by Naomi Klein
For the most part, the ad campaigns at the end of the nineteenth century and the start of the twentieth used a set of rigid, pseudoscientific formulas: rivals were never mentioned, ad copy used declarative statements only and headlines had to be large, with lots of white space — according to one turn-of-the-century adman, “an advertisement should be big enough to make an impression but not any bigger than the thing advertised.”
But there were those in the industry who understood that advertising wasn’t just scientific; it was also spiritual. Brands could conjure a feeling — think of Aunt Jemima’s comforting presence — but not only that, entire corporations could themselves embody a meaning of their own. In the early twenties, legendary adman Bruce Barton turned General Motors into a metaphor for the American family, “something personal, warm and human,” while GE was not so much the name of the faceless General Electric Company as, in Barton’s words, “the initials of a friend.” In 1923 Barton said that the role of advertising was to help corporations find their soul. The son of a preacher, he drew on his religious upbringing for uplifting messages: “I like to think of advertising as something big, something splendid, something which goes deep down into an institution and gets hold of the soul of it…. Institutions have souls, just as men and nations have souls,” he told GM president Pierre du Pont.3 General Motors ads began to tell stories about the people who drove its cars —the preacher, the pharmacist or the country doctor who, thanks to his trusty GM, arrived “at the bedside of a dying child” just in time “to bring it back to life.”
By the end of the 1940s, there was a burgeoning awareness that a brand wasn’t just a mascot or a catchphrase or a picture printed on the label of a company’s product; the company as a whole could have a brand identity or a “corporate consciousness,” as this ephemeral quality was termed at the time. As this idea evolved, the adman ceased to see himself as a pitchman and instead saw himself as “the philosopher-king of commercial culture,”4 in the words of ad critic Randall Rothberg. The search for the true meaning of brands —or the “brand essence,” as it is often called — gradually took the agencies away from individual products and their attributes and toward a psychological/anthropological examination of what brands mean to the culture and to people’s lives. This was seen to be of crucial importance, since corporations may manufacture products, but what consumers buy are brands.
It took several decades for the manufacturing world to adjust to this shift. It clung to the idea that its core business was still production and that branding was an important add-on. Then came the brand equity mania of the eighties, the defining moment of which arrived in 1988 when Philip Morris purchased Kraft for $12.6 billion —six times what the company was worth on paper. The price difference, apparently, was the cost of the word “Kraft.” Of course Wall Street was aware that decades of marketing and brand bolstering added value to a company over and above its assets and total annual sales. But with the Kraft purchase, a huge dollar value had been assigned to something that had previously been abstract and unquantifiable —a brand name. This was spectacular news for the ad world, which was now able to make the claim that advertising spending was more than just a sales strategy: it was an investment in cold hard equity. The more you spend, the more your company is worth. Not surprisingly, this led to a considerable increase in spending on advertising. More important, it sparked a renewed interest in puffing up brand identities, a project that involved far more than a few billboards and TV spots. It was about pushing the envelope in sponsorship deals, dreaming up new areas in which to “extend” the brand, as well as perpetually probing the zeitgeist to ensure that the “essence” selected for one’s brand would resonate karmically with its target market. For reasons that will be explored in the rest of this chapter, this radical shift in corporate philosophy has sent manufacturers on a cultural feeding frenzy as they seize upon every corner of unmarketed landscape in search of the oxygen needed to inflate their brands. In the process, virtually nothing has been left unbranded. That’s quite an impressive feat, considering that as recently as 1993 Wall Street had pronounced the brand dead, or as good as dead.
The Brand’s Death (Rumors of Which Had Been Greatly Exaggerated)
The evolution of the brand had one scary episode when it seemed to face extinction. To understand this brush with death, we must first come to terms with advertising’s own special law of gravity, which holds that if you aren’t rocketing upward you will soon come crashing down.
The marketing world is always reaching a new zenith, breaking through last year’s world record and planning to do it again next year with increasing numbers of ads and aggressive new formulae for reaching consumers. The advertising industry’s astronomical rate of growth is neatly reflected in year-to-year figures measuring total ad spending in the U.S. (see Table 1.1), which have gone up so steadily that by 1998 the figure was set to reach $196.5 billion, while global ad spending is estimated at $435 billion.5 According to the 1998 United Nations Human Development Report, the growth in global ad spending “now outpaces the growth of the world economy by one-third.”
