Real Salesmanship In Print —Strategy in Advertising ISSUED BY LORD & THOMAS Advertising CHICAGO 132 North Wabash Avenue N E W YORK 290 Fifth Avenue Copyright 1911 by LORD & THOMAS Apology Many ideas in this book, as we frankly confess, have been gathered from countless sources. It is utterly impossible to assign proper credit. But they to whom they belong gave them freely to us. And we pass them on just as freely to others. Perhaps this will apologize to readers who find some progeny of theirs in the pages which follow. It may also be stated that these revelations have been discussed with many clients. And they have disclaimed to a man any wish to monopolize progressive ideas in selling. They believe, with us, that modern business is best served by interchanged experience. And they, as we do, practice that belief. Index PAGE Introduction 9 Our Cautious Beginnings 13 The Plan of Appeal 23 The Many-Man Power 31 Our Record of Results 37 Strategy in Advertising —The Climax of Salesmanship ...... 41 Strategy Applied to Quick Introduction 47 Strategy Applied to Human Nature 61 Business Strategy 69 Telling Men How To Make Money 79 Some Details 87 5 Introduction Introduction LOSE to forty years ago, two delightful men of exceptional capacity formed a partnership in advertising. The firm was called Lord & Thomas. Those were primitive days when advertising commanded but slight respect. Many of its patrons were fakers. Many of its statements were utterly untrue. Its influence was minimized by lack of integrity as well as by lack of ability. Men who dealt in advertising shared in this disrespect. The advertiser selected his agent by means of competitive bids. And the agent bought his space through bargaining and bluff. There were no fixed prices, no recognized values. The man who paid least usually paid too much, considering the way in which he used what he bought. Into this field came these two men with very high ideals. They were strong and energetic. And their influence did much to bring the advertising business up to their personal standards. Since the very beginning, Lord & Thomas has stood for high purpose and utter integrity. That fact, primarily, is due to its founders—to gentlemen of what is now called the "old school." One is dead and one retired, so these tributes are paid to the past. But their long-time associates, 9 who became their successors, have made their principles our fundamental law. * * * Naturally these men in time gathered around them younger men of their class. And they were particularly fortunate in picking men of capacity. These younger men, growing up in this atmosphere, imbibed the spirit of the men above. Of all the famous names in the roster of advertising, a pretty large share, at one time or another, were enrolled in this concern. Some of these younger men in time outgrew their masters. Not in ideals, not in purpose, but in accomplishment. For the development of advertising has been so rapid that only young men kept pace with progression. These younger men—now not so young—eventually succeeded to their masters' places. And with those places came to them the heritage of an honored corporation name. The men who now own and dominate the concern each started in here at $10 per week. We deal in this book with the modern Lord & Thomas, to which hundreds of men have contributed something. But its principles remain those of its founders. And its present position is but the fruition of their hopes. 10 Our Cautious Beginnings Our Cautious Beginnings T SOUNDS rather like a confession, but the fact is this: A very large share of our success is due to our care in accepting accounts. Our reputation for winning is primarily due to our skill in picking winners. It must be so. Four-fifths of the things which men want to advertise could never be made successful. For us to attempt them would simply invite a certain, all-round disaster. In other lines, conditions exist which make success too difficult. Unless we can find out a feasible way to correct them, the results can't repay the effort. This is a personal service business. All we have to sell is the time of our able men. And such men are not plentiful. To waste time and ability on things that cannot be done would mean to sacrifice that much efficiency. This is also a line where prestige counts for much. W e cannot afford to have it blemished by failure. An unprofitable campaign would cost us more than it ever could cost our client. W e believe, in addition, that the good of the business demands from all that are in it the elimination of unwise advertising. So we are exceedingly cautious in accepting accounts. This attitude of ours has been called independence. The man who called it cowardice came 13 nearer to the truth. We regard it as simply good business. * * * Our caution in the matter has nothing to do with the amount of intended expenditure. We have refused undertakings, again and again, which would, for a time, have been among our largest accounts. And we are all the time accepting little beginnings because of the prospects we see in them. Most of our business is, in fact, made up of accounts which started with small campaigns. It was years, with some of them, before we made any profit. Yet we are looking all the time for more opportunities like them. Our attitude depends entirely on prospects. We are willing to plant when we know the harvest won't consist of tares. * * * One thing we consider is quality. Will the article in question hold trade when we get it? Does there exist a rival article which people will like better? The man who builds trade when merit doesn't deserve it is building on shifting sand. All that advertising can do is to make the first sale. The future depends on the article. And, when the first sale can't be made at a profit, the question of repeat orders becomes immensely important. We are often obliged to tell a manufacturer that his article won't stand the test. He may lure people to try it, but they will not continue to buy it. 14 In very few lines can one sell at a profit that which won't resell itself. * * * Let us suppose, for example, that a food product is offered for consideration. If the article has been sold in a rather large way —sold to the same users again and again—the visible probabilities are all in its favor. To make certain we may go to the users. We may ask why they bought it—why they continue to buy. To learn if those reasons appeal to new users we may make an extended canvass. W e may take samples, perhaps, to a thousand homes, and talk with the housewives about them. All to discover what sort of reception the article would receive. We may then go to dealers to learn what they have to compete with it. We measure up, so far as we can, the strength of that competition. * * * If the article is new, and the demand is uncertain, we may suggest marketing it for a time without advertising. We may suggest sampling, canvassing, demonstrations, etc., to learn how it repeats where sold. W e are at this writing starting a food campaign which was delayed for a year, at our suggestion, for such tests as this. Or we may suggest what we call a test campaign. That means a limited amount of advertising, in a limited territory, as a demonstration. 