Standing on the shoulders of marketing giants.

Scientific Advertising by Claude C. Hopkins

“Truth is ever to be found in simplicity, and not in the multiplicity and confusion of things.” – Isaac Newton

Yeah … that’s not how it works.

For most of human existence, people did not understand gravity.

Humans understood that things fall down, of course, but only a few ancient mathematicians and astronomers (that we know of) ever seriously explored why. For a very long time, “things fall down because they do” was good enough.

Isaac Newton worked out that gravity is an attractive force (as had Indian astronomer Brahmagupta back in the 7th century). More importantly, Newton worked out the math. And his math works if you’re falling out of a tree or sending celebrities to almost the edge of space. But it turns out reality is a little messier than Newton’s laws can account for.

Einstein came along in the early 20th century with a better idea and a lot more math. He reframed gravity as the curvature of spacetime caused by mass and energy. Newton’s math still applies to apples, but Einstein’s work explains phenomena Newton could not have imagined.

There’s a point to this, and we’re getting there now.

A while back, I stumbled across a curious little book called “Scientific Advertising” by Claude C. Hopkins. It begins like this:

“The time has come when advertising has in some hands reached the status of a science. It is based on fixed principles and is reasonably exact. The causes and effects have been analyzed until they are well understood. The correct methods of procedure have been proved and established. We know what is most effective, and we act on basic laws.”

Hopkins was very much a proponent of direct mail, coupons, ad testing and long, informational copy. Nothing wrong with any of those, of course. Also, he was an unapologetic salesman who hated fun:

“Don’t treat your subject lightly. Don’t lessen respect for yourself or your article by any attempt at frivolity. People do not patronize a clown. Do nothing to interest, amuse or attract.”

Yikes. The Savannah Bananas would like a word, Mr. Hopkins.

“Scientific Advertising” goes on like that for 120 pages, and if you can wade through some stunningly casual sexism (everyone’s either a man or a housewife), you find the seeds of ideas like differentiation, customer loyalty, the Unique Selling Proposition and Reasons to Believe.

Hopkins wrote the book in 1923 after a long, successful career with brands like the Joseph Schlitz Brewing Company and Pepsodent.

Of course, we categorically disagree with his approach. Obviously, sales are important, but so are profitability and market share. Fame-building and showmanship are almost always the way to go, especially for smaller brands. You should absolutely “sing your selling message”.

There’s absolutely no doubt that Hopkins believed in his methods. Of course, calling advertising a science made it an easier sell. People loathe risk and uncertainty, and science is (or was) considered precise, mechanistic and predictive. If advertising is a science, then you can pretty much set your watch to it.

Of course, science is profoundly creative, but we’re not getting into that here.

We’re also not here to praise or bury Hopkins but to ask a simple question: Does advertising, as he put it, “act on basic laws”? Yes, but it’s far more probabilistic than Hopkins could ever dream of.

If Hopkins was Newton, Andrew Ehrenberg was Einstein.

Fast forward 61 years to 1984. Statistician Andrew Ehrenberg co-authored a revolutionary paper called “The Dirichlet: A Comprehensive Model of Buying Behaviour”.

Applying negative binomial distribution to consumer purchasing, Ehrenberg and the team discovered three foundational ideas.

Double Jeopardy — Larger brands have more buyers who buy slightly more often. The opposite is true and more relevant here.
Duplication of Purchase — Brands typically share customers with other brands in proportion to their market share.
Natural Monopoly Law — Larger brands tend to “monopolize” the purchases of lighter buyers in a product category.

Or, in plain English …

Customer loyalty has nothing to do with “loyalty” and nearly everything to do with brand size. Smaller brands have fewer buyers who buy less often.
Big brands share more customers with each other than with smaller brands.
In a given category, people who buy occasionally overwhelmingly choose larger brands.

This groundbreaking paper demonstrates why smaller brands are constantly playing on the back foot.

So how do we fix that? There is a playbook built on Andrew Ehrenberg’s work, and we’ll get to it next week.

See you then!

Sources!

Scientific Advertising – Claude C. Hopkins
“The Dirichlet: A Comprehensive Model of Buying Behavior” – Goodhardt, Ehrenberg and Chatfield
How Brands Grow Part 2 – Byron Sharp and Jenni Romaniuk