This pattern is a by-product of the firmly held belief that brands need continuous and constantly increasing advertising in order to stay in the same place. According to this law of diminishing returns, the more advertising there is out there (and there always is more, because of this law), the more aggressively brands must market to stand out. And of course, no one is more keenly aware of advertising’s ubiquity than the advertisers themselves, who view commercial inundation as a clear and persuasive call for more — and more intrusive —advertising. With so much competition, the agencies argue, clients must spend more than ever to make sure their pitch screeches so loud it can be heard over all the others. David Lubars, a senior ad executive in the Omnicom Group, explains the industry’s guiding principle with more candor than most. Consumers, he says, “are like roaches —you spray them and spray them and they get immune after a while.”6
So, if consumers are like roaches, then marketers must forever be dreaming up new concoctions for industrial-strength Raid. And nineties marketers, being on a more advanced rung of the sponsorship spiral, have dutifully come up with clever and intrusive new selling techniques to do just that. Recent highlights include these innovations: Gordon’s gin experimented with filling British movie theaters with the scent of juniper berries; Calvin Klein stuck “CK Be” perfume strips on the backs of Ticketmaster concert envelopes; and in some Scandinavian countries you can get “free” long-distance calls with ads cutting into your telephone conversations. And there’s plenty more, stretching across ever more expansive surfaces and cramming into the smallest of crevices: sticker ads on pieces of fruit promoting ABC sitcoms, Levi’s ads in public washrooms, corporate logos on boxes of Girl Guide cookies, ads for pop albums on takeout food containers, and ads for Batman movies projected on sidewalks or into the night sky. There are already ads on benches in national parks as well as on library cards in public libraries, and in December 1998 NASA announced plans to solicit ads on its space stations. Pepsi’s ongoing threat to project its logo onto the moon’s surface hasn’t yet materialized, but Mattel did paint an entire street in Salford, England, “a shriekingly bright bubblegum hue” of pink —houses, porches, trees, road, side walk, dogs and cars were all accessories in the televised celebrations of Barbie Pink Month.7 Barbie is but one small part of the ballooning $30 billion “experiential communication” industry, the phrase now used to encompass the staging of such branded pieces of corporate performance art and other “happenings.”8
Table 1.1
Total Overall Ad Expenditures in the United States, 1915, 1963, 1979-98
That we live a sponsored life is now a truism and it’s a pretty safe bet that as spending on advertising continues to rise, we roaches will be treated to even more of these ingenious gimmicks, making it ever more difficult and more seemingly pointless to muster even an ounce of outrage.
But as mentioned earlier, ther
e was a time when the new frontiers facing the advertising industry weren’t looking quite so promising. On April 2, 1993, advertising itself was called into question by the very brands the industry had been building, in some cases, for over two centuries. That day is known in marketing circles as “Marlboro Friday,” and it refers to a sudden announcement from Philip Morris that it would slash the price of Marlboro cigarettes by 20 percent in an attempt to compete with bargain brands that were eating into its market. The pundits went nuts, announcing in frenzied unison that not only was Marlboro dead, all brand names were dead. The reasoning was that if a “prestige” brand like Marlboro, whose image had been carefully groomed, preened and enhanced with more than a billion advertising dollars, was desperate enough to compete with no-names, then clearly the whole concept of branding had lost its currency. The public had seen the advertising, and the public didn’t care. The Marlboro Man, after all, was not any old campaign; launched in 1954, it was the longest-running ad campaign in history. It was a legend. If the Marlboro Man had crashed, well, then, brand equity had crashed as well. The implication that Americans were suddenly thinking for themselves en masse reverberated through Wall Street. The same day Philip Morris announced its price cut, stock prices nose-dived for all the household brands: Heinz, Quaker Oats, Coca-Cola, PepsiCo, Procter and Gamble and RJR Nabisco. Philip Morris’s own stock took the worst beating.