15 Thus the question is put to a vote of the users. We let the thousands decide what the millions will do. Such a vote, in distributed territories, has never yet proved misleading. Most of the failures in advertising come from guessing at things which could just as well be proved. We find out if an article can carry a precinct before attempting to carry the country. * * * There is also the question of margin. Is that large enough to pay the cost of the selling? The cost of getting a customer depends very largely on the percentage of people to whom a thing will appeal. The profit per customer depends on the amount of consumption. Unless we figure out carefully this cost and result we may lose out through lack of margin. The want of fair profit, if it exists, is something to be adjusted. An article worth advertising is good enough to command a fair price. An advertised article need not pay an excessive profit to dealers. And advertising should be made to lessen cost of distribution. Here our experience in countless lines often becomes of prime value. W e suggest how to create extra margins when needed, and without serious trade disturbance. Many of our clients pay for all of their advertising out of these added margins. Some of our greatest successes have been created without spend16 ing one dollar, at any time, beyond this increased profit. * * * Another thing to look out for is the danger of substitution. There are a great many lines where substitution by dealers kills from half to two-thirds of the trade. Rare is the article which attains big success against such a handicap. Substitution cannot always be entirely eliminated, but there are ways to minimize it. And it must be reduced to modest proportions before an advertising campaign can be advocated. This is one of our gravest problems. And it must be solved in the original plans if one is to solve it at all. It is folly to raise crops for others to garner. Foresight in this matter is an essential. Without it, the most brilliant campaign might result in disaster. In many other cases results have been multiplied by simply taking proper precautions. Toasted Corn Flakes has succeeded despite substitution. But the Kellogg concern is not getting more than forty per cent of the trade it created. And fortunes are spent on advertisements aimed merely to defend that percentage. Suppose the same trade, at the same expense^ had been built around a name like Post Toasties. How much more would the trade have been worth ? Suppose the Kodak had been called Eastman's Camera. Suppose Uneeda Biscuit had been named National Soda Crackers. Consider how impregnable are their positions today compared with what 17 they might have been had they overlooked the trademark foundation, * * * Sometimes the very name of an article makes it a difficult proposition. Sometimes the name alone makes successful advertising impossible. Perhaps it is imitative, so that every mention advertises a dominant competitor. Perhaps it neutralizes selling arguments which we would need to use* Or it may invite substitution. In dozens of cases this fault must be remedied before we can see our way clear to success. Many of the names used on products we advertise have been coined by us. We can cite numerous instances where a change in name has multiplied the results of the advertising. W e know cases where the name has done more for the article than all other selling arguments. One of our greatest successes of the past six months is due, apparently, mainly to a name we coined. An enormous business, long established, was doubled in four months. And the main element we added, in our estimation, was a name which brought to one maker the trade which had heretofore been divided. On the other hand, we have run across quite a number of failures undoubtedly due to a name. * * # In justice to all, these questions must all be considered—these problems solved—before we accept an account. 18 The answer, sometimes, requires much investigation. The cost to us, in time and money, is often a considerable item. But we welcome the opportunities. If we find that a line is impossible for us we will tell you the reasons. And you will agree with us, in all probability. If we merely find difficulties to be overcome, we will suggest the remedies. If we find uncertainties, we will tell you how to prove them out. If we accept an account you may be utterly sure that we see our way clear to success. We have no time to waste on advertising which cannot be made to pay. And we do not intend, if we can avoid it, to be debited with a mistake. * * * This doesn't apply to new clients alone. Our oldest clients, again and again, offer new appropriations which we turn down. With our largest client, in the past few months, we have refused three new undertakings. They are not always submitted as definite projects. They are submitted as possibilities on which men want our judgment. And it has come to be known, among those who know best, that we do not attempt the impossible. 19 The Plan of Appeal The Plan of Appeal H E N an account is accepted it is handed over to one of our salesmen-in-print. This man then conducts a search for selling arguments. The vital factor of salesmanship-inprint lies in the plan of appeal. This is a fact little realized. Salesmanship is mainly strategy. Most clever writers believe that they can write advertising. But a house-to-house canvasser is a great deal more apt to develop into an ad-writer. None of our master salesmen came from literary fields. A literary training has nothing to do with it. The genius lies in finding out the most enticing, most convincing method of appeal. And that requires a knowledge of incentive. The success of a newspaper man depends on his "nose for news." The success of an ad-writer depends on that instinct—that very rare instinct— for picking out winning facts. Men who can do this command very large salaries. One man in our Copy Department receives as much as the President of the United States Steel Corporation. Others are paid in proportion. In this department we employ none but premiers. And our chiefest asset is this able corps. When one is selling to millions, even a slight difference in the effects may become an immensity. 23 There is no room for mediocrity in salesmanship-inprint A visit to the factory is always one step in our investigations. The first essential is full information. Sometimes a man who knows conditions can, without further knowledge, work out his argument. But it is usually necessary to go to prospective buyers. The safest way is to meet in person the average people whom one meets in print. A house-to-house canvass develops selling arguments quicker than anything else. One has no idea how many theories are upset by facts until he meets his prospective trade. * * * One of our ablest salesmen-in-print spent $1,000 worth of time, on one account, in tramping from farm to farm. He was learning what arguments would induce a farmer to put in acetylene gas. The advertising in question, ever since, has been founded on that information. Another traveled four thousand miles, facing all sorts of hardships, to convince himself of the basis which lay back of some advertised securities. To settle one point in one line of argument we sent out letters to 12,000 physicians. To develop one argument we made a canvass of 61 poorhouses and eight prisons. 24 To develop another we were compelled to interview President Taft, and the Governor of every State. * * # Before starting the advertising of Van Camp's Pork and Beans we made a far-reaching canvass. And we found, among other things, that 96 per cent of the housewives baked their own beans. As a result, we directed our efforts toward that 96 per cent. A competing campaign, conducted without this knowledge, aimed only at people already using canned beans. That meant only 4 per cent. That campaign failed, and the fact was undoubtedly due to scant information. Before starting the advertising of Quaker Oats we spent three months on investigations, employing 130 men. * * 5JC In most lines these investigations are repeated from time to time. When goods begin selling we want to know to what class of people, or to what percentage, they sell. That guides us in selecting mediums. Or we may wish to learn which one of our arguments appeals to the greatest number. W e often revise well-paying campaigns as a result of this information. Question after question comes up in our business which can only be answered by going to actual customers. We employ a great many men, in the course of a year, to ascertain these facts. 