Tuesday, June 24, 2008

The Physics of Marketing - Newton’s Law of Gravitation
April 25, 2008

Nothing here is revolutionary, but I think the thought process is very interesting

Perhaps one of the most widely known principles of science is gravity. I say this knowing that while most people could probably not explain gravity very well, just about everyone understands the idea. This was Newton’s blockbuster idea. It explained ocean tides, comets, and even led to the discovery of Neptune.

So what is Newton’s Law of Gravitation about? Well, here goes…

Newton basically asserted that “every object in the universe attracts every other object along a line of the centres of the objects, proportional to each object’s mass and inversely proportional to the square of the distances between the objects.” This theory served to explain much of the earlier work of Kepler in one concise theory. While Newton’s Law of Gravitation was later proven not to apply to all objects (black holes and situations with extremely high gravity) by Einstein, his work is a foundational part of modern scientific thought.

So in my feeble mind it seems that Mass and Distance are the keys here. Now how to take these ideas and put them in the context of Marketing?
Because people are not always rational, I am not sure you can apply an equation to human behavior with much precision, but I definitely think that there are parallels to be drawn. Here is my first take. Think about customers. Big brands get big attention. People know Coke. People buy Coke. Coke is massive. Coke has pull.

So how do little brands stand a chance of getting some “pull” with customers. The answer lies in proximity - the other part of Newton’s Theory. Small companies must get close to the customer in order to stand any chance of survival. They can actually use this to thrive and exert considerable influence if properly executed. Would a proper analogy be the impact of the relatively tiny moon on the Earth’s tides as opposed to the sun’s impact on them? (I ask because I am not a scientist) The moon has huge pull on the Earth’s oceans, and impacts the tides because of proximity. Certainly it has far less Mass than the giant sun. Still it is close. So, continuing my example in the world of soda pop, (using both terms to be user friendly) Jones Soda has done a great job of being “the moon.” They decided to get close to consumers - actually putting photographs of them on their packaging. This has allowed them to build a loyal following of consumers who are engaged with their products. They conduct events that are designed to be built around the consumer as well. They have done a masterful job of utilizing this principle to create growth.

Here is the rub for most companies. How to maintain that proximity. Starbucks is feeling this pain, Jones is probably going through it as well. As you gain more mass, it is actually more difficult to remain close to the consumer. The proximity or closeness to individual consumers tends to suffer as companies experience growth. The distance increases, and they exert less pull. In summary the moon becomes more like the sun, just not nearly as big. Thus the advantage it enjoyed thanks to proximity is destroyed. Jones becomes more like Coke, but without the Mass to sustain the gravity.

Wonder why your favorite brand “sold out?” Well because they were faced with this dilemma. How to stay close and simultaneously get big. How to maintain or increase pull? “Selling out” is just a natural part of that. People inevitable pick Coke, because it carries a lot of weight. It has mass - and thus gravity. It pulls people back. To sustain that mass Coke invests in Mass media, mass distribution, mass exposure. It must sell a lot of soda pop to sustain that mass and gravity. This is why small companies don’t need Super Bowl ads to thrive. They need super customer service.

Marketing in my mind is all about the customer. You can have gravity through mass or proximity. You might be able to get both, but often you have to choose. There is no “right choice” but recognize that with that choice comes the implications of gravity. Growth for growth sake - more mass - might not always be the answer.

1 comment:

Bob Cooper said...

A great physics response from George E Mavko[gemavko@raytheon.com]on the Physics of Marketing!!!!!


I suggest you take this another step (several decades ago, I was awarded a PhD in physics, so you got my attention).

First of all, the sun's influence on the tides on earth is indeed less due to distance, but the effect is real - when the earth is closest to the sun in it's orbit and the moon and sun are aligned, we experience maximum tidal effects. Your analogy could extend to a hierarchy of larger to smaller companies that all affect each other - although when you start talking about more than two objects, the math becomes impossibly complex...

Secondly, I suggest that calling on Einstein rather than Newton might be more instructive. According to the General Theory of Relativity, an object's mass changes, or distorts, the shape of four-dimensional space/time in it's vicinity - the closer to the object, the stronger the effect. Instead of thinking of the effect as a force, think of smaller objects simply reacting to the distortion of space/time created by larger objects. In the business side of the analogy, a large company affects
(distorts) the market space/time in it's vicinity, creating an environment that smaller companies must naturally react to. Just as the sun dominates space/time in our solar system, a large company will dominate the ecosystem it inhabits.