Small Business

Ad Consistency: It's the Real Thing


All too often, troubled companies think a new ad campaign will fix what ails them. As a matter of fact, it often makes things worse

Pier 1 Imports (PIR) has had a rough 15 months. That's how long the chain has racked up declines in same-store sales. This year, it experienced its first quarterly loss in a decade, and CEO Marvin Girouard says he's ashamed of the results. Things have gotten so bad that Pier 1 quit advertising on TV for a full six months, including during the important holiday season.

By making exotic global imports accessible to the average American, Pier 1 rapidly grew to more than 1,000 stores. But like any successful pioneer, it attracted the attention of competitors -- not just other niche players, but Target (TGT) and Wal-Mart (WMT) as well. That kind of aggressive intrusion was bound to have an effect, and Pier 1 hasn't yet figured out how to cope.

SHOOTING STARS.

What happened to Pier 1 isn't unique. My firm recently completed a study of 400 companies that had experienced rapid growth at some point. We wanted to know why some had lost traction in recent years while others managed to maintain or even increase growth.

We were able to identify seven key factors that often cause companies to stumble. Three are external: economic upheavals, changing industry dynamics, and aggressive competition. Four are related to internal dynamics: a lack of consensus, a loss of nerve, a loss of focus, and, as in Pier 1's case, marketing inconsistency.

For years, Kirstie Alley of Cheers fame served as Pier 1's spokeswoman. When the company tired of her, they thought a newer face would shake things up, so they signed one of the stars of Queer Eye for the Straight Guy. But that campaign never really got off the ground, and in late 2004, Pier 1 threw up its hands. Yet another effort was launched in March. Girouard says it has been "slow to resonate" -- so don't be surprised if Pier 1 changes gears again soon.

FICKLE.

It's hard for companies that once dominated a niche to adjust to tough new marketplace dynamics. But inconsistency in marketing is a mistake that too many make. Struggling companies often try to find an advertising silver bullet to a product, pricing, or competitive issue, and when a new campaign doesn't immediately turn things around, they toss it aside and look for the next big idea.

Our research shows that such an approach is misguided. We found that the average age of advertising campaigns across all respondents was 2.3 years. The companies that had the most trouble with growth had campaigns with shorter tenures. In fact, 6 in 10 of the companies that reported slowed or stalled growth had a campaign in the marketplace for less than two years, and nearly half had a campaign that hadn't yet reached its first birthday.

Wendy's is struggling with this issue now in the ultracompetitive fast-food market. In 2002, after a successful 13-year run with Dave Thomas as spokesman, Wendy's found itself having to change when its folksy founder passed away. The burger chain created a new character, a fictional "Mr. Wendy," who didn't last very long. It now has yet another new campaign in the offing as it tries to find their new voice. Not coincidentally, same-store sales were off 3.9% in the second quarter.

FATAL TEMPTATION.

In his book Advertising and the Mind of the Consumer, author Max Southerland cites something he calls the "New Broom Syndrome." He says: "The essence of your competitive advantage lies in the mental capital you have built up in buyers' heads through past advertising. If you cut advertising and nothing happens, there is naturally a greater incentive for the organization to continue to make further advertising cuts."

Southerland goes on to say it can take up to 12 months for a company to see the effects of advertising cuts, and up to 18 months to restart things. Our study suggests that these principles apply not only to companies that cut advertising entirely, but also to those that change their campaigns too often.

Companies have any number of reasons to feel the need to change their advertising approach, from fallen pitchmen to falling sales to (all too commonly) internal boredom with the "same old thing." But the companies with the strongest long-term track records do everything they can to maintain a consistent image in the marketplace, even as competitors come and go and consumer tastes shift.

NO BOTTLE FATIGUE.

The king of consistency is Absolut Vodka. The first ad in its "bottle" campaign launched in 1980, and the series now has well over 1,400 in the series. There's even a Web site devoted to the campaign (www.absolutads.com). The consistency of this campaign is one reason Absolut grew by nearly 15,000% in 15 years.

BMW is also in the consistency hall of fame. As BMW head of marketing Jim McDowell put it: "For 25 years we haven't changed who we are or what our tagline is. A BMW is 'the ultimate driving machine.' That fundamental idea has never varied." BMW recently reported that unit sales for their flagship brand were up 15%.

Hikoh Okuda, general manager for corporate identity at Sony (SNE), summed it up well when he said: "Brand equity is not something that is built in a day." It takes months, even years to seed a solid identity in the marketplace. As with investing, building a strong brand is a function of compounding returns over time. Companies that change their approach too often in search of the Next Big Thing are less likely to succeed than those that find a good strategy and stick with it.

Next month: A wrap-up of the seven factors that cause growth to stall.

Steve McKee is president of McKee Wallwork Cleveland Advertising, an ad agency specializing in working with fast-growth companies and businesses whose ad budgets are under $10 million.

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