25 One campaign which came up to us had utterly failed because of the attitude of dealers. We sent out two travelers on a two weeks' trip and discovered a way to completely alter that attitude. One successful line of ours suffered big losses through widespread substitution. We kept six men going from store to store until they worked out a way to correct it. One dealer, eight hundred miles away from us, reported that one of our advertised articles had arrived in spoiled condition. By the very next train we had a man on the way to him. If that could happen in one case it could happen in a hundred. And advertising never could stand against it. One of our clients reported some cities where he found trade was diminishing. We sent men to those cities to discover the reason. And we traced the trouble to grouchy agents who quibbled with claims resulting from a guaranty. All such investigations are conducted without cost to our clients. In many cases they know nothing about them. We consider that we are mutually interested in whatever affects the advertising. * * * In some lines we patronize clipping bureaus. Thus we see every comment made in print about the line in question. W e do this in some lines—like automobiles— to keep fully in touch with the trend of opinion. In other lines—like oatmeal and beans—we do it 26 to learn of every expression made by experts about their food value, etc. * * * Some man or woman in our employ writes to every important advertiser. He or she writes as an inquirer, giving the home address. Thus we get every follow-up system. We learn at once of any new idea employed by anyone. We keep on the mailing list of every advertiser who attempts to compete with our clients. We get the circulars which he sends to consumers, and the circulars he sends to dealers. We let no one find out much quicker than we any new competitive move. * * * In mail order lines we have referred to us all indicative letters from inquirers and buyers. Sometimes hundreds of these letters are submitted to us at a time, and the man who writes the copy reads them all. Thus he discovers how his arguments appeal. He learns what questions his copy fails to answer. He finds out why the buyers buy, and why some others don't. He keeps in close touch with his audience. * * * Our whole success in salesmanship lies in our mode of appeal—in the science of strategy—in touching the chord that responds. And this comes largely from the infinite pains we take to get information. 27 The best selling ability often fails because it is misdirected. Millions are wasted by men who don't know their customers. And they don't try to get acquainted. These four mottoes are kept always before us: "Genius is the art of taking pains." "The only safe guide is an average." "Never act without full information." "Use nothing which hasn't a news value." 28 The Many-Man Power The Many-Man Power N O T H E R contribution which we made to advertising has been the systematic combination of ideas. There have always been hap-hazard consultations. We turned them into organized conventions, and made them the invariable rule. Before a plan of campaign is adopted, the Copy Man's proposals come up to our Advisory Board. Also all the information gathered by the men in charge. This Board comprises the ablest men on our staff. It consists of our Copy Men, our Plan Men, and our Experts in Merchandising. The purpose of this conference is to bring to bear many ideas and experiences. To learn how a plan looks from twenty expert view-points. To mass our skill, to avoid mistakes, and to bring every effort to the standard of efficiency fixed by these men as a whole. * * * Each man on this Board has been chosen by us because of unusual ability. Each is a master salesman. All of them live in a vortex of advertising —in the midst of a thousand experiences. Each has for years devoted all of his time to conducting important campaigns. And each reviews, in all its aspects, the work of all the others. 31 Each has a hand in all our undertakings. Each has been taught by a myriad successes, also by some mistakes. All have been broadened by these countless conferences. All are kept on their mettle, spurred to the utmost by ceaseless rivalry. This is, we believe, the ablest corp,s which the advertising field has developed. And their brilliant results seem to prove it. * * * An organization like this is of necessity made up of varying kinds of ability. One excels in one line and one in another. Each has his weakness, and each his pre-eminence. Were each man permitted to work by himself our service would naturally vary. There could be no such thing as a Lord & Thomas standard. But this Advisory Board fixes the standard. And that standard consists of the final fruition of their combined growth and experience. No man's idea can get by this Board unless it measures up to this standard. This standard, furthermore, is being daily advanced. Every new effort, idea or experience unconsciously adds something to it. We marvel sometimes at our rapid growth. Many a campaign which went through last year could never get through today. Each man, of course, has his own individuality, and we never try to interfere with it. Also, every campaign is on different lines from any that ever preceded. We abhor imitation—combat similarity. 32 But the right and the wrong do not vary. Human nature is perpetual. There are principles in advertising wrought out by experience, which it is folly to forfeit. It is for this Board to see that every idea conforms with the fundamentals. It must also see that nothing is ill-done which any man knows how to better. * * # The ablest men make mistakes. Practically every campaign submitted to our Board has some argument which isn't worth while. Some make an appeal which doesn't strike home. Some contain boomerangs. A good many advertisements which fail of effect are destroyed by a single sentence which the writer failed to weigh. The selling force of every ad lies in its final impression. Every day some man on our Board points out a weakness which would kill an ad. The best copy writer will often overlook the very strongest point of appeal. He will take up the wrong key-note. Some man on the Board will discover the error, and a new selling force is developed. Men vary in temperament and habit, in likes and dislikes, in wants and inclinations. It is practically impossible for any one man, however well schooled, to measure up human nature. But a score of men, all masterly salesmen, give us a pretty sure average. Every man on our staff knows that this teamwork adds more to his campaigns than he ever 33 contributes. All have lost their respect for the old-time, one-man power. No man working alone can ever hope to compete with this organized efficiency. ^C 5{C 5{? Whenever possible, we invite the advertiser or his representative to be present at this conference. Some advertisers bring three or four of their aides. Thus all their experience in this particular line is combined with ours in general. As can well be imagined, when a plan gets the O. K. of such a convention it is usually mighty effective. But the combined responsibility doesn't end with the meeting. Every advertisement in every campaign is submitted in proof to every man on this Board. Each man's first duty every morning is to scan these proofs for other men's shortcomings. Then to suggest any new idea which the ad suggests to him. It is thus that we make every Lord & Thomas campaign mean what it ought to mean—the best that we all can develop. 34 Our Record of Results Our Record of Results As an example of our exactness in mapping out a campaign let us mention a single system. Many of our clients key their advertisements. They key each medium, each separate piece of copy. They key not only the cost per reply, for replies have a varying value. They follow the inquiry through to the sale, and find out the cost per sale. Thus they learn which mediums pay best, which arguments, which method of approach. They learn that of inquiries secured in one way only 10 per cent will buy. Of inquiries secured in another way 60 per cent may buy. These results, of course, are reported to us. And we have in our office an elaborate system by which they are all recorded. It has cost us to date over $100,000. And our clients have spent many millions of dollars in securing the facts behind it. This record tells what each separate medium did on scores of different lines. It tells which pay and which don't pay. It tells what price each medium is worth. It tells what sort of copy pays best on each sepaarate line. It tells what wins the curious inquirer and what wins the buyer. Hundreds of methods are compared one with another, down to the net result. It shows how best to reach the people to whom a certain line appeals. It answers every question about style of copy, size of type or space. 27 Such records worked out in one line prove very misleading when applied to another. But here the records are both composite and separate. And they are so extensive that on any line they afford an infallible average. On keyed lines of advertising this Record of Results saves a great deal of wasteful experiment. On lines not keyed it saves enormous losses. It is safe to say that, without the guide of these countless experiences, the average advertiser would spend one-third more to accomplish the same result. If that is so, that record is worth to the clients of this Agency over $2,000,000 per year. So far as we know, there is no other such Record of Results on Advertising in existence. 