On the Campaign Couch ... with JB
By Jeremy Bullmore, campaignlive.co.uk, Friday, 19 February 2010 12:00AM
Q: David Felden of Hemel Hempstead writes: I've just read a copy of your magazine in the waiting room of my dentist.
If companies didn't advertise with these huge sums of money, they could lower the price of their goods, couldn't they?
A: I can't tell you how delighted I was to get your question. I've been waiting for years for an excuse to remind everybody about the American optometrists. It's one of the best stories ever about the advertising business and should never be forgotten. You may not be as enraptured with it as I am, but too bad: you did ask.
Thirty years ago, the Federal Trade Commission in Washington DC was alerted to an interesting fact. In half the states in the United States, opticians were permitted to advertise - and in the other half, they weren't. It was a researcher's dream - and the FTC duly commissioned some serious research.
Here are two of their key findings.- In those states where opticians were permitted to advertise - and did - the range of spectacles available was wider and consumer satisfaction was higher than in those states where opticians were not allowed to advertise.- In those states where opticians were permitted to advertise - and did - consumer prices for the identical spectacles were between 30 per cent and 40 per cent lower than in those states where opticians were not allowed to advertise.
In the UK at that time, all the professions imposed severe advertising restrictions on their members; a practice they defended, with straight faces, as being in the public interest. Here is a hilarious extract from evidence to the Monopoly and Mergers Commission presented by the Four Societies of the Land: "The professions as a whole ... have believed that, in general, freedom to tout members of the public to give them instructions for professional work would often result in members of the public, especially the less well informed, being prevailed upon to give their instructions to those who would serve them less well and less disinterestedly than those who are modest about their personal attainments and who do not push themselves forward to offer their service."
Please read that extract carefully again - and hug yourself with delight.
Happily, the MMC took rather more notice of the American opticians than they did of the British professions.
They concluded: "Of particular interest was the evidence that, where restrictions were removed or relaxed, advertising led to lower prices to the consumer while maintaining quality standards."
Yet how could this be? If the professions were now to be obliged to incur new promotional costs, how could they also afford to lower their prices? Everybody knows that in the end it's the consumer who pays for advertising: stands to reason, dunnit?
The MMC again had the answer. They found that restrictions on advertising: "(a) deprived the public of helpful information; and (b) reduced the stimulus to efficiency, cost saving, innovation, new entry to professions, and competition within the professions."
In 1983, the Office of Fair Trading published a report called Opticians and Competition.
Its principle conclusion: 'Advertising restrictions result in prices being significantly higher and efficiency significantly lower than they otherwise would be."
As the great Dave Flower so immortally said: "Advertising's worth doing when you've done something worth advertising."
The opportunity to advertise serves as a permanent incentive to companies to come up with things worth advertising. If you aren't allowed to shout about it, why be bothered to think of it in the first place?
Thanks again for your question, David. You're a lot better off buying your specs in Hemel Hempstead today than you would have been in 1980.
Q: This isn't meant to sound like a "my wife doesn't understand me" complaint but I feel as though my agency isn't listening to me properly. And it does tempt me to look for satisfaction elsewhere. Every creative they suggest just misses the mark - and I'm running out of patience. How long should I stick with this situation? Or is it me, not them?
A: The reason all those creatives are missing the mark is because nobody's helped them understand where the mark is. All those fizzing arrows but no agreed bullseye; scattergun stuff. What a waste of time and talent. Doesn't your agency have a proper planner? If they have, spend a day with her. If not, promote yourself to an agency that's got one.
"Ask Jeremy", a collection of Jeremy Bullmore's Campaign columns, is available from Haymarket, priced £10. Telephone (020) 8267 4919
Jeremy Bullmore welcomes questions via email@example.com or Campaign, 174 Hammersmith Rd, London W6 7JP
This article was first published on campaignlive.co.uk
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