If Jobs was a MD at Artek, he would make everyone admire how Artek rolls in contribution margins that are quadruple the amount of Ikea’s. Reporters would rant on about it and praise Artek’s success. They would also completely forget that if Ikea wanted to, it could buy Artek with it’s a single day’s sales profits.

Apple is like a popular but slick politician, who has turned sweet empty promises into a competitive advantage. Steve Jobs makes claims, media repeats them. All this makes Apple look like a creative visionary and Nokia like a gray bureaucrat.

But why Nokia agrees to be the grey bureaucrat?

Nokia is the largest mobile phone manufacturer in the world. A million Nokia phones are sold every day. That equals 10 000 000 euros of profit each day. Nokia has KASSA of ten billion. It’s best phones and their features compete with iPhone.

Nokia’s logistics are effective and its production costs are low. In case Nokia decided to take down Apple, it could sell its smartphones with no contribution margin at all for years and set the market price for the segment. Apple would be in distress.

In February, the world held its breath as it waited Stephen Elop to tell his great big news and restore Nokia’s halo. And as we now know, the big news was that Nokia allied with Microsoft and takes on Microsoft’s Windows Phone operating system. Symbian phones are still sold for now and Meego system will not be entirely deserted.

Perhaps Elop’s decision was wise from the viewpoint of engineering sciences, who knows. But media condemned it not to be. Even economical analysts scorned upon Elop’s decision. They saw Nokia and Microsoft to resemble to two middle-aged who find each other at the end of a bar night as all the young pretty ones have already gone off. Nokia’s stock dove 14 % immediately and has continued to do so for over a month.

If Nokia wanted to create a hype, it could….

Nokia could give people the stars from up above, if it decided to concentrate on creating hype and making impressions. Nokia could set up an innovation group with annually changing members from the cream of global artists and musicians. Perhaps Steven Spielberg could lead the very first team. The team could create its own product line, Illusion, and leave the old smartphone category to rot. The product would be launch inside a glass bubble at the bottom of a sea, with colourful turtles and fish swimming around it. Spielberg would make everyone believe that something really important is about to happen, and reporters would believe every word.

...but maybe Nokia has an even more cunning strategy

A few facts:

• Most phone owners do not know what operating system his phone has
• Most phone owners cannot say what features are caused by the operating system and what by the phone itself
• Most phone owners use only a fraction of the hundreds of features of a smartphone
• Nokia sells more phones with S30 or S40 operating systems, not those with Symbian or Meego

Maybe Nokia is a far more cunning player than everyone thinks. By letting its competitors compete fiercely in the smartphone category, Nokia could intentionally be keeping the limelight away from the cheaper categories – aka those with S30 and S40. Nokia is controlling a segment much larger than smartphones. We’ll let you fight elsewhere; we’ll take India and China.

Hundreds of people were sitting at a marketing seminar, and the lecturer asked what kind of marketing goals you could and should have. No one answered. A little later on, he asked the same thing with the words ‘What is the purpose on marketing?’. A few shy voices exclaimed: ‘to create mental images’, ‘to sell’ and ‘to create demand’. 

That is astonishing. And all of those people in there were marketing professionals, a.k.a. those people in Finland who spend a thousand million euros per year to marketing. And only a fraction of them ventured into guessing what is the purpose of marketing.

But what is the purpose of marketing?

Perhaps we should think about it as follows: the purpose of marketing is to change the race all together – to make the market situation change in a way that the status and the competitive advantage of the marketer are improved.

I’m sure that this is the way how Ingvar Kamprad, Luciano Benetton or Louis-Vuitton-Moët-Hennessyn Bernard Arnault see it. No one spends their money without them knowing exactly how that money will make a change or how it will quadruple itself in sales returns. 

When you google ads by Ikea, Benetton or Vuitton, you’ll see their timeline and realize that their goal has more often been more on shocking the markets than on mere sales. 

But all advertisers are not Ikeas and Vuittons. 

Malls, for example, spend big budgets on advertising but their retailer associations cannot agree on anything that would actually change the race and create competitive advantage. Their fall campaigns are always School’s here! and January sales are called Hulabaloo!.

Political parties and all sorts of special-interest groups also have faith in marketing. Their ads tend to have a picture of a kid or teddy bear with a meaningless punch line such as ‘Together towards a brighter future’. Euros are spent and nothing is changed. And car commercials. Year after year, decade after decade, they say the same old thing. Performance for those who know what they want. 

Luckily enough we also have some inspiring examples as well. Take, for example, TV ads by Lidl. They take people’s prejudices and turn them into entertainment. As a bystander, I dare to claim that Lidl’s advertising changes people’s attitudes and brings in new customers. And amongst all that lame car marketing, VW Passat’s ad The Force is a refreshing clip to watch. 

But as an advertiser, you can use much more than just seconds and advert millimetres to further your goals. Change the entire domain’s game and conquer new fields by means of cunning repositioning. All you need is an inventive new concept, and there’s no going back. 