38 Strategy in Advertising -The Climax of Salesmanship Strategy in Advertising —The Climax of Salesmanship E have now come to deal with a new phase of advertising—the most important contribution we have made to the art. W e are going to uncover, for the first time, some methods of ours which have revolutionized advertising in our institutions. We call them Strategy. This is a development of the past three years. It is more important, in our estimation, than all that we learned in all the years that preceded. It is the climax of all salesmanship-in-print. The idea was born in our institution. It has been nurtured and developed here. In outlining its principles for the first time we hereby lay claim to discovery. * * * Some of the methods employed are not new in entirety. But we were the first, let it be understood, to formulate those methods into fixed principles. From rambling ideas we created a science. It was so with "Reason-Why" copy. We were not first to employ it. But we were the first to embody it into a principle of universal application. "Reason-Why" will forever stand for Lord & Thomas. 41 It was so with salesmen-in-print. We were not first to pay a startling salary to some rare genius in selling goods to the millions. But we were the first to make this a fixed policy. And nobody since has ever bid for such talent the prices we always stand ready to pay. It was so with the Advisory Board. We were not first to consult, in a desultory way, on plans and arguments. But we were first to make this systematic. We were first to mass on every account a wealth of experienced ability. So, in outlining this new advance—this greatest step of all—we wish to emphasize its origin. It will not remain long exclusive. New ideas of great value in advertising never remained uncopied. We copy them ourselves. But in this science of strategy we have no fear of rivalry. We have gone too far to be overtaken. As with "Reason-Why" copy, as with Master Salesmen, as with the Advisory Board, we shall manage, we hope, to keep ahead of our imitators. It is merely a matter of pride when we register thus our claim to this innovation. # * * This Science of Strategy has accomplished for advertising some very important advances. It has made possible, for one thing, an immediate, country-wide success. It has enabled new advertisers, inside of three months, to gain such a start as took years in the old way. 42 It avoids the enormous investment which often used to be necessary before the cumulative results overtopped the expense. It has taken from advertising about all its uncertainties. It has made the risk so trifling that any man, with a fair possibility, will gladly undertake it. Again and again, it has saved enough in the cost of distribution to pay the whole cost of the advertising. Again and again, it has enabled advertising to pay dividends from the start. It has placed new products, from the very beginning, on a profitpaying basis. It has turned failures to success, simply by one bright move. It has multiplied results through a single maneuver. All these things, and more, will be illustrated to you by the examples we are going to cite. * * * The old-time advertiser, when he set out to capture a citadel of trade, had to prepare for a siege. He had to provision his printed salesmen for a pretty long time to come. With one of our successes, started long ago, the advertiser at one time had spent $370,000 more than the sales brought back. With another of our clients—very successful today—it took $650,000 to carry him to the turn of the tide. Another spent all he had, and $42,000 more, before the golden tide of millions came his way. 43 A big neighboring agency had to compromise with its creditors before its greatest success became profitable. Such was the story, a hundred times repeated, with advertising ventures which won. And such was the story, a thousand times repeated, with ventures which ran out of funds. Nine men in ten spent all their resources, or exhausted their nerve, before the tide turned their way. And a goodly percentage of the other tenth skirted the edges of bankruptcy. Strategy has ended that. On no campaign which we conduct today does one risk large disaster. Few involve any large investment, and none until the investment has been proved secure. Big, immediate successes are created today without any considerable risk. The advertiser, in some of them, has never invested one dollar of existing resources. Trade is created with astounding rapidity. Business is built up almost over-night. So much for generalities. Now let us illustrate by specific examples what we mean by the Science of Strategy. 44 S t r a t e g y Applied to Quick Introduction S t r a t e g y Applied to Quick Introduction E do not claim to have discovered the Coupon, But we do claim—and justly —to have worked out most of its best applications. We do not claim to have originated Sampling. But the most effective Sampling plans ever employed have been devised by our Strategy Board. In dealing with Strategy, let us first review a few of the ways in which Coupons and Sampling are employed strategically. An article itself, theoretically, ought to be its own best salesman. But most of us know that it isn't. Put five samples of oatmeal into five different homes. Ask each to decide which brand is liked best. You are likely to get from three to five different answers. But point out to each housewife what she will discover in some certain brand. Tell her how it reveals its advantages. Then she will discover them—always. Such is the power of suggestion. How many billions of samples have been distributed without any regard to this principle? By the use of psychology, we make ten samples win more trade than a hundred did in the old way. 47 We can actually prove t h a t We can make each dollar spent in sampling go ten times as far—on the ordinary line—as it did before we employed Strategy. 'I* *K *K Another thing to consider is that a sample means little until people have come to want it. We must arouse a desire for an article before that article has any value. What manufacturer, outside of our clients, yet understands this fact? W e know one store in Chicago which distributes a million manufacturers' samples in a single month each year. Not a single recipient has any choice in the matter. None knows what he is going to get. When some scores of manufacturers waste samples in that way, in this day, think how very little men yet understand of the principles of sampling. We established the principle of creating desire. No samples are given under our direction save to people who want that particular article, and who go to some trouble to get it. # * * Another fact is that articles given away are cheapened by the gift. This is particularly true when a full-size package is given. It is harder to get people to buy them afterwards than it was before. The article, before the sampling, comes to have a recognized value—its established price. Once give it free and you unsettle that value. Human nature finds it hard to pay for what once was free. 48 We know a food manufacturer who, by not knowing this fact, killed most of the trade he had. He advertised a day on which every grocer would give a full package free. He spent $75,000 in this way, in his best territory, before he discovered his error. And never to this day has he recovered his old position. These are fixed principles, based on human nature. The man who overlooks them pays, the penalty. Men have paid it, doubtless a thousand times. Yet, have you ever before seen one of these facts worked out and set down as a principle? * * * Accepting these principles, one of our problems has been to adapt sampling to them. We have done that in the past few years. We offer no sample until we create a considerable desire for the product. We offer it then only to those who are interested enough to go get it. Then we offer enough to make a decided impression. We offer no sample without suggesting in some way what people are going to discover. W e point out the taste, the results, the advantages. Then people don't fail to find them. Then we never make samples free. The consumer himself doesn't pay for them, but the maker does. The dealer who distributes them gets the full retail price. To give a product free conveys the impression of cheapness. The article