The Law of Supply and Demand in Marketing
Issue #2127
- WEALTHY: Got an "iPod widget" idea? (Jason Holland)
- HEALTHY: How to make every meal do more than provide your body with fuel (Michael Masterson)
- WISE: David Ogilvy on the selling power of jingles
ALSO IN THIS ISSUE:
- Wide shoes, algae, and 10-cent tummy tucks (Bob Bly)
- One is the loneliest number (Suzanne Richardson)
- It’s Good to Know… about bosses
- Add "malleable" to your vocabulary
Revealed: Probably the Biggest Red Herring in History!
While the world’s been stock watching (and losing!), the elite quietly play a different game with different rules…
Feeling cheated and disillusioned by the stock market? Sure, you may have made a good trade here… but then lost on another. The people dutifully pour their hard-earned cash into investment banks to put into the stock market for them… and those investment banks gladly oblige, for a fat fee… which they invest somewhere else! I’m no conspiracy theorist, but in my opinion the stock market is really a diversion for the masses… a distraction from where the BIG and consistent money is made… in the world’s money mountain. And when I say “Money Mountain,” I speak quite literally… the BIGGEST mountain of money on the planet. Click here to read more…
Becoming a Chicken Entrepreneur: The Low-Risk Way to Start a Business
Becoming what Michael Masterson calls a "chicken entrepreneur" is a great way to keep your job (and a steady paycheck) while finding out if people will buy the product or service you are thinking about selling.
Minimal investment, minimal risk. If you don’t find your market, you try something else.
If your new side business is working, at some point it will start bringing in more money than your regular salary. That’s when you have a decision to make: Are you going to be an entrepreneur and work for yourself? Or are you going to be an "intrapreneur" - an entrepreneur who works within a company.
Morgan Strauss chose to go the intrapreneur route.
As an employee of a technology company, Morgan has started several businesses within the business - marketing and selling products he’s created. Though he still receives a steady paycheck and regular pay raises, he also owns a piece of any business he creates.
For example, he’s developed a series of iPod widgets - functional accessories that are also a lot of fun to use.
His KolorWheel widget allows you to scroll through 384 scientifically formulated color schemes - providing umpteen pleasing color combinations in moments. KolorCapture, a new application similar to KolorWheel, can be loaded on Windows Mobile phones. His TipKalc widget will split a bill up to five ways, with or without a 15 or 20 percent tip. And KolorDance allows you to be the choreographer of an iPod commercial-style music video.
Morgan sells about 100 of these widgets (at $9.99 apiece) each day on his website. (For a free demo of KolorWheel, TipKalc, and KolorDance, go to www.Koloroo.com and click on the links.)
Whether you choose to be a chicken entrepreneur or an intrapreneur, Michael Masterson’s advice to you is the same:
- * Start a business you know something about. Know it inside out.
- * Listen to the market. You don’t have to sell something new and exciting. Start with a better or cheaper version of a product already in demand.
- * Make the first sale before almost anything else. Eighty percent of your time and resources should be devoted to this task.
- * Understand the back end, selling higher-margin products to existing customers.
[Ed. Note: Get Michael Masterson’s insights into becoming successful in your business and personal life, achieving financial independence, and accomplishing all your goals on his brand-new website. You’ll find updates on all of Michael’s books, news on upcoming ETR events, Michael’s blog, and room to send in your comments and questions. Check it out today.]
"The advertisers who believe in the selling power of jingles have never had to sell anything."
David Ogilvy
The Law of Supply and Demand in Marketing
Modern economics is based, in part, on the law of supply and demand. If an item is rare and people want it, they’ll pay through the nose, driving the price higher. On the other hand, a large supply of a product, coupled with dwindling demand, can cause the price to plummet.
Well, marketing too has a law of supply and demand. It goes something like this…
When a product is difficult for the consumer to find, your advertising copy can be short, to the point, and straightforward - with little or no embellishment necessary. An example is the classic ad for Hitchcock Shoes, a mail-order company that specializes in shoes for men with wide feet.
The headline of their small black-and-white space ad, unchanged for decades, reads:
MEN’S WIDE SHOES
EEE-EEEEEE, SIZES 5-15
The visual is a picture of a shoe against a white background.
Now, this would probably get a failing mark from most copywriting experts. But Hitchcock Shoes has been running this ad virtually unchanged for as long as I can remember. It works because of the lack of availability of shoes for large feet.