By adding oat bran and raisins to a basic almond chocolate bar, you got yourself a muesli bar that is sold as a snack. Muesli bars created an entirely new product group and it’s added value brought on some added price as well. There was no competition, and the old basic chocolate bars were left to compete amongst themselves. And somebody came up with the idea of adding caffeine and C-vitamin to sodas – and along came the segment of energy drinks. 

Swatch makes cheap digital watches, but it has made people believe that watches are actually jewellery and accessories. And that you must have different kinds of them for different occasions.

Repositioning seems self-evident after somebody has invented it: organic, light, SUV, small laptops. But it’s self-evident only after it’s already on the market, so be alert, or you might miss a great opportunity.

But Pärtsi and Lede think they are in the fashion business and vow in the name of hype, outrageous egos, ever-changing professional slang and personal brands. I think it’s understandable that the company management interested in its marketing results doesn’t want to have anything to do with this. But marketing has nothing to do with hype. How marketing works is entirely logical and comprehensible. It is easy to use marketing as a tool for getting real results. Its effects can be seen immediately.

Companies, which management uses marketing as a tool, tend to increase their already substantial marketing investments. When company management outlines its marketing objectives and sets clear goals, marketing is logically incorporated into management activities.

‘What tools do you use to measure the development of your brand value?’
‘With your agency, how cost-effectively do you reach your goals?’
These questions do have sensible answers, and those are the ones you should be striving to get. And then you’ll see that a TV spectacle with half a million budget isn’t such a good idea anymore.

Marketing is an investment to create a competitive advantage to a company. With marketing, management executes necessary changes in the markets. Returns of marketing investments are closely measured.

Not such a bad way of thinking after all.

So an average consumer dismisses around 99,9% of all products on the market. The figures might not be as staggering here in Finland, but the phenomenon is the same. And it is not a new one. This phenomenon has been rising for the last 30 years. The before mentioned figures are from the turn of the millennium.

The equation is harsh. It means that we no longer compete on the attention of consumers, we are at war. A million products are desperate to become the next ‘it’ thing. War and desperation do not make a good match.

Advertising has always been one of the means of getting attention. The depression on 1990s dragged down many good agencies with it, and cleared the way for new trendy agencies who made their money in the upcoming attention value war. They made clients believe in this new amazing form of advertising, which only aimed at creating attention value. More experienced clients realized that this new form was nothing more than a twisted and sick mutation of advertising and turned down the offers. But many inexperienced advertisers paid a high price.

Spectacular productions, one always more spectacular than another, conquered our living rooms. These expensive films left the viewer with nothing more than desperation and confusion on what they needed to be interested in and why. And that was a fatal product mistake if any. In any other business, the client would get his money back for such misunderstandings.

In the last decade, many awards were granted to a campaign, which resulted into minimum sales with maximum production costs. Naturally the client was not the one to give the award, but a jury of other advertising professionals. It’s a rather peculiar but yet vibrant institution in advertising. I think it’s rather like a group of doctors awarding a surgeon on the impressive use of knives, despite the fact that the patient died.

Simple attention value is like farting in an elevator: everybody is imprisoned by it for a moment, but you cannot pretend it’s something else.

The brave new world of attention value war had also a destructive effect on how young advertising designers saw their own work. Many of them still seem to think they’re in the fashion business. You only need to take a look at some advertising discussion boards, where designers dismiss each other’s creations: ‘Oh Christ, that’s so lame. That was done more than three years ago at (agency X)!’

Some more statistics: 99% of all new products on the market vanish in less than a year. Is the lack of attention the cause? Or perhaps the fact that these products don’t offer anything interesting to buyers?

I vote for the latter cause. People using the Internet are like bees. If somebody finds honey, he shows his mates the direction and distance to it and before you know it the entire tribe knows the where the honey is. This is why Apple products are sold out even before the first commercial is aired. And vice versa, as Microsoft’s software updates are always launched with great media coverage but sales might still be slow, as buyers cannot find features worth investing in.

Consumer is a good, suitably blunt, word to describe, well, a consumer.

All the nice, warm-hearted people we know and consider good friends are actually quite different in their nature as consumers. Consumer is much like a child prince – interested only in his own pleasure. He uses power without control. He has no values or principles. He leads an abundant life. Each day merchants carry their products before him hoping that he might show interest in them. A consumer is in dept to no one and responsible for nothing. If he is not interested, he’ll simply flick his remote control: new offers replace the uninteresting products.

A child prince honours us with one-second audiences. Unless he sees an instant promise of pleasure in our advertisement, he’ll turn the page or change the channel. Humour and entertainment are simple free bonuses for a consumer, as they obligate him to absolutely nothing.

This all might sound like a desperate starting point for advertising design. But in reality, all this simply set effective guidelines for our work. We are not in the fashion or art business. Our job is to create marketing communications, which produces real results.

The recipe for good advertising is actually really simple: promise something relevant. Make sure that the audience gets it the first time. Make it sound entertaining, but yet understandable. Give clear instructions on what to do. Eliminate all unnecessary content. Wrap it in a likeable packing.

That’s all.

Simple and easy. And easier than trying to find indicator in a BMW.