Showing posts with label de-marketing. Show all posts
Showing posts with label de-marketing. Show all posts

Saturday, 9 March 2013

Accidentally on purpose: strategic ostensible demarketing


When BMW announced in 1997 that it was having to restrict supply to the UK market, this was an example of strategic ostensible demarketing.  

  • It was ostensible because it is clear that no rationing of these luxury cars happened: the company's sales kept rising from 60,000 cars back then to 180,000 in 2012.
  • It was strategic because it was a decision made and announced by BMW itself.
  • It was demarketing because the threat of restricting supply seems to have been made in order to boost sales.

Graphic from psdpond.com
BMW, like Coca-Cola, Heinz, supermarkets and the music industry were happy to profit from the theory of psychological reactance, which predicts that when you take something away from people they only desire it more. This may be an accidental outcome (we could call this serendipitous marketing, and was what Coca-Cola claimed had happened), or it may be a clear choice (Kotler and Levy defined ostensible demarketing as "giving the appearance of demarketing" 1977).  

It is almost impossible to find examples that conform to Kotler and Levy's definition: to do so the company must have admitted that their intention all along was to deceive the public. Coca-Cola, with sales and market share rising following demarketing, shrugged it off saying "We are not smart enough for that" (Clifford 2009). BMW said nothing but kept importing the cars and counting the money.


References

Clifford, Stephanie (2009), “Coca-Cola Deleting ‘Classic’ From Coke Label”,
Kotler, Philip and Sidney Levy (1971), “Demarketing, yes, demarketing”Harvard Business Review, November-December, pp. 74-80



Friday, 8 March 2013

Psychological reactance


Ostensible demarketing happens when professionals attempt to restrict or prevent the way a product, service or brand is offered: whether by accident or design, the threat of withdrawal paradoxically increases its desirability.  

This phenomenon was identified by nearly 50 years ago by Jack Brehm who called it “psychological reactance”.  Brehm (1966) argued that when the freedom to act in a particular way was taken away, or when it was suggested that this freedom was about to be withdrawn, consumers would invariably persuade themselves that the item in question was better than they had previously thought.

Since  Brehm's classic study was published the theory has been tested on a range of products (for example Mazis et al 1973), and has provided plausible explanations for numerous marketing phenomena where consumers appear not to have acted in the manner predicted by economists.


The claim about theatre owners is often attributed to
Samuel Johnson, but I haven't been able to find the  reference.
Picture from Wikimedia
The terms ostensible demarketing and psychological reactance both sound like grandiose theories of consumer behaviour, but in fact state something which is well known to ordinary people.  We often call it reverse psychology, and parents will tell you how they persuade their children to do things by arguing the exact opposite.  You will also find that a good strategy for selling something is to let it be known that it isn't for sale.  And, as theatre owners discovered in 17th century Britain, a powerful way of selling tickets was to get the word out that the show was sold out.

Ostensible demarketing seems to have been coined by Kotler and Levy in a Harvard Business Review article from 1971.  Their definition talks of creating the appearance of demarketing as a way of boosting demand.  This definition is problematic: although there are lots of examples of marketing people running successful campaigns where products have been withdrawn or advertising banned, it is hard to find marketers owning up to this sort of deception.  Hardly surprising, really: who is honest enough to admit to dishonesty?




References

  • Brehm, J.W. (1966), A theory of psychological reactance, New York: Academic Press
  • Kotler, Philip and Sidney Levy (1971), “Demarketing, yes, demarketing”, Harvard Business Review, November-December, pp. 74-80
  • Mazis, Michael B., Robert B. Settle and Dennis C. Leslie (1973), “Elimination of phosphate detergents and psychological reactance”, Journal of Marketing Research, 10, pp.390-395