isn't appreciated. But to buy that article at the asking price, so that an49 other may try it, conveys a very different impression. It evidences faith in the product. And it adds a new value when you buy it yourself. Thus came about our well-known coupon advertisements. Any ad with a coupon stating, "We will buy you a package/' has, up to this time, been a Lord & Thomas production. It will always remain our invention. *j* *P »K Never has sampling, in all the history of advertising, paid as we make it pay. We not only get users, but we get dealers. A sampling plan of ours secures complete distribution. And an article is put on a profitable basis at once if it can ever be put there at all. It doesn't take long to find out. But the plan must be rightly conducted—there lies the main secret. One must look out for the final impression. Temporary interest must be coined into permanent enthusiasm. One must also guard against fraud without giving offense. One must get full distribution at the smallest expense. And one must know, above all, how to cinch his advantage after going to the cost of attaining it. We have learned these things by very costly experience, so we cannot, in print, be too specific about them. Our object is to show what Strategy means, not to reveal the whole recipe. Now for some illustrations. W e cannot here give the names or the details, but we shall be glad, 50 if you wish, to discuss them in person, providing you are not one of our client's competitors. * * * A client of ours had a product of merit. He believed—and rightly—that the best way to convince folks was to give them the product to try. In a good many cities he arranged with some dealer to hand out the article—a full-size package —to all who applied on a certain day. Then he advertised the facts in the newspapers. This concern at that time was not a client of ours. But the advertiser had able advisers. He did not overlook the effect of suggestion. With every package went a book pointing out what the user should look for. But he made the mistake of giving that sample away. And that same package, if purchased later, cost the user 50 cents. Users would not pay it to get an article which had been given free. The result was a costly failure. It wiped out every dollar the concern had invested, and the established trade was not worth a picayune. One of our Strategists changed this offer to a buying proposition. The same package was given, and the consumer paid nothing. But the maker paid the dealer. The offer was not merely to give something free. It was to pay 50 cents to give one something to try. A commonplace offer was changed into a startling exhibition of confidence. The next fiscal year that concern's net profits ran into seven figures. An absolute failure was, 51 by this simple strategy, made a tremendous success. That taught us this principle, and we have applied it in a hundred ways since then. * * * One of our clients, in two-thirds of the country, had met with marked success., But a competitor of his owned the New York market, and there seemed to be no feasible way to dislodge him. Advertising without distribution would mean an enormous waste. And our client's best efforts had failed to secure more than 3 per cent distribution. Our Strategy Board was set at work on this problem. They first evolved a two weeks' campaign to create a desire for the article. It was aimed, in large part, to awake curiosity. And let us say, by the way, that we never have discovered an incentive for buying quite so strong as curiosity. Then we sent out to all dealers the complete series of ads. Topping them all was a page ad with a coupon. That coupon—to be published just two weeks later—entitled the holder at any store to a full-sized package for which the maker would pay. Lord & Thomas made the announcement to dealers. And dealers in most lines have come to know that our coupon plans are effective. The result in two weeks was a 97 per cent distribution. Every dealer saw that he would need to have the article. And the simple announcement of such an offer was inducement enough to buy. 52 In one day, in Greater New York alone, 1,433,000 people cut out that coupon. In three days they were all presented. Our client spent $143,000 and over to redeem those coupons from grocers. But every store in the city was supplied with his product. And 1,433,000 homes had come to want the article, and then had actually tried it. The next year our client sold more than onethird of his output in Greater New York alone. And nine months' profit was about sufficient to repay the whole cost of the effort. From the day of the coupon this brand has dominated in the New York market. It has controlled 70 per cent of the trade. * * * This was a big venture, and we have said that modern strategy involves but little risk. Let us explain, therefore, that this plan was tested in four smaller cities before it was tried in New York. We had established an average on cost and result which we knew would not vary greatly. We had proved that the plan was the cheapest possible way to get universal distribution, outside its effect on consumers. And we knew, almost to exactness, how quickly the cost would come back. In addition to this, we had the records in numerous other lines. And, while each line is different, previous records are helpful as a guide. This New York affair was a big undertaking, but it was not a big risk. The advertiser knew that he was operating a certainty, while most people believed that he was staking his solvency. 53 This is the simplest form of the coupon—its local newspaper use to cover just that locality. Again and again we have used it to bring certain sections, immediately, to a profit-paying basis. Yet there is many a line where it isn't advisable. One day an account came up to our Board where local advertising could not be afforded. Only class advertising could be made to pay. That meant the use of certain general mediums. And general mediums can't be used without national distribution. In studying this problem, a new idea dawned on a member of our Board. And he said, "Why can't we do in a national way what we have done so many times locally?" It seemed like an inspiration. But, as with all new ideas, we laid our plans to prove it out cautiously. We selected one typical medium with a large circulation. Then we prepared one advertisement to create a desire, and to end with the coupon offer. We worked out an announcement to the trade of the country. And we enclosed with it this coupon advertisement. W e stated the date on which this advertisement would go out to 1,500,000 homes. This simple announcement, before the ad came out, brought orders from more than six thousand new dealers. It sold directly over $100,000 worth of the product. The coupons came back from 3,600 towns, and from many times that many dealers—all of whom had to stock. In six weeks from the day this idea was conceived, this advertiser of a new product found him54 self with a national distribution. And the profit he made on immediate sales more than paid all the expense. Think of that. National distribution, national publicity—115,000 actual users—without spending a penny beyond the instant returns. Last year this advertiser paid a dividend of forty per cent on his capital stock. * * 5fc Then came a manufacturer who had two lines, both of which he wanted to market. One was pretty well known, the other wholly unknown. To meet this condition our Strategy Board evolved a new form of this offer: "You buy one thing, we'll buy the other." Each coupon then meant a sale of the old article —a sale at full price. And it meant the introduction of the new article, just to those who liked the old. Every dealer who handled the old article was thus compelled to stock the new. And thousands of new dealers were added. The business to which this plan was applied had been established for thirty-six years. In the next two years the whole business was doubled. Yet every effort which we supervised was more than paid for by the instant returns. The advertiser actually took no risk whatever. And not one cent was invested in advertising for longer than sixty days. 55 Each form of strategy was invented by us to fit some particular line. But, when once invented, we find endless applications. That is another advantage of a great organization. All the time, in some line, we are trying out something new. When it proves itself, we apply it to other lines. Thus one discovery, properly modified, may help a hundred clients. At this writing we are sending out a coupon, for the first time, into 11,000,000 homes at once. Note that—to over half of the homes in America. It compels the presenter to buy a well-known product, while the advertiser buys one which he wants to have known. Were each of these 11,000,000 coupons presented, the cost of redemption would be $1,100,000. But other clients of ours from their records have proved what percentage will be presented. It is evident now that the announcement of this offer will sell to dealers close to ten million packages before the coupon comes out. One result will be a good national distribution, accomplished within six weeks. An army of salesmen would work for years to do what is thus done at once. Some hundreds of thousands of homes will soon try this new product. And each will have paid the expense of the gift by purchasing another thing made by the same concern. Have you ever known anything more ideal in the way of quick introduction? 