Wednesday, November 27, 2013

The gap between The Coca-Cola Company and The Gap

Two articles grabbed my attention over the last couple of days. One talked about The Gap suspending advertising in the fourth quarter in the United States. And one talked about The Coca-Cola Company suspending advertising in The Philippines. One company got it absolutely right, and one is stuck in 1995.

Let’s review…

First The Coca-Cola Company in The Philippines (disclaimer: I used to work for Coke. But that was a long time ago. I do still hold some shares).

Here is the link to the announcement from Coke on their official website. The decision was not that hard: at a time in the Philippines when all the news across all media was focused on devastation and human suffering, it made no sense to share an “Open Happiness” message with consumers. But the brilliance is of course to turn the self-elected advertising stop into a PR, media and brand enhancing opportunity.

And that is exactly what Coke did. They decided to donate the money not spent on media towards relief for the victims of typhoon Haiyan. And they did this on top of their “normal” donation of fresh drinking water (I call this “normal” as Coke has done this many times around the world).

And although it was something Coke only did in The Philippines, the news went global and was mostly greeted very positively. A search on Google for “Coca-Cola Haiyan” delivers over 3.3 million articles.

Now let’s look at The Gap. In a recent conference call, CEO Glenn Murphy stated that, due to disappointing results his company would not spend an anticipated $16 million on media (read: TV) in Q4 of 2013. He delivered this news with a bewildering set of arguments which I have summarized here in my own words:

- TV works really well for The Gap, especially our latest set of ads;
- But our third quarter media buy didn’t deliver;
- Which was strange because people loved our creative – they said so themselves on Social Media.

So they had great creative (for TV) which everybody loved, but it didn’t work and therefor they are cancelling the 4th quarter. Huh? He then also states that he isn’t against TV as long as they have a great idea for it, indicating:

(a) they then must NOT have had a great idea for TV in the third quarter despite what people said on social media;

(b) that “great idea” in the mind of The Gap C-suite equals TV.

The real nail in the coffin is the statement that this third quarter of TV activity was The Gap’s first TV activity in four years! So after four years they make a comeback on TV for one quarter, during which their business tanks.

Here is a quote from CMO Seth Farbman at the time the TV campaign was announced via AdAge in August: "We don't look at TV as an incremental spend that you layer on an existing plan. We put a new media model together that looked at internal and external data. …There was quite a bit of science. But there is an emotional value that comes from using all media, especially TV. It suggests your confidence is there and you have something to say.”

Does that mean that all other media are for when you have nothing to say, or less to say?

Anyway, The Gap has now decided to suspend (TV) advertising in light of their poor business performance of one quarter. The money is not going to a good cause. Or other media. It is going to prop up the bottom line. If I were a shareholder I would now very much mind the gap.

In our book “Z.E.R.O., zero paid media as the new marketing model” we don’t take aim at TV advertising as the bad boy of marketing. We don’t encourage our readers to go from on-air to online, or to shift from analog to digital. We do encourage marketers to ditch being brand or campaign centric in approaching their marketing strategy, and to no longer use your TV campaign as the scaffolding that holds up your whole campaign (or IS your whole campaign).

And we suggest shifting a sizeable chunk of your expensive, in-precisely targeted and decreasing-in-relevance (TV) ad dollars for more targeted, cost-effective and impact/engagement creating ad dollars. When planned well, these dollars should allow you to create consumer acknowledgement, dialogue, incentivation and activation, which are all a lot more powerful than almost any TV ad.

It looks like Coke understands this a whole lot better than The Gap.

1 comment:

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