The 5 Biggest Disasters in the History of Marketing Ideas
It's easy to feel like we're all just cogs in some corporation's cash printing machine. Even when they offer us a deal, we assume that at some level, they're still making out like bandits.
Yet sometimes companies screw up so badly that you wonder if they, like us, are just making it all up as they go along. How else do you explain ...
McDonald's and the Olympics
Remember that Simpsons episode where Krusty Burger ran a huge promotion for the 1984 Olympics promising they'd give away burgers for every medal the Americans won? Krusty got steadily more enraged as the U.S. won event after event ("I will personally spit in every 50th burger!"). Well, that totally happened.
Sorry, Simpsons. This time, real life did it.
In 1984, the Olympics came back to the United States, and McDonald's went all-in with their sponsorship of the games. To show their confidence in the U.S. Olympic team, Mickey-D's came up with the "If the U.S. wins, you win!" promotion. Customers got scratch pieces with an Olympic event printed on them. If the Americans won a gold, silver or bronze medal in that event, the customer would get a free Big Mac, fries or Coke, depending on the medal.
"Now with steroids!"
Now, no business goes into a "win a free ___" promotion without having a fairly specific idea of how much free merchandise is going to go out the door. McDonald's probably looked at the U.S. medal count from the last games we had participated in, in 1976. In that year, the U.S. won 94 medals, 34 of them gold. After all, it was the Soviets and their allies who dominated the games every time (in 1976, Russia won 125 medals, and East Germany won 90, with 40 gold medals).
But the U.S. arguably had the best celebratory dances.
We have to go back to 1976 because the U.S. didn't participate in 1980, since the Olympics were held in Moscow and the U.S. boycotted the games because they hated the Russians. But that should have been a cue for McDonald's -- since the 1984 games were being held in the U.S., the U.S.S.R. and friends returned the favor and boycotted. Remember how we said Russians and East Germans finished ahead of the U.S. in 1976? Both of them would be sitting out the 1984 games altogether.
"We don't need you, we have a wall to play up against."
With the Eastern Bloc competition out of the way, the U.S. wound up winning significantly more medals as the last time around -- a mind-boggling 174 medals total. Instead of the 34 golds the U.S. won in 1976, the 1984 games saw the Americans bring home 83.
"I'm doing this for my country, for my family and for a truck-full of burger."
Which meant McDonald's had to give away much more food than they expected, including more than twice as many valuable Big Macs. There were rumors that locations were running out of Big Macs... that the customers didn't pay a dime for.
Did the CEO spit in every 50th burger? We can't know.
But yes. The answer is yes.
Walkers Potato Chips
O.K., so the McDonald's Olympics giveaway might looks silly now, but maybe at the time they thought some other country was going to step up their medal count. It's an understandable mistake. But then you have the Walkers Potato Chips weather prediction contest.
Also available: the wet-paint-watching contest and the staring into space extravaganza.
In theory, they'd be rewarding customers for predicting something far more unpredictable. If the customer bought a bag of chips for 40 pence (about 65 cents), they could go onto the website and try to predict when and where it would rain. If the customer could accurately predict the time and place, they'd win 10 pounds (about $16).
The secret to winning is checking the weather report.
Some of you have already spotted the problem by the fact that we're converting the dollar amounts from British pounds. Yes, this contest was held in England. In autumn. A time and place where the weather comes in two flavors: torrential downpour and "Oh, is it raining? I couldn't hear over the sound of slicing my wrists." Statistically, you have a better than 1 in 3 chance of it raining on any particular day. Also, Walkers gave out two entries per bag, doubling each participant's chances.
Somebody did the math and figured out that statistically, for every three pounds' worth of chips Walkers sold, they were paying out 10 pounds in prize money.
Finally, during an extremely rainy week when they were set to lose over 1 million pounds, the site "mysteriously" went down ...
"Oh, would you look at that? Better get those razors back out, guys!"
... with the promotion ending soon afterward.
Pacific Air Lines -- Fly the Fucking Scary Skies
In 1967, San Francisco-based Pacific Air Lines found itself in a tight spot. A well-publicized crash made customers nervous about flying, and a lot of other bad business decisions weren't helping.
"This will have to go."
Such grim circumstances called for serious action. Which is why they turned to a comedian to take over their promotions and save their airline. Specifically, this guy:
That's Stan Freberg. While most business leaders would say, "Might as well file for Chapter 11 right now," PAL put its trust in Freberg, which was pretty much a death sentence for the entire company.
"Forget better meals and basic safety standards. What I want on this flight is to laugh.
Freberg decided to address the public's post-crash mortal fear of flying using the power of edgy comedy. The first move was to take out a full-page ad, saying:
"Hey there! You with the sweat in your palms. It's about time an airline faced up to something. Most people are scared witless of flying. Deep down inside, every time that big plane lifts off that runway, you wonder if this is it, right? You want to know something, fella? So does the pilot, deep down inside."
"May as well wrestle with that hatch, 'cause that's the only way you're getting out of here, lady!"
To put it in a modern context, pretend that just after 9/11, United Airlines came out with an ad campaign that said, "Fly safe with United. After all, how many more terrorists can there be?"
It wasn't enough for Freberg to psychologically terrorize would-be passengers in print. Freberg was given the reins on a full-fledged "mock our customers' fear of death" campaign of bad comedy. Flight attendants passed out "survival kits," which included a lucky rabbit foot and a security blanket, on flights. When the plane landed, they would get on the intercom and say, "We made it! How about that!" Yes, every goddamn time.