There are plenty of shoe stores. But it’s extremely difficult for a man with wide feet to find his size. So when he sees Hitchcock’s ad, the headline immediately tells him - in a direct, straightforward fashion - that they have what he needs. Since he can’t get shoes anywhere else, the ad doesn’t have to be creative… or even enumerate the benefits of the product. It merely has to call the reader’s attention to what is being offered.
For a product that is difficult to find - like EEEEE shoes - a simple ad like Hitchcock’s can work like gangbusters. On the other hand, when you have a lot of competition in your category, then your advertising must be powerful and persuasive. It must extol the benefits of the product… show how the product solves the prospect’s problem… and how owning it can make his life better.
The ad must also say these things in a fresh, compelling way. Why? Because everyone else in the same category is making similar claims - and saying them in pretty much the same way.
Consumer health information, for instance, is a highly competitive category - filled with newsletters, books, magazines, and websites.
In a promotion for the health newsletter "Bottom Line Natural Healing," the headline focuses on weight loss. But the copywriter wisely avoids saying something like "Lose 10 pounds in 5 weeks." Such a headline has a clear benefit, and probably worked 10 or 20 years ago. But today, the consumer has seen it so many times, it has no impact. So he has to say the same thing - "We can help you lose weight" - in a fresh and compelling way.
He does it admirably with this headline:
10-CENT TUMMY TUCK puts plastic surgeons out of work!
Okay, so where does that leave us?
Well, in addition to the law of supply and demand in marketing - which says that the greater the product availability, the stronger the advertising must be - there’s another factor that determines the degree of creativity, or lack thereof, needed in your copy: whether the product is a luxury or a necessity. Or, to put it another way, whether the customer NEEDS what you are selling vs. whether he WANTS it.
You don’t have to have clever, A-level copy to sell dialysis treatment to a patient with kidney failure, because he needs the dialysis and will die without it. On the other hand, people may want better health and a longer life - and buy nutritional supplements to gain these benefits - but few of us really NEED nutritional supplements. A heart patient may need a pacemaker, but taking folic acid is probably optional.
This is the reason why so many long-copy nutritional supplement promotions you see are such powerful marketing pieces: You need to pull out all the stops to get the consumer - who has a clear choice of whether to take your pill or not - to buy. An example is a recent promotion for Sun Chlorella, a nutritional supplement made from algae. The headline of the mailing reads:
TOXIC KILLERS IN YOUR GROCERY CART
Can these fruits, vegetables, and even bagged salad be the cause of your worst health problems? 100,000 scientific tests say YES!
You have to grab the reader by the lapels with your headline because, while the consumer wants good health, he isn’t sitting there thinking, "I need algae." Putting the word "algae" right up front in your headline would likely get him to toss your mailing in the trash. But… if a change in the Earth’s environment suddenly meant you would die without consuming a sufficient amount of algae daily… and if Sun Chlorella was the world’s only source of algae… in that case, you could send out a postcard that simply said "Algae tablets available!" and generate more orders than you could ever hope to handle.
To sum up, two factors determine how creative - or direct - your copy needs to be:
1. Product availability
2. Need vs. want
When a product is an absolute necessity and scarce, then straightforward, clear, direct advertising messages work best.
When a product is a luxury and the category is cluttered with competing brands, you need a kick-butt marketing campaign to sell your prospect on why he should try it.
[Ed. Note: Master copywriter and best-selling author Bob Bly is the editor of ETR’s ETR’s Direct Marketing Masters Edition. a program to help you start your own successful direct-mail business. Sign up for Bob’s free monthly e-zine, The Direct Response Letter, and get more than $100 in free bonuses.
Correction: Bob Bly’s article, originally published on 8/22, referred incorrectly to an ad for extra wide shoes. The ad was for Hitchcock Shoes not Hancock Shoes.]
What If You Could Pile Up Profits Without Busting Your Hump?
Suppose you could live your DREAM life… have plenty of time to indulge yourself, play golf, dine out, hang with the family, have fun… and get steadily richer in about 10 minutes a month?
These investors are living the DREAM. Because I showed them this incredible secret myself. Now it’s your turn. Check it out here.
Eating Well - ETR Style
Eating well goes beyond the healthy high-fat, low-carb diet we regularly recommend in ETR. It means making every meal special - and that doesn’t take as much effort as you might imagine. You don’t have to spend a lot of money either.
Here’s how to do it:
- Select good-quality foods that are good for you - and avoid foods that are bad for you. Foods that are bad for you are those that, although they may taste good, make you sick or give you stomach problems or make you tired. Many people are negatively sensitive to dairy and wheat products, yet either don’t know that they are or don’t care. There are so many good things to eat. Why make yourself miserable for a cheap, temporary thrill?