Bob Stanojev, national director of consumer products marketing for Ernst and Young, explained the logic behind Wall Street’s panic: “If one or two powerhouse consumer products companies start to cut prices for good, there’s going to be an avalanche. Welcome to the value generation.”9
Yes, it was one of those moments of overstated instant consensus, but it was not entirely without cause. Marlboro had always sold itself on the strength of its iconic image marketing, not on anything so prosaic as its price. As we now know, the Marlboro Man survived the price wars without sustaining too much damage. At the time, however, Wall Street saw Philip Morris’s decision as symbolic of a sea change. The price cut was an admission that Marlboro’s name was no longer sufficient to sustain the flagship position, which in a context where image is equity meant that Marlboro had blinked. And when Marlboro —one of the quintessential global brands —blinks, it raises questions about branding that reach beyond Wall Street, and way beyond Philip Morris.
The panic of Marlboro Friday was not a reaction to a single incident. Rather, it was the culmination of years of escalating anxiety in the face of some rather dramatic shifts in consumer habits that were seen to be eroding the market share of household-name brands, from Tide to Kraft. Bargain-conscious shoppers, hit hard by the recession, were starting to pay more attention to price than to the prestige bestowed on their products by the yuppie ad campaigns of the 1980s. The public was suffering from a bad case of what is known in the industry as “brand blindness.”10
Study after study showed that baby boomers, blind to the alluring images of advertising and deaf to the empty promises of celebrity spokespersons, were breaking their lifelong brand loyalties and choosing to feed their families with private-label brands from the supermarket —claiming, heretically, that they couldn’t tell the difference. From the beginning of the recession to 1993, Loblaw’s President’s Choice line, Wal-Mart’s Great Value and Marks and Spencer’s St. Michael prepared foods had nearly doubled their market share in North America and Europe.11 The computer market, meanwhile, was flooded by inexpensive clones, causing IBM to slash its prices and otherwise impale itself. It appeared to be a return to the proverbial shopkeeper dishing out generic goods from the barrel in a prebranded era.
The bargain craze of the early nineties shook the name brands to their core. Suddenly it seemed smarter to put resources into price reductions and other incentives than into fabulously expensive ad campaigns. This ambivalence began to be reflected in the amounts companies were willing to pay for so-called brand-enhancing advertising. Then, in 1991, it happened: overall advertising spending actually went down by 5.5 percent for the top 100 brands. It was the first interruption in the steady increase of U.S. ad expenditures since a tiny dip of 0.6 percent in 1970, and the largest drop in four decades.12
It’s not that top corporations weren’t flogging their products, it’s just that to attract those suddenly fickle customers, many decided to put their money into promotions such as giveaways, contests, in-store displays and (like Marlboro) price reductions. In 1983, American brands spent 70 percent of their total marketing budgets on advertising, and 30 percent on these other forms of promotion. By 1993, the ratio had flipped: only 25 percent went to ads, with the remaining 75 percent going to promotions.
Predictably, the ad agencies panicked when they saw their prestige clients abandoning them for the bargain bins and they did what they could to convince big spenders like Procter and Gamble and Philip Morris that the proper route out of the brand crisis wasn’t less brand marketing but more. At the annual meeting of the U.S. Association of National Advertisers in 1988, Graham H. Phillips, the U.S. chairman of Ogilvy & Mather, berated the assembled executives for stooping to participate in “a commodity marketplace” rather than an image-based one. “I doubt that many of you would welcome a commodity marketplace in which one competed solely on price, promotion and trade deals, all of which can easily be duplicated by competition, leading to ever-decreasing profits, decay and eventual bankruptcy.” Others spoke of the importance of maintaining “conceptual value-added,” which in effect means adding nothing but marketing. Stooping to compete on the basis of real value, the agencies ominously warned, would spell not just the death of the brand, but corporate death as well.
