by Freddy J. Nager, Founder of Atomic Tango LLC + Guy Who Likes Shiny Objects
A lot of people ask me whether marketing actually works. Sure, they say, anyone can claim that marketing made Nike and Apple and BMW rich and popular — but how do we know that these companies didn’t become rich and popular simply because they have great products?
In response, I first explain what marketing actually means. It’s not just advertising and sales; indeed, creating “great products” is a large part of the equation.
But when you’re trying to convince people of something, arguing theories and definitions is far less effective than providing proof — as the cliché goes, show, don’t tell. So I point out these three examples of marketing creating massive demand for products that otherwise have little value:
- Bottled water. Yes, water is essential, but overpriced water that’s no better than tapwater yet transported across the globe in petroleum-based plastic bottles, well, not so much.
- George W. Bush.
Yes, diamonds. I previously wrote about Australian marketers turning worthless brown industrial diamonds into highly coveted “champagne diamonds.” Then a couple of days ago, two things happened that made me want to write about diamonds again…
1. I finally received my settlement in the 2008 class action suit against De Beers, the company that cornered the global diamond industry and used its monopoly power to jack up prices worldwide. I had to submit a receipt for some jewelry I bought, and five years later I received a check for… $46.39! Woohoo! I can now afford to fill my car with gas. (BTW, I’m not the only one riffing on their settlement – The Consumerist has this amusing report on the great American diamond settlement.)
2. Business Insider published a great history of diamond valuation by Rohin Dahr, which included these priceless nuggets:
- “… diamonds aren’t actually that rare. Only by carefully restricting the supply has De Beers kept the price of a diamond high.”
- “As soon as you leave the jeweler with a diamond, it loses over 50% of its value.”
- “Until the mid 20th century, diamond engagement rings were a small and dying industry in America.”
- “Many smart and prosperous women didn’t want diamond engagement rings.”
As Dahr explains, De Beers hired adman Gerald M. Lauck of the agency N.W. Ayer to create value and demand where there was very little. In 1938, Lauck launched a brilliant integrated marketing campaign (back then, it was all just considered advertising) that even exploited the British Royal Family to hype diamonds. Did it work?
You know the answer.
Despite the fact that the country was in a Depression, diamond sales surged 55%. (And as Dahr’s article points out, not because diamonds are a good investment – they’re actually quite the opposite.)
Since then, diamonds have become a fixture of American culture, from Marilyn Monroe singing “Diamonds are a Girl’s Best Friend” to James Bond saving the world and seducing the ladies beneath the slogan “Diamonds are Forever.” American men believe they’re supposed to spend two-months’ salary on an engagement ring (a complete De Beers fabrication). And while you might not recognize the name of the classical music piece “Palladio” by Karl Jenkins, you can likely identify it as the theme of De Beers’ admittedly fantastic commercials:
The Many Facets of Human Desire
Now I’m not knocking shiny rocks — no more than I would knock other high-priced purchases that deliver absolutely no value other than sensory pleasure and status. That could be a $400 bottle of Dom Perignon, a Rolls Royce, an original Picasso, a rare comic book, an LV purse, courtside tickets at a Lakers game, or a first-class trip to Tahiti.
The market offers lot of shiny pretty objects that make us covet and crave, and spend hard-earned bucks just to look at them, taste them, hear them, smell them, and show the world that we own them. The basic desire for objects that delight us goes far back before De Beers and advertising and even humanity. Animals of many species also prize shiny objects.
I just admire the skill of modern marketers who can turn the ordinary into the extraordinary, almost overnight. And the “Diamonds Are Forever” campaign by N.W. Ayer is a classic.
Now it’s sad when people who can’t afford such products feel pressured to pursue them. And it’s completely detestable that some of these products lead to human and environmental destruction. So it’s important to have critical insights like the kind provided by Rohin Dahr. Lots of products come with a price that isn’t reflected in what we pay.
Just note that diamonds aren’t alone in this department.
Plus, There’s Always An Alternative…
If you can’t afford diamonds, or you find them reprehensible, the market offers many alternatives that might be just as good or even better in their own way. I once drove by a flower shop in L.A. that had the following sign out front:
“Diamonds are forever…
So buy her something that dies.”
I wasn’t dating anyone at the time, but I loved that slogan so much I stopped and bought some flowers anyway.
Now that’s marketing.