"I will now go around the plane to pry the oxygen masks from your faces."
But Freberg wasn't done. He had plans to paint a plane like a train and play train noises over the loudspeakers. Because an airplane is not a train. Ergo, comedy.
With sales dropping, PAL fired Freberg, and two executives resigned due to the ads. Just months later, the company sold out and became Air West.
Silo -- A Shitload of Bananas
This is somewhat famous for being one of the stupider stories to ever emerge from the world of retail promotion.
Cool, informal slang is important in advertising. It catches the viewer's attention and makes him think your brand of breakfast cereal is "hip" and "edgy," and implies that using your product will finally win him some friends at school. But when employing slang, it must be made crystal clear that slang should not be taken literally. With that, let's go back to 1986.
Awesome! Jelly bracelets for everyone!
That year, Silo, a discount appliance chain, had way too many stereos and needed to sell them off for shockingly low prices. So they ran ads saying it cost only 299 bananas for a new stereo. Obviously, "bananas" means "dollars" here, though you'd be forgiven for not knowing since no one has called money "bananas" since Calvin Coolidge's day.
"That's absolutely bodacious. Possibly even groovy."
At this point, dozens of wiseass customers flocked to stores with literally 299 bananas (worth about $40). Which brings up the question: Where the fuck were people getting all these bananas? We can see a local grocery store having a total of 300 bananas on the shelf, but who the hell keeps enough on hand to serve a line of customers each asking for 50 or 60 bunches? Is there a special fruit wholesaler just for industrious smartasses?
Being an insufferable douche is just good business sense.
Anyway, the appliance store had no choice but to accept all the bananas from dozens of customers wearing what we assume were shit-eating grins. Silo lost over $10,000 in one just day, pulling the ads the next day before others could get the same idea.
The saddest part? Silo couldn't even get rid of the bananas (they had thousands of them sitting there, presumably attracting fruit flies), as the local zoos stopped taking them and the food bank didn't take perishables.
"Couldn't we just ... chuck 'em at some hobos?"
Tesco and Hoover Get Beaten at Math by Their Customers
As you can see, businesses seem to consistently underestimate the savvy determination and possibly greed of their own customers. Not that we feel sorry for them.
For instance, in 2011, British supermarket chain Tesco got into a price war with competitor Asda. Tesco announced that, by god, if Asda ever beat them on a price they would pay you the difference twice over. So if you bought 10 boxes of wine for 20 pounds each at Tesco, but could prove Asda had them for only 18 pounds, you could get back 40 pounds. That is how confident Tesco was that the average Tesco customer's shopping trip would contain nothing that could be gotten cheaper at the competition.
"Wow, Gary, I know your latest review said you were out of touch, but this is a masterstroke."
But this failed to take into account several things about human nature. Specifically, it assumed that customers would still only buy the things they wanted, rather than the items that would pay off the most in the promotion. Instead, customers simply scoured the two stores for whatever odd item that 1) happened to be cheaper at Asda and 2) had a price difference that was enough for the double-the-money-back guarantee to actually get back more money than what was spent. If you found some item that Tesco had for three pounds but Asda had for one, it meant that you'd get the item for free, and Tesco would have to give you a pound on top.
"They thought me too proud to price-check that lube. They were wrong."
People shared their strategies on the Internet and came up with ways to buy enough bullshit that they didn't actually need (but that gamed the system hardest) that it would cover the rest of their grocery shopping. If buying razors let you scam a free pound out of Tesco from the promotion, you could fill your cart with them and use the profit to buy food. After losing an undisclosed (but extremely large) amount of money, Tesco has since put a cap of 20 pounds on the promotion.
That's around the average price of a person's dignity.
And it's not like they didn't have any precedent to learn from. Back in the early '90s, the Hoover Company ran a promotion offering two round-trip airline tickets to Europe or the United States with the purchase of a vacuum (which gives you an idea of how much some of these vacuums cost). They for some reason thought this would encourage customers to buy the more expensive models, because the free tickets would justify it.
For a multinational corporation, they sure do have a lot of faith in human nature.
But, as you can now guess, customers who didn't even need a vacuum, but did need airline tickets, figured out that Hoover did in fact have cheap models (the fine print set the minimum purchase at just 100 pounds). So suddenly it was worth buying a vacuum you would never use, just to get the far more expensive free tickets out of it. People bought several vacuums they didn't need with the sole point of getting the tickets. Let's just say a lot of hobos and orphans got vacuums for Christmas that year.
"I empty the bag into Paul's dumpster. He hates it."
Hoover was absolutely overwhelmed with demands for tickets and started desperately fighting the claims, either stalling or trying to convince customers to buy something else in order to offset the loss. It became a media firestorm, and Hoover ended up losing 50 million pounds in what would be the single biggest failed promotion ever.
While parent company Maytag sold the European Hoover company off as a result, claims for flights were never fully settled until 1998. This fiasco ensured a new rule in marketing: Always make sure the free item given away never exceeds the cost of the product it is paired with. Especially if it, you know, can fucking bankrupt you.
See some more poor corporate decisions in 5 Corporate Promotions That Ended in (Predictable) Disaster. Or check out the 6 Global Corporations Started by Their Founder's Shitty Luck.