56 This sounds simple enough in the telling. But this much of the matter would never be told were such plans easy to operate. It has taken us years to perfect the methods which make these offers effective. And they remain, up to now, exclusively ours. So much for the coupon and its adaptations. We have employed it, perhaps, on a hundred accounts. But the instances cited will suggest the general idea. In no two instances are our methods alike. In these ways we have solved quick distribution, local and national. We have made it possible to place new products on a profit-paying basis at once. We have made a business, which in March was an infant, a monster by the end of June. And we have made campaigns, from the very start, pay their own expenses. If you have a business susceptible to this form of strategy we shall be glad to discuss it with you. 57 Strategy Applied to Human Nature S t r a t e g y Applied to Human Nature E CAN in this book only briefly suggest the most important uses of Strategy. So we are trying to pick out from its myriad phases those which bear the widest significance. We have shown how it is used to build big business quickly. Let us now show how we accomplish, by inexpensive maneuver, what used to be done by sheer force of attack. Let us suggest how we use it to save situations. Also how we employ it, when nothing else offers, to furnish a selling argument. Strategy has done, in some cases cited, what ten times the expenditure could not do without it. * * * Since time immemorial, the Guarantee has been widely employed in merchandising. We cannot claim origin for it. But, as with the Coupon, we do claim credit for most of its recent efficiency. The dealer's signed warrant, so far as we know, was the invention of one of our strategists. There is a very wide difference between written protection, signed by the man next door, and the printed guaranty of a far-away stranger. Yet, if both are fulfilled, one costs no more than the other. Just this little difference has changed failure to success quite a number of times in our recent expe61 rience. It was almost solely responsible for one advertising account which has run as high as $400,000 per year. * * * The word Guaranteed has been used so promiscuously that it has lost all its power of impression. Ordinarily it isn't worth the space it takes. Yet one of our clients—Holeproof Hosiery—by making the guaranty definite, has built up a business of 30,000 pairs daily. And that is a line where ordinary advertising has proved itself most difficult. The same basic idea has been rather widely applied in various forms of campaigning. It has always been immensely effective. In lines which offered no conspicuous advantage it has sometimes formed almost our whole selling argument. The problem lies in making it definite, making it impressive, and avoiding fraud. It has taken us years to do this. And we learned through a hundred mistakes. W e had to learn at the same time that some guarantees should never be advertised. An automobile is guaranteed for three months. Motor car tires for 3,500 miles. Bath room fixtures are guaranteed for two years—typewriters for one year. To mention such limited warrants in advertising is worse than no mention at all. * * * One of our clients makes an evaporated milk. This milk, in the process of sterilization, is given a slight scalded flavor. 62 At one time we found that this unnatural flavor killed a large percentage of the trade we created. Users failed to buy again. This problem, as usual, came up to our strategists. The natural solution would be to explain the flavor. But any explanation which we could devise sounded too much like apology. Then one man suggested, "Let us call it the Almond Flavor. Let us make it a virtue—an indication of purity—of freedom from germs. Let us tell the buyers to seek for this Almond Flavor—that the milk is not genuine without it." And we did. We changed the objection into an advantage. This advertiser now is selling close to fifty million cans per year. * 5{C 5j€ One of our clients suffered wide-spread substitution. In this line substitution was particularly easy. And there was quite an incentive, for numerous brands sold at half our client's prices. It seemed at one time as if this substitution would make profitable advertising impossible. This problem, like all of them, came up to our Board. The tyro in advertising would publish a warning—"Look out for substitution. Be sure of the genuine." And the warning would have been ineffective. It might, in fact, prove a boomerang. It sounds selfish. W e can't enlist the public in a scheme to corral trade. But one man suggested that we head an advertisement, "Try our rivals' too." Then go on like 63 this: "When someone says that his brand is as good, please buy it and try it. Serve it with ours. Let your folks make the comparison." That ad solved the problem. It bore not a semblance of selfish intent. It showed no fear of rivalry. It was unusual enough to be startling. It was fair enough to be convincing. It was splendid strategy. This advertiser remains today one of our largest and most prosperous clients. * * * When the low-priced automobile first came into prominence, men were loth to believe that a highgrade car could be sold for $1,500. We piloted in an advertising way one of the most successful concerns in this line. And the most successful stroke in that pioneer work was the stating of actual profit. It was useless to argue on specifications. All sounded alike to the average car buyer. Any mere claim to give most for the money would sound like others' claims. So our strategists picked out the nine per cent profit, and we made it the key-note of that famous campaign. Then we told the actual cost of the engine, the transmission, the axles, the frame. We stated that the ball bearings employed in the car cost $103 exactly. The costs which we quoted on hidden parts footed close to $700—on a $1,500 car. And we omitted entirely all that was visible—the body, upholstering, wheels, tires, etc. 64 That was good advertising, but it was also more. It was skillful strategy dealing with human nature. It was based on the principle that definite statements are accepted literally when the man or concern is responsible. But generalities are always discounted—sometimes by ninety per cent. Two years later, the advertiser in question declared one dividend of one thousand per cent. * * * One object of strategy, when it is possible, is to give to the prospect some apparent advantage. It is not in human nature to sacrifice an advantage. Another is to accomplish in some simple, cheap way what could never be accomplished by logic. A set of books, at one time, was made nine times as salable by the simple offer to put the buyer's name on each book. Another object of strategy is to get people to act —to get them to take some step toward the buying at the climax of our impression. The general inclination to put things off costs every advertiser many hard-won sales. These are only a few of the myriad things which a salesman-in-print must consider. * * * Strategy, as we say, is not exclusive with us. We often see some very clever examples which never occurred to any man on our staff. But Strategy is an element too valuable in advertising to be left to accident—to any chance inspiration. We have made it a science. 