It’s a famous quote, attributed to U.S. retail magnate John Wanamaker, that’s become a kind of aphorism about advertising. The quote is used inside marketing departments and agencies around the globe. It’s often said with a hint of humor, a tiny bit of tongue-in-cheek, but it isn’t a joke. It’s a cliché with clout, and it’s become accepted as an accurate observation. Is it? Is half your ad budget really wasted? If so, why couldn’t you figure out which half? And, if you can’t figure out what’s not working, how would you know how much isn’t working? Why couldn’t it be 35%? Let’s take an ax to this axiom.
Who was Wanamaker?
John Wanamaker was born in 1838 and died in 1922. He was a successful businessman, a political figure, and from 1889 to 1893 he served as Postmaster General of the United States. His estate, at the time of his death, was worth more than 1½ billion dollars in today’s money. What’s also interesting, given the quote, is that he was considered a proponent of advertising and a pioneer in marketing. When he made his often repeated remark, he was alluding to how difficult it was, circa 19th century, to quantify the response to advertising. That’s true enough.
Dollars and Sense
We don’t actually know when Mr. Wanamaker said his now famous quote, but it had to be, at minimum, 100 years ago. He passed away in 1922. The mathematical business concept of Return on Investment (ROI) was 8 years old when he died. Marketing research surveys got their start in the 1920s. For just about the first 38 years of Wanamaker’s life, there was no such thing as a phone. There were no computers, no calculators, no social media, no websites. What Wanamaker could do was what a lot of advertisers still do. He could ask, “Did my sales go up during the time my advertising was out there?” He could look at how an entire campaign functioned.
Half and Half
Imagine the Wanamaker quote coming from a marketing executive at Procter & Gamble. If true, it would mean the giant firm was spending around $4 billion a year for no particular reason. That never has and never will happen. Today, Procter & Gamble can pinpoint with significant accuracy where each dollar goes and what each dollar generates in return. Obviously, P&G has considerably more tracking available than Wanamaker had, and today’s tracking is considerably more accurate. However, some of the money any company spends on advertising can’t be quantified. And that’s okay. Advertising creates a perception of the brand in the marketplace which can have a delayed reaction in generating business. The perception of a Corvette that a 16-year-old has, can help turn him into a Corvette owner as an adult. How do you accurately measure a cause marketing campaign, what price tag can you put on public relations?
The Myth Persists
The quote marches on. Look at it this way. The farmer says, “Half my eggs are bad, but I can’t tell which half.” You would need to know how to identify the bad eggs in order to determine that half are bad. What Wanamaker said is, at best, an anachronism. In fact, he may not have even said it. The quote is also attributed to UK industrialist Lord Leverhulme (depending on which side of the pond you live). Half of the quotes we read, were actually said by someone else. Except we don’t know which ones.