It was reported yesterday that Walmart is seeking proposals from its ad agencies as to how to deliver better operating and cost efficiencies.
The request wasn’t for better ideas that could build their brand. The request was for how to reduce costs.
I know two ways in which Walmart could reduce costs.
One, stop advertising altogether. Since Walmart spent $1.1 billion on advertising in the U.S. alone last year, that would be a substantial savings.
Two, come up with better advertising ideas. After all, the best cost-efficiency measure in regards to advertising is a great idea, executed superbly.
Why is this?
Simply because great ideas get noticed quicker, so less media dollars are needed. Great ideas are talked about more, so word of mouth spreads faster.
And, a great idea inspires people to become more motivated to buy the product.
The fact is, a great idea is the only cost-efficiency move that has ever been proven to work.
What dilutes the possibility of agencies coming up with great ideas? What Walmart is doing.
Cutting the fees that they pay to their agency. Procuring the creative to death. Asking fewer people to do more for less.
Yep, that should work.
Since Publicis & Hal Riney handles a bit of the Walmart business, perhaps Publicis should revive a quote that Hal Riney himself used to use when it came to clients trying to cut the cost of a production budget.
“If we can, through an extra $100,000 or so on production, increase the memorability impact and effectiveness of a $5,000,000 advertising budget, by even as little as ten percent, then we’ve added $500,000 in value for $100,000 in cost.”
Seldom did Hal get his budgets cut.
Seldom did Hal’s campaigns not succeed in building the brand.
Is there a connection? What do you think?