65 The original idea is often crude and impossible. We bring it before many men for discussion, and all the possibilities of the idea are developed. Then each idea, when once proved out, serves as the basis for endless adaptations. Thus each new problem gains all the benefit of all our previous solutions. And mistakes are never twice repeated. In this piled-up experience, in this vast reserve of ideas, lies the greatest advantage in this organization. 66 Business Strategy Business Strategy E H A V E now to confess that there is one advertising problem which we never have solved. That is the problem of advertising our business. The best men on our staff have fallen down in attempting it. Our Advisory Board calls it impossible. Again and again we say to ourselves, "If business men only knew." W e see golden opportunities going to waste. We see mistakes being made which we know are expensive. We see the crying need for what we have in abundance. But how can we let men know? Men may boast of their creations, but not of their powers. They may talk of their merchandise, but not their qualifications. Human nature resents any self-assumption of learning or of ability. And our whole business is to deal in these. But here are some facts of enormous importance. Let us endeavor to modestly make them apparent. % ^ 3|C In our business we come into intimate contact with hundreds of bright business minds. Most of our clients dominate their lines. They have made themselves leaders in particular industries. Our relations with these men are close. We must give their affairs careful, painstaking study. We must keep in touch with every move which in any way relates to the selling. Naturally we learn 69 all the various ways in which men grow successful. In hundreds of lines of commercial endeavor we are constantly acting as business advisers. For nearly every move, in one way or another, has something to do with the advertising. Fair business ability, broadened by close contact with so many great undertakings, ought to develop exceptional acumen. One may reasonably assume that it does. In addition to that, our office becomes a clearing house of ideas. We gather them from every direction, weigh them, compare them, sort them and file them. Thus we have accumulated, in the course of years, a storehouse of information. Most of our older clients, in analyzing their progress, will invariably conclude that our business advice is the most valuable service we render. At least twenty will say that some one piece of advice has proved itself worth more than all our commissions. And we entirely agree with them. The road to success has a myriad forks. And the man who once turns in the wrong direction must either go back or fail. Men who have traveled the road as often as we, and with as many as we, often prove exceedingly helpful. 5JC 5j? 5jC Most of the problems which confront business men have been solved by some men somewhere. Most of the pitfalls to be avoided have been discovered in other careers. There is hardly a business course ever contemplated of which some of our 70 clients don't know where it leads. And we have the information. The question, for instance, of giving exclusive agencies. We have seen them employed to the seller's advantage. And we know all the ways in which they were made profitable. Again we have seen where exclusive agencies cost the man millions in the long run. They have opened the way to immense competition, invited by this one mistake. Think what it means to know all sides of this question before mapping out one's own course. The problem of free goods is another example. Is it wise to use them to get quantity orders ? How can such offers be terminated without any friction when the trade comes to consider them as vested rights? Is this a good temporary weapon against competition? If so, how can I use it and avoid the reaction? If my competitors use it, how can I best reply? Clients of ours have solved all of these problems, and we know to exactness which solution was best. Some have worked out methods more effective than free goods, and which do not cost nearly so much. We can explain the ways to you, with their permission, if you are not a competitor. W e have saved to our clients literally millions of dollars in schemes for avoiding concessions. And the plans when we brought them had been all tested out. 71 Another frequent problem is the financing of advertising. Many of our most successful lines started with very small capital—sometimes insignificant sums. There are others who want to know how. And even the most opulent are glad to learn ways in which advertising can finance itself. How have men solved this by advance orders from dealers ? How have they solved it by agency contracts? How have they obtained direct orders by mail until the demand compelled dealers to stock? What were the results of each method? Quite a number of clients owe their existence as advertisers to the proper solution of these early problems. 5}? 5JC >{? How is one advertised line made to carry the unadvertised? On that question alone hangs a fortune sometimes. Men poorly advised have often gone far before they even considered it. And they have proceeded on lines which made after-consideration impossible. W e have in mind one conspicuous example, where we helped a competitor become tremendously formidable by avoiding a similar error. Side lines, again and again, are now made to pay the whole cost of publicity, so the main line profit is velvet. Think how much it may mean, at the start of a campaign, to prepare for this possibility. A food manufacturer called us in to advertise a certain product. W e at once discovered another product which, by changing the name, could be advertised with it—both in a single campaign. 72 The original product has been very successful. But the auxiliary product last }^ear sold equally well—almost case for case. This year, the profit on the auxiliary product will run about $400,000. Judge how great was the value of the experience which suggested that combination. * * * The problem of price is immensely important. We have seen shrewd men kill the trade they had by cutting the price to increase it. In one of these cases we were called in to rectify the condition. We told the concern many counter experiences, which show how Americans judge things by the price. They altered the prices which were proving unprofitable. And they put part of the addition into effective publicity. We say "part of the addition/' All the cost of the advertising, from the very start, was paid from the added margin. Quite a number of our clients owe their successes to the prestige of high price. They have featured it—boasted it—compelled notice by it. It is worth a great deal to know where this can be done, and where the same idea would prove fatal. * * * In the summer of 1910, an automobile client asked us to visit his factory to prepare an announcement of his 1911 designs. We found them mostly open-front bodies. It is our business to know automobile conditions as well as anyone can. Conditions in this line are 73 constantly changing. To serve our clients we must keep in touch with every pulse and prospect. We knew that 97 per cent of all foreign models were then being shown with fore doors. And we felt utterly certain that 1911 would be a fore-door year in America. We advised the manufacturer to abandon his open-front models—to make up a new line and fit all with fore doors. He took our advice, though it delayed him a month. When the season came on there was a dearth of fore doors. Open-front models proved almost unsalable. Old manufacturers had made mistakes in their bodies, and they found that the cars they had stored for spring were considered out of date. The man who took our advice reaped a tremendous harvest. His sales for the season ran 15,000 cars. In addition to this, he has gained a prestige the value of which is immeasurable. This manufacturer has said that our one piece of advice was worth a million dollars. He is far too low. * * * Automobile tire makers devised a new feature. They called it the "straight-side tire." The object of the feature is to make a tire that can't rim-cut. The feature was hard to explain. It has been used for six years, yet not one motorist in fifty knows what "straight-side" means. It is not a result but a means to a result. The object is the prevention of rim-cutting. 