- Plan your meals. You don’t have to spend hours with recipe books, but if you take a few minutes each morning thinking about what you will eat, you may find that (a) your pleasure will increase due to the joy of anticipation, (b) your selection of food will improve because of the little extra thought you’ve invested, and (c) your midsection may thin a bit, because planned meals, studies say, are healthier ones.
- Practice moderation. You can have too much of a good thing. Anyone who’s a fan of Entenmann’s chocolate doughnuts knows that. The trick to eating good meals is, in part, to eat no more than the optimum amount of any one thing. This applies to all foods, but it is especially true of the foods you like.
- Go slowly. You can’t taste food when you wolf it down. I know. I’ve wolfed down at least a thousand good meals.
- Stay focused. I don’t believe in multitasking. And this applies to eating too. Yes, it’s quite possible to eat and read or work at the same time - but if you do so you won’t enjoy your meal as much as you can. My recommendation is to eat good food slowly and in good company. Make each bite count. Enjoy the experience.
- 6. Mentally prepare to enjoy your meals. In fact, this may be the most important thing you can do to make every meal a good one.
[Ed. Note: An investment in your health is the single most important investment you can make. And it can be surprisingly easy. Sign up for ETR’s brand-new natural health e-letter to get specific, expert insights into how to achieve peak performance for your body, mind, and soul.]
You Don’t Need to Go It Alone
You can take great pride in tackling a new business project and completing it successfully, all by yourself. But most new projects have lots of hidden obstacles that you can trip over along the way. So take Michael Masterson’s advice and find a mentor to show you the ropes and help you accomplish a business goal much quicker and with far fewer mistakes.
Consider a survey published by My Success Gateway, LLC (a website offering advice to small-businesspeople and entrepreneurs) in which 17 percent of respondents said that they are finding success easy. All 17 percent have mentors. Meanwhile, 66 percent of the respondents - none of whom have a mentor - are finding it difficult to achieve success. And in another study, conducted by Simmons School of Management, women who had informal mentors reported a higher promotion rate than women who didn’t have a mentor.
"The best way to find your mentor," says Michael, "is to look around your industry for five successful business leaders who have retired within the past two to five years. (That’s when most ex-execs are pretty much bored with golf and missing the business world.)
"Write each of these five people a short letter expressing genuine admiration for their careers. Compliment them on specific achievements. Then ask for advice on your own career.
"Offer an invitation to go to lunch. Or, if they’re out of your local area, ask for a 15-minute phone call. Odds are, at least one of the five will respond positively to your invitation and give you a little of his time. If you find that you get along, you’ve got yourself a mentor."
Mentor in tow, you’ll be able to accelerate your learning process and get your new venture off the ground in no time.
[Ed. Note: At ETR’s upcoming Info Marketing Bootcamp, Making a Fast Fortune on the "Other Side" of the Internet, we’ll have a team of experts on hand ready to be your business-building mentors. You’ll learn dozens of proven techniques for shooting your online sales through the roof, creating new sources of revenue, and tripling or quadrupling your profits within the next 9 to 12 months. Sign up now.]
It’s Good to Know: About Bosses
Four out of 10 executives rate their bosses as "above average" or "excellent," according to a survey of 2,029 executives by Korn/Ferry International. By contrast, only 25 percent of those surveyed rated their bosses "below average" or "poor."
Turn the Tables on Microsoft, AOL, & Time Warner!
Oh no! Yet another mandatory upgrade from Microsoft. On top of that, they say you probably need a new computer too. Then there’s your Internet provider hiking rates and fees again. Meanwhile, more time flushed down the drain surfing the web for endless hours.
There’s got to be a better way.
Shhhh… There is…
Let me take you on a trip to T.O.S.O.T.I.
- Patrick Coffey
Word to the Wise: Malleable
Something that’s "malleable" (MAL-ee-uh-bul) - from the Latin for "hammer" - is (1) easily influenced or (2) adaptable.
Example (as used by Juan Gonzalez in Harvest of Empire: A History of Latinos in the United States): "The natives proved less malleable and far less innocent than the Europeans imagined, so much so that early colonial history is filled with countless stories of monks who met hideous deaths at the hands of their flocks."
[Ed. Note: Become a more persuasive writer and speaker … build your self-confidence and intellect … increase your attractiveness to others … just by spending 10 VERY enjoyable minutes a day with ETR’s new Words to the Wise CD Library.]
Michael Masterson
Copyright ETR, LLC, 2007