Although I still believe there is a place for advertising as a brand maintenance or brand affirmation tool, I am convinced that to build a brand today, you need PR. At one time advertising did build brands. But this was in a simpler America. That America, sadly, is no more.
I've been re-reading The Fall Of Advertising & The Rise Of PR, by Al and Laura Ries, and it is their book that has moved me from suspicion of advertising's demise as a brand-builder to conviction.
As the Ries' say, "Publicity is the nail, advertising is the hammer." What does this mean? It means that your PR effort helps make your message believable so that your advertising will have credibility when it hits.
Typically, companies want to hit the market hard and make a lot of noise. Advertising allows you to launch quickly, control the message, and have your message in as many media as you have the money for. However, that does not mean your message will be believed. The louder advertisers yell, the less likely I am to believe them. How about you?
PR takes time and does not necessarily work on your schedule. Planting new ideas or changing minds is a slow process. When your PR program rolls out over a longer period of time, prospects have time to adjust their attitudes. Brands that take this approach are longer lasting, too.
Chevrolet, for years the number one auto brand, was still number one in ad spending in 2001. It spent $ 819 million dollars – 39 percent more than Ford spent. That year, Ford outsoldevrolet by 33 percent. Since 1997, Chevrolet has outspent and undersold Ford. Chevrolet spends $ 314 per vehicle and Ford spends $ 170 per vehicle. Do you think advertising is working for Chevrolet?
Kmart, embroiled in financial difficulty for years, had revenues of $ 37 billion and spent $ 542 million on US advertising in 2001. Wal-Mart spent $ 498 million and garnered four times the revenue: $ 159 billion split between its Wal-Mart and Sam's Club stores. The average Wal-Mart store does $ 46 million in sales each year while its Sam's Club average store sells $ 56 million. Sam's Club does almost no advertising.
Those are old brands, you're saying. What about some newer brands, Harry?
OK, let's look at Pets.com. Remember the dog sock puppet that starred in their commercials? It won awards, but not sales. In six months Pets.com had $ 22 million in revenues and spent four times that much on advertising. Off-base advertising creativity at work.
The Body Shop was built totally by publicity. No advertising at all. Starbucks, until recently, did virtually no advertising. It has built a brand through good PR efforts. Starbucks' annual sales are around $ 1.3 billion, while advertising expenditures over 10 years, have totaled less than $ 10 million.
Finally, what advertising agency do you know that has built its brand with ads? Things that make you go "hmm."