74 W e were called on to advertise one of these tires, and our strategy men saw the trouble at once. So they coined the name No-Rim-Cut tire. Thus they announced the result in an understandable way, and left those who wished to analyze the cause. This campaign started just four months ago. Today the maker of these tires is turning out 2,200 per day. He is running his factory night and day, with three shifts of men. Yet he has not for weeks been less than $2,000,000 behind on urgent orders. Of course the tire was right. Good advice would be worthless were that not so. But our suggestion made its virtues clear. And the result has been a sensation. Each business has its separate problems. Perhaps no instance we have mentioned applies in any way to you. But consider the hundreds of lines, with their thousands of problems, which we deal with all the time. Is it not likely that we have learned some solutions which you would give a great deal to know? 75 Telling Men H o w To Make Money T e l l i n g Men H o w To Make Money N T H I S year of our Lord, Advertising is a word of very wide application, almost infinite in scope. An advertising adviser, to deserve his place, must be more than most men suppose. He must be more than he dares to claim. The visible part—the printed word—is but one of the means to an end. Like the khaki-clad men in the battle ranks, words merely fire the shots. Before a shot is fired, the wisdom and purpose of the whole campaign must be weighed by men who don't make mistakes. These men must have wide information, accurate knowledge. They must be immensely experienced. They should be veterans with laurels won in countless wars for trade. They must know business, as it pertains to selling, from the Alpha to the Omega. They must not depend, as men used to do, on the crude force of attack. Force is too expensive. And it is futile when capable strategy is brought into play to combat it. Modern trade battles, when properly generated, are mainly won through inexpensive maneuvers. The science of Advertising, as practiced today, involves about all that pertains to the science of 79 business. And the men in charge must be pretty big men to be worthy of the trust. Our business is practically to tell men how to make money. To bring them wider experience, more efficient methods, more economical plans. And to guard them against mistakes. And there lies our pride and incentive. * * * Let us suggest how involved are some of the problems which come up to us to solve. They may indicate somewhat the range of ability required in this line today. They may point out the advantage —perhaps the necessity—of experience, information and calibre. In many lines, manufacturers and producers are combining in associations to promote their general good. But some such associations have existed for years without making any great progress. They meet for discussion, but reach no conclusions. No man among them is experienced enough to tell them just how to proceed. It is expected of us that we go to those men and be able to point out definite plans of procedure. We must bring them examples of what others have done, and outlines of how the)^ have done it. From actual chaos, we must help them evolve a definite plan for action. And it must be so feasible, so appealing—so clearly the right and profitable way—that a thousand men will agree to it. And then, we must make our representations come true. For it would be pretty nearly fatal for so us to make a fiasco before the watchful eyes of a whole allied industry. For instance, one problem was to market fruit at a profit—a fruit produced by many growers. It involved labeling a fruit which had never before been labeled. It compelled an adequate insurance of quality. It involved creating an over-demand, so that quality of fruit could command its fair price. We did it successfully. The allied growers today are in an envied position. But can you imagine how many procedures that plan of campaign involved? In another case four thousand manufacturers were fighting each other by cut-throat competition. The profits at best were meagre. Some years there were none at all. The goods they made were staple, but certain factors, as they knew, limited consumption. There was nearly always in this line slight overproduction. So there generally existed what is called a buyers' market—a market where buyers could dictate the price. A slight increase in consumption, as we pointed out, would create a sellers' market. Just that little margin, could we wipe it out, would add millions per year to their profits. And we were able to show them how a small part of those profits would serve to create this condition. Our efforts in this matter have already served to change the whole aspect of this immense industry. 81 Another problem in modern advertising is moulding of public opinion. It may be for the purpose of securing a franchise. It may be to win an election. Or its purpose may be to renew the good-will of an enterprise which has been attacked. One can imagine, without discussion, what problems like that involve. It is part of our business to solve them—and to win. Another common problem—arising especially in our immense railroad advertising—is the populating of certain communities. Think what it means to attempt, on a large scale, to turn tides of emigration. We are constantly called on to do it. * * * Then there are many lines where the visible profits seem insufficient to warrant advertising. And yet a way must be found to secure that degree of monopoly which can be attained, in a legal way, only through effective publicity. We must be able to show, in lines like these, the value of volume profits. It is possible in many lines to increase the business one-third, with little addition to overhead expense. That added third sometimes will pay five times the average profit. Volume profit pays for a great deal of advertising which could never be done without it. W e must be able to show this fact, and to apply it. And that involves, as is evident, a considerable knowledge of merchandising—a better knowledge than the average manufacturer, in his limited field, can acquire. 82 Such are samples of the problems which arise in advertising. It is for you to consider how valuable to you may be the men who can solve them. Half-way help in advertising may be worse than no help. Inexperienced help may cause you to pay for experience. The most important element in advertising is the capacity of the men in charge. Yet the utmost capacity, because of organization, can now be secured at very small expense, 83 Some Details Some Details E E M P L O Y no men who are simply solicitors. The men who call on advertisers are Plan Men, and members of our Advisory Board. They are all trained men, all masters of advertising. All keep in touch with all our undertakings. They are reasonably familiar with every detail of every important campaign. All the information we gain, all the ideas we develop, are known to them through our system of conference. And all of them bring us new suggestions from everywhere. These Plan Men devote most of their time to caring for existing accounts. They visit the advertiser, advise with his aides, map out selling plans, follow-up systems, etc. They present to the advertiser all the information we gather which can be of aid to him. And they bring back to our Board any new problems which ought to be dealt with in conference. It is thus that each client, so far as he can use it, gets the benefit of all we accomplish. A Plan Man will sometimes spend days with an advertiser in working out a new situation. * * * Our charge for service is the usual agent's commission—a percentage on the amount of expenditure. The commissions and discounts which we 87 get from publishers are given in full to the advertiser. Our agent's commission varies somewhat with different classes of service. But the amount of expenditure has nothing to do with it. The small beginner pays just the same rate as the developed advertiser who spends a half million yearly. Lord & Thomas service costs no more than the usual charge for competent service. And fourfifths of the charge goes to pay for that service. Our own net profit averages but three per cent. * * * We are glad to meet advertisers, present or prospective, wherever they find convenient. And we go to any length necessary to help them decide as to wisdom of advertising, or the worth of our service. A call for a conference involves no obligation. 88