
Coca-Cola soda was created by Atlanta pharmacist and Confederate Army veteran Dr. John S. Pemberton in 1886, and it originally was intended as a “patent medicine.” Pemberton combined sugar, water, extracts of the coca leaf and kola nut, and caffeine. It was initially promoted as a medicine to cure headaches, relieve indigestion, and eliminate fatigue, and its distinctive flavor was also highlighted. Pemberton’s business began by selling Coca-Cola from the soda fountains in his own pharmacy. By 1891 Pemberton sold the company to Asa Chandler, a successful businessman, who is credited for establishing the initial Coca-Cola brand image.
In the late 1890’s the nacient soda market in the U.S. was intensely competitive (See entry on Dr Pepper, pg. 110). Coca-Cola implemented numerous promotional activities through their retail pharmacy distribution channel, to create awareness for their brand. Their wide-scale distribution effort included clocks, calendars, apothecary scales, pencils, pushouts, bottle wraps, souvenir fans and trays – all depicting the traditional Coca-Cola brand Spenserian script-logo (see below). The promotional effort initiated one of the most extensive promotional campaigns for any one product in history. Coca-Cola soda became famous and successful.
Yet did you know that in a diversification strategy to take advantage of the fast-growing chewing gum business in the United States (see Wrigley, pg. 67), in 1903 Asa Chandler licensed exclusive rights to manufacture and market chewing gum using the copyrighted words “Coca-Cola” to the recently formed Coca-Cola Gum Company, which was established by David Carson, William Clark, and George Rogers. As seen in the price list brochure issued by the company, Coca-Cola Spearmint Chewing Gum was offered to the wholesaler for $11.60, to be sold at retail for $20.00 – nearly a 75% markup.
Unfortunately, even though they advertised “contains the delightful tonic properties of Coca-Cola,” by 1905 operations failed and were bought by the Franklin Manufacturing Co. of Richmond, VA. Due to the effects of the sugar price gyrations in the 1920s, this company also fell into bankruptcy, and the attempt to brand Coca-Cola gum ended. (For an in-depth review of the Franklin Manufacturing Co. years see here.)
In 1939, Coke Offered to Install a Free Stationary Bottle Opener in Your Home. Fur Coat Not Included!
How does your customer actually use your product offering? Three innovations illustrate the focus Coca-Cola placed on ease-of-purchase and ease-of-use.
Most of us know a lot of information about Coca-Cola, and its iconic bottle. But that’s just part of the story:
- In a picture from the 1939 Atlanta Coca-Cola Bottling Association magazine (above), Coca-Cola sponsored the installation of thousands of free stationary soda bottle openers at homes across the city. The women installers were equipped with tool kits and supplies, and had undergone training in order to correctly answer questions regarding Coca-Cola quality.
- Since its founding, Coca-Cola was well known in pharmacies nationwide, one of their distribution channels, and by 1930 there were 230 Coca-Cola “servicemen” who called on 100,000 soda fountains nationwide to train them on drink preparation, and to distribute promotional material (page 52). (I witnessed Guinness doing the same thing in Irish pubs).
- Coca-Cola invented the carry-home “6-pack” container in 1923, which offered a convenient and safe method to transport Coca-Cola soda in glass bottles, a packaging improvement that coincided with the growth of the home refrigerator market (page 75).
Make sure that your product is not only easy to purchase, but that it is easy for your customer to actually enjoy its benefits.
Price, not Cost, as a Component of your Brand
Given the current market of instantaneous price comparisons via the online channel, it becomes crucial to understand the true value a customer places on your offering. We can gain insight by respecting how H. J. Heinz Co. used pricing as a brand component in the late 1800s.
- In large part, due to Heinz’s focus on quality, they offered to refund purchase money if not “Entirely Satisfactory,” and heavily promoted their guarantee along with their Keystone trademark. As one trade card noted, “We offer no money forfeit to guarantee our quality. Our name is guaranty of absolute purity.” Breaking from convention, Heinz authorized this full purchase price refund by returning the product to the grocer, (distribution channel partner), instead of having to return it to Heinz.
- A key differentiation of Heinz was that they pioneered the elimination of product price differentials based on shipping distance. Regardless of location, Heinz offered all grocers the same price, which was unique at the time.
- By advertising to the consumer, Heinz cut out the expense of the wholesaler, and sold products directly to the retail grocer, resulting in higher profits for both Heinz and the grocer.
How do your customers view your relationship with your distribution channel partners? Keep the customer’s needs at the forefront of your decisions.
