In 1962, Time Magazine called David Ogilvy “the most sought after wizard in today’s advertising industry.” In his years as an advertising executive, Ogilvy created some of the world’s most successful marketing campaigns. As a content marketer, he was a pioneer of “soft-sell” ads that didn’t insult the intelligence of the prospect.

Those of us in the marketing industry today continue to gain inspiration from this father of advertising. His wisdom is timeless and routinely aims us in the right direction. Here’s a personal favorite quote of mine:

“Great marketing just makes a bad product fail faster.”

Straight and to the point (#datruth). Nothing makes you feel better about your marketing than a line like that.

I like it because it’s a reminder that marketing (and growth) doesn’t magically solve our problems. In fact, the opposite is true. Marketing only compounds our problems and ultimately could kill our business. Here’s why:

 

1. A change in form doesn’t translate into a change in substance.

We like marketing campaigns because it’s a chance to start with a blank canvas. In a sense, we can say anything we want to about our business. We can paint whatever picture we want. Take your very best day and tell THAT story to consumers.

The problem is that a pretty picture doesn’t change what’s below the surface and a compelling story doesn’t translate into a memorable experience. There’s no substance to support the form.

The truth is psychology never trumps experience. We should compel people intellectually only when a great experience supports it.

Science never trumps authenticity. We can use gimmicks and tricks and tested principles to get people to respond, but if the product or service doesn’t match, they’ll disconnect immediately.

Style never trumps truth. In this day and age, marketers with authenticity thrive. Period.

 

2. Increased high-cost traffic doesn’t grow high-return customer loyalty.

Look, new customers are like mortgage payments — you pay for the interest up front. In fact, you really don’t start paying down the principle significantly until you’re in the home for more than ten years. The longer you’re in the home, the more return you get from your mortgage payments.

I know this sounds simple, but the majority of the cost in acquiring a new customer or client is right at the start. I see businesses spend upwards of 300% of the initial purchase on just getting the customer. Why? Because they know that if they can keep them for the next year or two or three, the investment will pay off. The longer you keep the customer, the more return you get from your investment.

Here’s an example. A consulting firms sells an annual program of $18,000. They run a marketing campaign and spends $2500 to acquire a new client. 3 months in the client is unhappy with the service and exercises their 90-day addendum to terminate the relationship. The value of that client over the next 5 years was $90,000. Instead, the company lost money in the first three months. It’s a model that doesn’t scale.

Acquiring new customers with no long-term loyalty plan is not a profitable expense structure. It will put you out of business. Most people think that when it comes to new customers the expense model is variable — the more customers, the more profit. The truth is, the model only becomes variable in the long-term — when there’s customer loyalty. Otherwise we are dealing with a fixed expense model where many of us are spending too much to acquire a new customer. If you try to scale that, you’ll soon be headed towards bankruptcy.

The goal of a good campaign is to turn strangers into friends and eventually into family. That doesn’t happen over night or with a marketing conversion. It takes time.

 

3. Inadequate systems don’t scale with volume.

We all know that stress on an already broken system only causes it to crash. Marketing is not an excuse to turn your head to the side and ignore broken business systems.

Marketing will not solve a bleeding accounts receivable. It will only cause it to grow.

Marketing will not ease overloaded staff. It will only cause them to look for positions elsewhere.

Marketing will not make up for poor customer service. It will only multiply it.

Take your current problems and multiply them by the amount of new business you have coming in. That’s what you’re dealing with. It’s not a reason to be scared of marketing, but it is a reason to have a plan.

The fact is, we all deal with these issues to some extent in our companies. Those of us who are critical of our own business may read this and think we’ll never be ready to market. That’s neither the case nor the goal of this article. My advice is two-fold: First, understand that marketing doesn’t magically solve our problems. It actually makes them worse. Second, have a plan to address broken systems and customer loyalty. If you keep a hold of those two things you’ll be ready to go.

Last, if it’s tough for you to assess this objectively, bring in a consultant or trusted advisor to evaluate your situation. Ask them for their honest opinion. Where would you get the most return for your investment? Marketing? Staff training? Customer retention? It may be necessary to take a step back before you take a step forward.