Around the same time as Marlboro Friday, the ad industry felt so under siege that market researcher Jack Myers published Adbashing: Surviving the Attacks on Advertising, a book-length call to arms against everyone from supermarket cashiers handing out coupons for canned peas to legislators contemplating a new tax on ads. “We, as an industry, must recognize that adbashing is a threat to capitalism, to a free press, to our basic forms of entertainment, and to the future of our children,” he wrote.13
Despite these fighting words, most market watchers remained convinced that the heyday of the value-added brand had come and gone. The eighties had gone in for brands and hoity-toity designer labels, reasoned David Scotland, European director of Hiram Walker. The nineties would clearly be all about value. “A few years ago,” he observed, “it might have been considered smart to wear a shirt with a designer’s logo embroidered on the pocket; frankly, it now seems a bit naff.”14
And from the other side of the Atlantic, Cincinnati journalist Shelly Reese came to the same conclusion about our no-name future, writing that “Americans with Calvin Klein splashed across their hip pocket aren’t pushing grocery carts full of Perrier down the aisles anymore. Instead they’re sporting togs with labels like Kmart’s Jaclyn Smith and maneuvering carts full of Kroger Co.’s Big K soda. Welcome to the private label decade.”15
Scotland and Reese, if they remember their bold pronouncements, are probably feeling just a little bit silly right now. Their embroidered “pocket” logos sound positively subdued by today’s logomaniacal standards, and sales of name-brand bottled water have been increasing at an annual rate of 9 percent, turning it into a $3.4 billion industry by 1997. From today’s logo-quilted perch, it’s almost unfathomable that a mere six years ago, death sentences for the brand seemed not only plausible but self-evident.
So just how did we get from obituaries for Tide to today’s battalions of volunteer billboards for Tommy Hilfiger, Nike and Calvin Klein? Who slipped the steroids into the brand’s comeback?
The Brands Bounce Back
There were some brands that were watching from the sidelines as Wall Street declared the death of the brand. Funny, they must have thought, we don’t feel dead.
Just as the admen had predicted at the beginning of the recession, the companies that exited the downturn running were the ones who opted
for marketing over value every time: Nike, Apple, the Body Shop, Calvin Klein, Disney, Levi’s and Starbucks. Not only were these brands doing just fine, thank you very much, but the act of branding was becoming a larger and larger focus of their businesses. For these companies, the ostensible product was mere filler for the real production: the brand. They integrated the idea of branding into the very fabric of their companies. Their corporate cultures were so tight and cloistered that to outsiders they appeared to be a cross between fraternity house, religious cult and sanitarium. Everything was an ad for the brand: bizarre lexicons for describing employees (partners, baristas, team players, crew members), company chants, superstar CEOs, fanatical attention to design consistency, a propensity for monument-building, and New Age mission statements. Unlike classic household brand names, such as Tide and Marlboro, these logos weren’t losing their currency, they were in the midst of breaking every barrier in the marketing world —becoming cultural accessories and lifestyle philosophers. These companies didn’t wear their image like a cheap shirt — their image was so integrated with their business that other people wore it as their shirt. And when the brands crashed, these companies didn’t even notice — they were branded to the bone.
So the real legacy of Marlboro Friday is that it simultaneously brought the two most significant developments in nineties marketing and consumerism into sharp focus: the deeply unhip big-box bargain stores that provide the essentials of life and monopolize a disproportionate share of the market (Wal-Mart et al.) and the extra-premium “attitude” brands that provide the essentials of lifestyle and monopolize ever-expanding stretches of cultural space (Nike et al.). The way these two tiers of consumerism developed would have a profound impact on the economy in the years to come. When overall ad expenditures took a nosedive in 1991, Nike and Reebok were busy playing advertising chicken, with each company increasing its budget to outspend the other. (See Table 1.2.) In 1991 alone, Reebok upped its ad spending by 71.9 percent, while Nike pumped an extra 24.6 percent into its already soaring ad budget, bringing the company’s total spending on marketing to a staggering $250 million annually. Far from worrying about competing on price, the sneaker pimps were designing ever more intricate and pseudoscientific air pockets, and driving up prices by signing star athletes to colossal sponsorship deals. The fetish strategy seemed to be working fine: in the six years prior to 1993, Nike had gone from a $750 million company to a $4 billion one and Phil Knight’s Beaverton, Oregon, company emerged from the recession with profits 900 percent higher than when it began.
