John Wanamaker makes a sale

John Wanamaker was born in Philadelphia, Pennsylvania, in the US, on 11 July 1838. At the age of 22 he was already well established as a retailer and store owner, and in 1876 he opened the Grand Depot, in an abandoned railway station in his home town. It was the “first-ever department store”, says Philadelphia magazine, with an estimated 71,000 customers visiting on its first day.

A PBS article on Wanamaker for the series “They Made America” says much of his initial retail success came from his reputation for fair dealing.

He invented the price tag, the idea of attaching a fixed price to goods, and thus eliminated haggling over the cost of items; in 1874, he also printed “the first-ever, copyrighted store advertisement”.

“When people discovered that its promises were true, business boomed. The concept of truth in advertising earned him the public’s trust, which he never lost,” the PBS article says.

Wanamaker also gained some notoriety for an often-repeated quip about marketing:  “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.”

Among the marketing innovations attributed to Wanamaker by Philadelphia magazine are set prices for all customers; polling customers as they left the store to gauge their satisfaction; buying full-page newspaper advertisements; employing a full-time ad copywriter; opening the first restaurant inside a general store; installing the first electric lighting in a store; regularly sending buyers overseas to study foreign markets; and inventing the “white sale” – typically discounts on bed and bath items, as a way to sell excess bedding stock during a normally slow time of year.

He went on to open stores in New York, London and Paris, and during World War I, he proposed that the US buy Belgium from Germany for $100 billion in order to end the war.

A deeply religious man, Wanamaker was president of the YMCA, and also served as the US Postmaster General from 1889 to 1893. He died on 12 December 1922.

Wanamaker appears to have been an instinctive retailer, making use of direct sales techniques and exploring the possibilities of print media. Today, even with the proliferation of new media leading to a tremendous rise in available platforms, his methods are easily recognisable to students of marketing.

Writing in Forbes magazine in 2012, Julie Zhou describes her journey from a maths-focused student, aiming for a career in investment banking, to a marketing analyst for technology giant Google.

“Marketing?” she asks herself, upon receiving an offer of employment. “Why was a company that had grown into a global powerhouse by living and breathing data hiring marketers?”

The answer came years later, she says, with the discovery that “marketing was unmistakably a science – it was the science of discovering what people loved about your product and of engendering love if none previously existed”.

“Much as Google used mountains of data to match a user to their precise search query, marketing in Silicon Valley required the same scientific approach of matching a user to the magic of your product,” Zhou says.

According to “A brief history of marketing”, published by Britain’s Bournemouth University and the University of Plymouth, marketing today is tied to developments during the industrial revolution of the 18th and 19th centuries.

These rapid changes separated the production of goods from their consumption. “Mass production, developing transport infrastructure and growing mass media meant producers needed to, and could, develop more sophisticated ways of managing the distribution of goods,” the article explains.

Today, because of the intense competition for customers, marketers “are involved at a strategic level within the organisation and therefore inform an organisation about what should be produced, where it should be sold, how much should be charged for it and how it should be communicated to consumers. Modern marketers research markets and consumers. They attempt to understand consumer needs (and potential needs) and allocate organisational resources appropriately to meet these needs.”

Writing in Psychology Today in 2010, Art Markman, a professor of psychology and marketing at the University of Texas at Austin, analyses a paper in the Journal of Consumer Research, titled “The Influence of Implicit Attitudes on Choice When Consumers Are Confronted with Conflicting Attribute Information”.

In the context of the study, Markman explains the concept of “affective conditioning”, a tool used in marketing in which advertising is used to cause consumers to transfer their feelings from one set of items to another.

He uses the example of an ad for detergent that has cheerful images of fresh flowers, cute babies and sunshine – things we feel good about already – to make us feel good about the detergent too.

“These results suggest that the most powerful effect of advertising is just to create a good feeling about a product by surrounding it with other things that you like,” Markman says.

“The problem is that we allow advertisers to have access to our mental world. They have paid for the opportunity to slip information to us about what feels good. That information ultimately affects the way we make choices, whether we know it or not.”