In my very first Marketing position, Fruehauf Corporation — at the time a Fortune 100 company – hired me to create a marketing and advertising department and perform all the marketing for 5 shipyards/shipbuilding divisions and 2 smaller manufacturing acquisitions. (See The Fruehauf Case History)
The day I was hired I was ushered into the president’s office and given a clear message:
“Marketing is an expense, Sales drives revenues”
Me, and my marketing, COST money. Sales was where the revenues came from. It took a LOT of effort to disprove this, but in the end the marketing campaigns I created continued to generate profits internationally for 12 years after I left the company. In fact, one of my campaigns outlasted the corporation itself, and was used by subsequent owners for another 21 years.
Concepts and truisms like these can become self-fulfilling prophecies. You will never, ever imagine that you could create a program like my Cash Flow Generator, where each new lead actually generated more money than our initial expenses, week after week.
The CFG starred John & Greg Rice, the World’s Smallest Twins. My choice of these two dynamos was easy for me, but I had to fight senior management and their preconceived notions of the company’s “image” and more. Nevertheless, in our early testing we generated thousands of leads and enough revenue to pay for the entire campaign. Over the next several years we averaged an MER (Media Earnings Ratio) of $1.42. Not so great if you’re selling $1000 exercise machines like another client, TotalGym, but unheard of for a lead-generating program. It meant we earned on average $142 for every dollar spend on media time. When you consider our raw cost was $8 for fulfillment, that meant we made money on every lead…the “Silver Bullet” of Marketing: a proverbial “Endless Money Machine.” Beyond that, we averaged $9,200 in sales per lead over their first 12 months…thousands in revenue whether they ever bought again or not.
After running 10 years, the CFG infomercial was acquired by Whitney Information Network, Inc. (OTCBB:RUSS). According to the company’s SEC filings the program Created $6.8 Million in revenues and 60,000 New Customers in its first 5 months, and tens of millions of dollars more over the next 9 years, becoming the Longest-Running Lead-Generating Infomercial In History. (See Case History Marketing Examples: International Media Holdings (IMH) and Success Development International (SDI)
All of which flies in the face of “Traditional Wisdom” on so many levels. Don’t let entrenched beliefs hold you back. Testing will prove what’s real, and what’s believed or assumed to be true.
(For more on this topic see also ) outside the box
