Natural High

The similarities between dependence on month-to-month retail promotions and addiction to cocaine are chilling. Similarity No. 1: Both give short bursts of euphoria and a sense of wide popularity. Deeply discounting popular items, like handing out free cocaine, will win you many intense, temporary friendships. You will see a sharp uptick of traffic into your store, or your apartment. But the consumers will linger only long enough to "Hoover" your loss-leaders and then disappear, leaving cigarette burns on the coffee table. They are not likely to stick around for long. Similarity No. 2: Like a high, the infusion of promotional dollars results in a grin that lasts just long enough for your teeth to dry and then disappears. A promotion will likely get you through the night with lots of jovial activity, but when morning comes, as it must, and money is needed for food and rent (or brand awareness), the coffers are empty. There is no accrual in the brand bank from nighttime binges on promotions. Similarity No. 3: After the stimuli are removed, depression ensues, and there is an overpowering need for another jolt of short-term spending. And so it goes. Having watched many wonderful brands suffer these vicissitudes, I wonder, is this any kind of life? The fact is, our brands are in business to make money, and we cannot make money in the long run by selling wares for less than they're worth. Should we throw out promotions and go cold turkey? Of course not. In the retail world, promotions are an essential part of the marketing mix. What I'm suggesting is an intervention, followed by partial withdrawal. Years ago I had a national client who was running promotions 50 weeks out of the year. They knew it was driving their brand value into the dirt, but they felt they had few other ways to bring customers into stores. They knew they weren't going to grow the brand by introducing higher-end products—not when they were known for cutting deals in the alleyway. Eventually, other brands would start cutting the same deals across the street. Yet they could not stop. Rehabilitating the brand required a plan. From 50 promotions a year, we cut it down to 40, then 20 the following year. Yes, there were jitters in the hallways. Lots of cigarettes were smoked. The trick, however, was replacing the promotional crutch with something more meaningful. We replaced "2 for $1.99" with messages about new products or repackagings of existing products. Essentially, we replaced "cheap" with "new" and in three years gave the brand a credibility for something beyond price. Along the way, average profits tripled. Not sales, profits. Does this client still get off on promotions now and then? Well, yes, don't tell mom. Every other month or so we have spectacular blowouts where we're practically givin' it away, customers are comin' in and out all night long, and the place is just nuts. But because the brand now stands for something, the promotions are added value, not the only value. We discovered that brand will get you through times of no promotion better than promotions will get you through times of no brand.

Brand Marketing

Natural High

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