Killing Marketing by Joe Pulizzi

Author:Joe Pulizzi
Language: eng
Format: epub
Publisher: McGraw-Hill Education
Published: 2018-04-05T04:00:00+00:00

Overall Business Profitability

One of my favorite interviews over the last five years was in 2013 when I interviewed Jonathan Mildenhall, then the head of the Coca-Cola Company’s Global Advertising Strategy and Creative Excellence (and now CMO of Airbnb). In talking about Coca-Cola’s Content 2020 project, he said:

But, for the more financially minded of the organization, I say this: If I can fill up the emotional level of the brand, then I have to trade on it less and less. Believe it or not, we’re still engaging with new consumers that don’t have their emotional well filled.

When I asked him about what “trade on it” meant, he told me that it was, of course, impossible to measure what any one YouTube video, or social post, or infographic contributed to the overall revenue or profitability of Coca-Cola. He said, of course we’re going to continue to spend money on paid advertisements. Coca-Cola is one of the largest media buyers on the planet. But more important, he pointed out, is the kind of advertising the company creates. He can drive people to drink more Coca-Cola through discounting it via coupons or “buy one get one free” types of advertising. Or he can “fill the emotional well” through content and get people to pay full price, or even a premium, for the soft drink. He looked at Coca-Cola as a media brand—and his theory was that if he could use a loyal audience of content subscribers that have their emotional well filled, then he would need to discount it (trade on it) less. He could basically affect the entire profitability of the company by using a loyal audience who values the additional experience over the commodity of the product.

When you look, you can see this same strategy is really at the core of Red Bull Media House. By most counts, Red Bull is the most expensive nonalcoholic drink available in any convenience store. And let’s be clear: the drink doesn’t win many taste tests. In fact, in 2006, the company used to advertise just how bad the product tasted. But through Red Bull Media House, the company has created such a loyal audience through content-driven experiences that customers are more than willing to pay the premium price. And because of the revenue (as Joe mentioned in the previous chapter), Red Bull has, truly, the ability to pivot into any business it likes.

Think about that for a moment. Red Bull’s marketing arm is actually enabling the company to sell anything it likes. It already sells high-margin content today. But tomorrow, if Red Bull decided to go into the fashion business, or sell bicycles or surfboards—it could readily do so with loyal customers ready to buy into just about anything the brand wants to bring their way. And they’d be willing to pay a premium price to buy it.

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