December 2, 2006
doom and gloom are your friends
Digital Agency made some good points about the Thresher virus.
Some of the UK newspapers are doom–mongering the promo, saying Thresher could end up with oeuf on their faces. Thresher are saying they’ve no idea where it will end. That it was just going to be a more modest promo for suppliers and the thing got out of hand, bigtime. Or is that just spin? Smart marketers working the room and ‘managing’ the buzz?
I find the doom-and-gloom of the newspapers rather amusing…
Assume the costs of the promo are covered [i.e. they’re not losing money on each purchase, or at least, they have enough cash in reserve to cover the promotion, however successful]…
Taking that into account, what’s it worth to them to have THOUSANDS of new customers walk into their stores, just before Christmas?
Tens of thousands of customers who would have most likely been shopping somewhere else for their wine [Oddbins, Majestic etc]… who are not just buying wine, but spirits, beer etc which are not covered by the promo? [I have photos of recently-emptied beer fridges from the stores, which I might post later. The people coming in ARE NOT ONLY buying the stuff in the offer].
Also, Doom & Gloom might be beneficial for Thresher’s. Compare these two hypothetical newspaper headlines:
“Big company scores massive marketing triumph”.
“Big company up shit creek without paddle.”
Which one sounds more authentic to the Average Joe? Which one is more likely to stir up a feeding frenzy? Capture the public imagination? Appeal to individual self-interest?
Do the math.
Now factor in how much was spent on the promo [i.e. Almost Zero]. Compare that to hiring a bog-standard celebrity endorsement or mainstream advertising campaign.
Again, do the math.
Thirdly, the journalists fail to realize that moving stuff through at a small profit is ALWAYS better than having stuff gathering dust at the warehouse. And WAREHOUSE DUST is a HUGE problem in the wine business.
The biggest problem for Thresher’s, which the journalist mostly FAILED to cover, is the logistics. Suddenly your shops are emptying at an unprecedented rate. I feel sorry for their truck drivers already. But do I think it’s a problem they can’t handle? I do not.
By concentrating on trying to uncover newpaper-selling controversy at all costs, instead of thinking about the actual business at hand [selling wine], the journalists made the virus EVEN MORE powerful. Though I am personally grateful to them for that, I’m not convinced that was their intention.
We live in interesting times.
[Bonus Link:] Neville Hobson makes some great points as well. Rock on.
[Note To Self: I’m wondering what Journalism 2.0 Maestro, Jeff Jarvis would think. Seriously.]
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“Now factor in how much was spent on the promo [i.e. Almost Zero]. Compare that to hiring a bog-standard celebrity endorsement or mainstream advertising campaign.“
In my local Thresher this afternoon, I noticed life-size cut-out displays of celebrity chef Gordon Ramsey dotted around the store.
That kind of endoresment must be costing Thresher a fortune.
Be interesting to measure how much wine & champagne Thresher has shifted that’s attributable to that celeb tie-in, and how much via the word-of-mouth 40% offer…
Hugh, I asked my local Oddbins manager this afternoon if he was aware of the Threshers promo.
He said that he was, but he got somewhat defensive, and appeared to be a wee bit rattled by it all. (He’s actually a really nice bloke incidentally.)
This suggested to me that there’s perhaps another ‘benefit’ to Threshers. And that is to give their staff a bit of a fillip, a bit more to feel upbeat about, in taking the fight to the likes of Oddbins. (Who’ve pretty much been giving other wine merchants a bit of a kicking for pretty much the whole of the last decade, winning the Wine Merchant of the Year accolade time and time again.)
But ultimately, unless I’m wrong about trends in marketing, it has to fail because it’s based on a deception. *Pretending* that your discount promotion is an accident can’t possibly be a good basis for a relationship with the people who take it up — especially once they find out it was all made up…
I think you’re wrong, Steve, You’re missing something.
Most people are smart enough to figure out what you just said [unless you write for Fleet Street, of course, but then the conversation really isn’t about value for money; it’s about property prices, school fees and midlife-crucifixion, however cleverly disguised]. Yet the viral went crazy anyway. Why?
So. Why. Did. People. Get. Into. It?
Because. The. Offer. Though. Perhaps. Not. The. Best. In. The. World. On. Paper. It. Was. Enough. To. Give. The. Average. Shopper. Enough. Reason. To. Shop. At. Thresher’s. As. Opposed. To. Having. To. Go. To. Some. Ugh. Gag. Puke. Vomit. Vast. Suburban. Tacky. Infested. Supermarket. And. Mix. With. The. Plebians.
Class War Roolz OK Oi!
oooh — you nicked my tag [translation = pinched my words ] = ‘doom’ and ‘gloom’, or rather the lack thereof, in my particular circumstances. Love the cartoon.
Cheers
http://whitterer-autism.blogspot.com
There is an old marketing joke, “We make a small loss on each sale, but we’ll make it up in volume.“
While the print media may have missed the point, the BBC is reporting that the 40% discount is on a very high initial price. The same or similar wines are available elsewhere at around 60% of the Thresher shop price.
The high Thresher prices is one reason I don’t shop there; the other is the lack of a local shop. Tesco is cheaper and has a very good no hassle delivery service.
Gentlemen,
This is called “buying market share”. FMCG brands have tried it. Newspapers (especially in London) have tried it too. This sort of behaviour is generally frownwed upon by the academics and the suits… Of course you will sell more if you cut the price. But the problem is that (1) you are training the consumer to buy a bargain not a brand/shopping experience (2) you are starting a pricing war which like gangland wars or civil wars leaves to misery… The right way to judge this campaign is to ask “will the Thresher-promo-wielding customer return for a second purchase?” I don’t see anything in this campaign with a hook. I think, therefore, that it is a badly conceived campaign.
You love this don’t you.
GREAT piece of analysis Hugh!
I LOVE how you cut through the doom and gloom crud of mainstream media types and… presented a far more accurate and meaningful picture of the situation (and benefits) for Thresher and their customers.
A company who set out in the hope of creating this kind of interest would wet their pants with joy to produce results even close to the visibility and shopping traffic into their businesses as experienced by Thresher.
The fun thing is that Thresher got all these benefits by accident! I wonder if bloggers might have had some effect in creating this great situation (for customers and Thresher!)!!!
Traditional marketing types are quaking in their boots!!!!!
I agree with you somewhat, Rodrigo, but another point I haven’t quite talked about yet.
As a marketer, my aim in not to get customers to think differently about my client’s product, but to get my client to think differently about their customer.
And I find blogs a good way of doing that, although yeah, it’s not the only way.
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