The statements, opinions, and advertisements expressed on the ERA Blog and other online entities owned by the Electronic Retailing Association are those of individual authors and companies and do not necessarily reflect the views of the Electronic Retailing Association.One of my favorite business books is The Halo Effect and the Eight Other Business Delusions That Deceive Managers, by a Swiss professor named Phil Rosenzweig. Here’s a highlight from the book:
The most pervasive delusion [in business] is the Halo Effect. When a company's sales and profits are up, people often conclude that it has a brilliant strategy, a visionary leader, capable employees, and a superb corporate culture. When performance falters, they conclude that the strategy was wrong, the leader became arrogant, the people were complacent, and the culture was stagnant. In fact, little may have changed—company performance creates a Halo that shapes the way we perceive strategy, leadership, people, culture, and more.
The same can be said of DRTV projects. When they are hits, everyone is a genius. When they are bombs, everyone is an idiot. To paraphrase John F. Kennedy: Success has a hundred fathers, but failure is a bastard.
In the field recently, I sat with a client and reviewed a script for a product that was inspired by a current DRTV mega-hit. The client obviously didn’t like the script, so I pressed him for specific criticisms. He didn’t have many, but one thing he did have was a strong affinity for the mega-hit’s commercial. He mentioned it so many times that we decided to go online and watch it together. When we were done, I pressed him again for specifics. What exactly did he like about the commercial? Again, he struggled to come up with much to say. Flabbergasted, he finally blurted out the truth, “I like the commercial because it worked!”
In DR, the Halo Effect goes even further. Not only does it shine its angelic light on people, it illuminates entire categories. The result is a predictable phenomenon: Every hit will inevitably be followed by at least nine failed attempts to replicate that hit. Snuggie was followed by at least nine blanket failures. Olde Brooklyn Lantern was followed by at least nine lantern failures. And so on. I used to be smug about it until it happened to me a few times. Today, it’s so common that it isn’t even that interesting to point it out.
As a defense, I created several aphorisms, metaphors, and rules of thumb to help clients avoid this pitfall. “One is an outlier, three is a category,” I preach. “Beware the Siren!” I warn. “It takes seven to 10 years to resurrect a hit item,” I advise. But it does little good. The Halo Effect is too powerful.
In the field at another client’s offices, we were recently pitched a variation of a product that three other companies are currently advertising and distributing. That’s right: Three. Currently. Even if the new project were somehow successful on TV in that environment, it would look to go to retail amid a glut of similar products. Indeed, it’s likely it would arrive right as those other products were being marked down. No DRTV professional with any experience should entertain such items, and yet they do—all the time.
I admire Professor Rosenzweig for trying to counteract business delusions by educating us about them. But perhaps there’s a better way. Perhaps we should accept this particular cognitive bias and work with it. Here’s what I propose…
The next time you or I come across a really great item that’s curiously similar to a recent hit item, let’s agree not to trust ourselves. Let’s assume the Halo Effect is at work even if we think it’s not, and even if we can argue all the logical reasons why this time is different. Let’s agree to put that item in a drawer and set a reminder for, say, six months or a year later. At that time, we can take it out of the drawer with some degree of confidence that any Halo Effects have worn off.I’ve done this exercise several times, so I can tell you from experience what will happen: Many of the items I first thought angelic elicited a “what the hell?” once time had passed.
Photo by Arts of Chet Photography/FreeDigitalPhotos.net
Jordan Pine is a consultant specializing in short-form DRTV and the author of The SciMark Report (scimark.blogspot.com).