For similar interesting profiles of vintage brands and companies, listen, and check out Vintage Marketing Differentiation: The Origins of Marketing and Branding Strategies (1846-1946). Contact the author at firstname.lastname@example.org
Can’t Afford a Huge Salesforce? Consider “The Larkin Idea”
In the 1880’s the Larkin Company, a major manufacturer of soaps located in Buffalo, NY, realized that by adapting to the market and selling products to customers directly in their residences, using door-to-door salesmen referred to as “slingers,” the cost of the middleman could be eliminated. These cost savings were passed along to the customer via lower prices, thus increasing sales volume, and profits.
Using the slogans “From Factory-to-Family: Save All Cost Which Adds No Value” and “The only Great Manufactoried in the World Devoted to Cooperation with Consumers,” Larkin actually first began business selling via mail-order; selling directly to the consumers by means of a catalog, which was a key component for the Larkin Company’s early success. Larkin’s catalog business grew to become second only to Sears, Roebuck and Co.
But their sales approach evolved, and their door-door direct marketing system became known as “The Larkin Idea.” They created a Larkin Clubs of Ten, one of the first “party plan processes”, by hosting Larkin product parties in their homes, where the purchasers (primarily housewives) became sellers of Larkin’s wide product selection. This leveraged and magnified Larkin’s sales efforts without incurring any additional employee expense.
Magazine promoted the Larkin Club of Ten, by illustrating the items a Larkin Secretary could redeem by hosting parties, and generating sales. Circa 1928. Source: Author’s Collection, Vintage Marketing Differentiation
It’s often said that necessity is the mother of invention. Listen to the needs of your customers, and figure out how to provide what they really long for, by adapting your distribution channels to your customer base.
Don’t Ruin “Your Customer’s Gloves”
The package that contains your product is important, for many different reasons, and significant time and effort needs to be focused on it. Companies like IDEO and Frog Design excel at the anthropological art of understanding how people use products, in order to optimize the product design functionality.
But notice how companies like Dr Pepper, Coca-Cola, and Pepsi in the 1920’s through 1940’s offered a bottle wrap, with their advertising prominently displayed on it. Women’s fashion at the time still included wearing gloves, and a bottle wrap “packaging” sleeve placed around a bottle avoided the problem of any liquid condensation on the outside of the bottle, especially when bottles were often placed in a bucket of ice to cool.
Circa 1930’s. Source: Author’s collection; Vintage Marketing Differentiation
Of course the need for these complementary items, and the advertising opportunity, faded away as ladies’ fashion trends changed.
This is a small example of how these companies revitalized their brand, and then reinforced it, by using the Brand Flux Model.
Brand Flux Model (Williams, 2012); design © Adam J. Williams
How does your brand adapt, so it doesn’t ruin your customer’s “gloves”, as consumer needs go in (and out) of style?
Invest in Employee Brand Soul
In most companies the brand is that of the company. But in the direct sales channel of door-to-door, direct to the consumer it is often the reputation of the salesperson that makes the crucial difference. These people are part of the Brand Soul of your company (Williams, 2012).
Three example highlight this: The “Watkins Man,” the Prudential Agent, and the Rawleigh Man.
Founder J.R. Watkins created “The Watkins Way, or the wagon method of distribution,” as he sold his consumer goods door-door in the mid-1800s. One key to Watkins’s success was that the Watkins Man was always a resident of the territory he covered, thus he had a vested interest in product quality, service, and both his own—and Watkins’s—reputation. Through this method Watkins developed many personal relationships in his 100-mile radius.
Photo circa 1909. Source: Author’s collection, Vintage Marketing Differentiation (2017)
Prudential Insurance introduced Industrial Insurance to America in the 1870s by implementing a door-to-door direct to the consumer sales network of agents. These agents collected policy premiums each week from customers at home. This direct distribution channel meant that the agents soon became friends and confidants of their customers. Prudential Agents grew the business rapidly and increased their reputation by offering fast, fair claims service. Their excellent reputation quickly spread based upon the strength of word-of-mouth.
Besides high quality standards, one key to the success of the growth of W.T. Rawleigh’s products was their sales distribution channel, known as the “Rawleigh Man” system. This system bypassed the then-standard jobber and dealer relationships, which were the norm in the late 1800s. Each Rawleigh Man was the sole owner and operator of their own business, and their success came as a result of their frequent, regular, and dependable service. “The [Rawleigh Man] franchising model works because it provides a formula for operating a successful business by delivering a uniform product and service to customers. It provides franchisors with the capital they need, creates distribution channels, and gives consumers a recognized standard of what to expect and a higher perceived value.”
If you invest in your company’s Brand Soul - your employees – success will not only follow, but you create a competitive advantage which is difficult to duplicate, or effectively compete against.