View Full Version : Marketing vs Business Models

Eamon Burke
09-04-2012, 04:30 PM
This is an idea I have been thinking about, and it ripened into a talking point in my mind due to another thread. Don't read this if you are going to get offended by it. I just think there's a lot of folks here who can relate to this, perhaps chime in an idea or two. There are lots of business owners here--restaurants, retail stores, white-collar firms, various self-employment trades, etc.

I used to have a small business advisor from the SBA who was an accountant, and I've talked with a bajillion people over my life, having my own business, my wife has a business, I used to run a lawn care service for myself, etc.

I have never heard the story of a business becoming a booming success because of a business model. That is how millionaires become billionaires, perhaps, but it's not how businesses ever grow from nothing into something. I keep hearing every person's and business' success attributed to random chance(right place, right time) or Marketing. It's got a vibe people like. The lady selling it is sexy. There was a TV show about it.

Local Fish shops in both places I've lived boomed after Finding Nemo, as long as they sold Amphiprion Percula, bringing many back from the brink of closing up, and creating budding Fishkeepers.

The bread company at my Farmer's Market is one of the most in-demand booths, despite their bread not being made by the people at the booth, or even very locally. But who works the booth? A slender 35 year old brunette with an Italian accent.

Facebook is worth BILLIONS of dollars, despite being essentially a free service that provides no tangible benefit. Banner ads!


When you talk to people advising you about business, Marketing is "the fun part" and focusing on branding and image is considered "daydreaming". You should spend your time with a calculator and a government website doing market research, analyzing competition, putting a premium on your time, ensuring there is an Excel spreadsheet for every possible question, planning life 5 years out, managing retirement before you start working, and squeezing every penny for all it's got.

I have worked for people who don't know JACK about their trade, their industry, or running a business, but can get investors, loans, and employees, and always manage to pay themselves, just because of an image. Part of the reason I can't deal with being an employee is because of things likes this. I worked at a Catering company that ran a cafeteria. Boss was the stingiest man alive, buttoned-down business, and extremely effective corporate style management(no hands on for the boss, minimum wage for the workers). Oh yeah, and piss-poor image, zero marketing. There were 12,000 people on campus every day, and the most we ever made in a day was $2400(total sales!). I was polled one day what I wanted the company to buy to make my day easier and more efficient, and I said "Advertisments." They laughed, and ignored the whole idea, and now they lost their contract to a Subway($5 for a bottom-of-the-barrel ham sandwich? Hello, marketing!).

The Marketing is what gets the money out of people's hands, and that is all that matters! Making a profit. Best business model in the world that's not turning a profit is useless, and a business run by a complete nitwit that's making some green will get all the help it needs. I keep getting told my business(any business) needs to be this shining example of expertise and discipline, but the truth is, people stumble onto giant piles of cash all the time, and good ideas often die for environmental reasons.

About a year ago, I read Tim Ferriss' book on the 4 hour workweek, and while some of his lifestyle is not what I would want(good for a single guy), a lot of what he says about making money is very true. It's not the money people want, it's the life that the money gives you. And if making that money destroys your life, what's the point? Then he goes on to show that most of what ends up ruining people's lives running a business is crap that doesn't matter.

Look at pretty much any Kickstarter or Indiegogo project--no business explanation, no value-priced goods, no ROI. $40,000 in a month to make sunglasses based on pictures and a logo. $1,000,000 in a week to build a Tesla Museum because the guy from The Oatmeal said it was a good idea. $100,000 in 3 weeks to make a documentary because it's about Big Bird.

I'm starting to think that a lot of business is intellectual masturbation and navel gazing. Produce something people like, that you like producing. Sell it for more than it cost you. Done.

Mucho Bocho
09-04-2012, 04:45 PM
Spot on Eamon. marketing and image is a perception that people make reality. Agreed, it doesn't even have to be a great product. No offense to Bose speaker lovers but they're really not great speakers, not by a long shot but ask an American what the best speaker is and they will say Bose. marketing, marketing and marketing.

Same goes for Ginsu and Cutco knives.

Look at the Cutco brand. Simply one of the crappiest overpriced knives available. But called The Home Maker, a crap product is transformed into a desired tool. Ask anyone that owns Cutco, they will never agree that they suck. If you disagree, I'll let you speak to my Mom.

Andrew H
09-04-2012, 05:49 PM
Have you read the Tipping Point, Eamon? You might enjoy it.
I do want to point out that the Tesla museum isn't a business but a charity [501(c)3 not-for-profit]. Also most indiegogo / kickstarter things give you something in return. For example, you get a pair of those sunglasses if you give $40.

09-04-2012, 05:58 PM
As I tell people, they say the world's oldest profession is prostitution. But marketing came first.


09-04-2012, 06:02 PM
Deliver a good product and treat your customers well, and you will build a good, solid business from word-of-mouth, etc. And, sadly, you will never make a lot of $ for your effort -- although hopefully you will at least have a comfortable life.

But it's all in the marketing and advertising if you want the $$. Over-promising and under-delivering does not matter much if you have enough people reciting your tag line, etc. because it's been hammered into them repeatedly They will think you product is good because your ads told them it was good. It takes some $ up front to mount some of those advertising campaigns, so the ol' 'it takes money to make money' mantra still applies.

09-04-2012, 07:10 PM
Ugh, if I was more of a hustler and schmoozer and less of a hard worker my bank account would definitely be more impressive! I've seen too many people in the restaurant business succeed, mostly short term though, through good marketing and branding. Funny enough my girlfriend just started a marketing and branding business.

09-04-2012, 07:21 PM
I have long believed that marketing is more important than a good product..

Eamon Burke
09-04-2012, 08:04 PM
well, I think a good product is paramount, but there are lots of similar products, yet some struggle for ever and the overnight successes are the cool ones. 6 months later it's on the news because a bunch of old rich people found out about how much money it was making so now it's being declared solid business in hindsight.

09-05-2012, 12:21 AM
A good product isn't paramount. Just look at what is being shelled out at late night tv. You get some exercise piece of **** that will break in about 4 uses, and you get to pay for it for a few more months.

Eamon Burke
09-05-2012, 12:59 AM
It can be done, but I'd hate doing it.

09-05-2012, 01:03 AM

There is also the Bob Kramer way he has going on. He puts out a good-great product that people like and are paying $$$$ for. But I think that has the 1% factor on his side too. Also remember he ran a wagon around sharpening for many years.

Salty dog
09-05-2012, 05:35 AM
People are sheep.

09-05-2012, 11:00 AM
I would argue that the vast majority of businesses that have been successful have been because of their business model. The thing is we dont hear about them because it is not an interesting story, it is the norm. We are much more likely to hear or be interested in a story about the rags to riches or overnight success, ect.

Marketing is not separate from a business model, it is an integral and critical part. Some catch the lightning in a bottle, some stumble into it but most successful people work hard and smart to consistently achieve successful.

Just my take on it.