I have to admit that in spite of living in the US for more years than most of the readers of this blog have been on the surface of the planet, Wall Street continues to be a deep, dark chasm of unfathomable mystery to me. Yes, I have worked on all kinds of financial ad accounts from Chase Manhattan, to Bank of America, to Merrill Lynch, to Charles Schwab. But I still don’t understand the financial market… And I have a sneaking suspicion that most of the people working in it don’t either.
For instance, at the close of markets yesterday, Hewlett-Packard announced that both revenues and profits were up significantly for the first time in the last three years. Which was when they showed CEO “Queen Carly” (Carly Fiorina) the door, helped along with a $45 million golden parachute, even though she had driven the value of this once proud company through the floor. But no surprises there. In common with many other American CEO’s who have almost destroyed once proud companies during their tenure after being showered with more money than you or I will ever see in our lifetimes, they leave and write a book about how they “Wuz Robbed!” Shades of Boo.Com!!!
Anyway, back to H-P. What was the reaction of Wall Street after the announcement of this sterling turnaround in the company’s fortunes? To a man, they hammered the stock driving it down by more than 6%. At the same time, its main rival, Dell computer, which has been going through all kinds of troubles and losing market share and profitability all over the place, is up nicely, thank you!
So, what’s my point here? H-P does great advertising, courtesy of Goodby, Silverstein and Partners. Dells advertising sucks… I can’t even remember who does it now; it’s bounced around so much. I only remember when I worked on it at Chiat back in the eighties, we did some pretty neat stuff, and in fact some of it’s on my web site. But, ever since then it’s been going downhill… He said modestly!
Which indicates to me that advertising can have a definite affect on a company’s sales and profitability, whereas it might not do anything for its share price.
But then again, the only thing less quantifiable than the stock market is advertising. Otherwise, we’d all be out of a job.
George Parker
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Member since: 03 Jun 2008
Last login: 17 Nov 2009
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