On July 31, Gap, Inc. pulled out all the stops to promote its new autumn clothing range. Its multi-million dollar campaign featured not one, but two music icons: pop diva Madonna and hip-hop star Missy Elliot.
The 'New Groove, New Jeans' campaign blitzed across several TV channels, and the focus was Gap's fashion gamble: corduroy jeans. Interestingly, even while the campaign was on television, Gap kicked off an equally aggressive promotion to draw traffic into stores.
If a customer walked in and tried on a pair of cords, he got $10 off every $50-purchase. In effect, Gap was virtually giving away $10 just to get people to try out a new product. How desperate can a company get?
The short answer: pretty. A company's marketing can never get too desperate as long as it results in sales. "What Gap did is absolutely wise. An overwhelming offense is the best way to market,'' says Mark Stevens, author of the recently published <i>Your Marketing Sucks</i>, and president of MSCO, a New York-based marketing firm.
"Most marketing sucks because it is lazy. In lazy marketing, the company relies on a single initiative or a standard set of initiatives that don't bring about a convergence of elements needed to get the consumer to spend. It isn't a swarm offensive.''
Indeed, Gap left no flank open. The beleaguered clothing retailer is just recovering from a long slump. It realised that it had to get the consumer's attention, but more importantly, it had to get people into stores.
The 'New Groove' ads spread the message that Gap was unzipping an exciting new range, but it was the $10 off that brought traffic -- mainly Generation Y-ers, who have never worn cords in their lifetime.
According to a spokesperson, Gap experimented with a multi-pronged offensive in the spring of 2003, when it pushed a new line of khakis. When that worked, the company stepped up the excitement a notch by signing Madonna and Missy Elliot for the fall line.
"The important thing is to do everything in marketing in a synchronised manner," says Ganesh Iyer, assistant professor at Haas School of Business, University of California. "The same dollars spent will result in more impact then.''
That's a lesson CEOs need to take to heart. In the final reckoning, the CEO is the person in charge of marketing even if the company has a chief marketing officer. And the most important role that the CEO plays as a marketer is to track marketing's relationship with sales.
In fact, Mark Stevens advocates 'extreme marketing': ensure that every rupee spent on marketing results in more than a rupee of sales. It's that simple, and, as panicked marketers will hasten to add, that much more difficult to execute.
It isn't just the marketer's fault. The problem is that the system has become warped. Year after year, marketing departments pump in more money into schemes that blur the direct correlation between marketing expenses and turnover.
Hardly anyone can cite the example of a marketing department that does not ask for a rise in budget over the previous year. Certainly, few can talk about a marketing department that gave back money it saved from last year's budget.
As the financial year ends, the marketing team searches desperately for avenues to burn up the spare cash rather than risk a budget cut in the next financial year. Meanwhile, no one worries about accounting for the marketing spend.
There are at least two other areas where alert CEOs can help their companies' marketing from going astray: award-winning ad agencies and campaigns that entertain. The former, Stevens feels, should be sacked because award-winning agencies are more concerned about flaunting creativity than pushing sales.
And the latter should be banned because entertaining advertising might engage the viewer momentarily, but it doesn't sell the goods. As for CEOs who accept marketing at face value, don't even get Stevens started on the subject of mind-share.
"Companies need share of wallet, not share of mind. Mind-share isn't money in the bank. A company can't deposit one million units of mind-share in the bank. It can't pay the payroll with mind-share; it can't pay the stockholders with it. Mind-share is an excuse on the part of agencies that can't generate sales. It's a complete, crazy, lying cottage industry of nonsense,'' he rants.
Stevens might be driving home a nail with a sledgehammer, but there is a kernel of truth in what he says. Most companies accept the fuzzy-logic that marketing expenses cannot be expected to stand up to the punishing test of return on investment.
Instead, Stevens suggests that CEOs should declare a short 'marketing moratorium' during which no marketing spend is allowed and all marketing expenses are scrutinised for their impact on sales.
"Zero-based budgeting and zero-based thinking -- all companies should do that at least once a year,'' says Stevens. That is the only way marketing will get the message: close the gap between spend and sales.
The columnist is a Boston-based management writer.