The Washington herald., 1918-08-26
By Hon. william n. coIver

Discontinuance or even sharp cur
tailment Of advertising because of
temporary war conditions. would
seem to imperil the most valuable
asset that any business has-namely,
its goodwill. No more faulty logic
can be found than that which would
impel q manufacturer TO cease build
ing for the future by means Of ad-
vertising simply because the output
Of his factory Ia. for the time being.
restricted; or because diversion Of his
facilities to war work has operated
to withhold his goods from sccus-
toned markets. In modern business
there can be no sufficient-unto-the-
day policy.
In advertising the business man has
built UP the intangible or spiritual
side of his business. IL such IL may
be designated, as distinct from the
material side. II is the spiritual side.
as represented by goodwill. that is
slower OF growth and that is the
more seriously jeopardized by neg
lect-neglect which could take no
more disastrous form than an inter-
ruption to advertising.
For example, IL I have the requisite
capital can build alongside the plant
Vi lnC SOluIuDld 1TdpndpnOnC
pany q factory equal in all respects
to the Columbia mandatory. As
sumo that / can turn out an instru-
ment comparable in every way TO
the Columbia product and in equal
numbers. Yet ! am not even q going
concern. I cannot sell that instru-
| ment to the public in profitable guam
titles until i build up the goodwill
that the Columbia Company has ac-
| quired by years Of advertising.
Goodwill, in my estimation, is far
more valuable than the physical prop
erty with which 1t IL linked. The
physical property is, in q measure,
useless without the vitalizing spark
| Of goodwill. The Proctor & Gamble
plant might be completely destroyed
by fire. and yet the havoc would not
extend to the commercial Identity
represented by the name Ivory Soap.
Far from sustaining loss, the good
will inherent in the word ivory
would. IL anything. be enhanced by
reason OF that trait OF human nature
which makes the public the more
eager to obtain that which is denied
to IL or which Is obtainable only over
difficulty.
That, at times such as the present.
there should be some hesitancy re-
garding advertising policy may be
because II has never been scientifically
determined what proportion of ad-
yertising expense is an operating
| charge and what proportion a capital
charge. In my estimation. only q
small part. IL any. of advertising ex-
penditure is properly chargeahle as a
| current item OF sales expense; but is.
rather, when translated into terms
/ of goodwill, a permanent investment
and hence a capital charge. Given
this conviction. it must appear quite
as short-sighted TO discontinue ad-
vertising merely because the war has
momentarily interrupted distribution
as II would be deemed unwise Of a
manufacturer to junk portion of his
factory equipment because there had
been interruption to it's use.
| The manufacturer who has con-
verted his factory to war work and
has therefore interrupted the pro-
duction of his original line, does not
tear down and discard his expensive
machinery to save the insurance pre-
miums or other similar expenses. II
would be just as sensible for manu-
facturer, whose commercial integrity
4 is founded upon advertising, TO aban-
don his advertising campaign in
order TO save the carrying charge on
his greatest asset-good-will.
Many .saIes" Made Long In Advance
Not the least Of the considerations.
certainly, that argue for the continu-
ance without interruption of the ad-
! vertising of all the concerns that viii
come back after the war. is that sales
are in reality made long in advance
Of the actual transaction that we
commonly refer to as the sale. "
This will be especially true in the
war period.
For example. I have no doubt that.
| even under the normal-pre-war con
ditions. thousands of persons who
did not possess a musical Instrument
were sold on. say, the fChickcrinG
piano. They might be without means
for the time being to cSrry out their
determination to own a Chickering.
or there might be other deterrinS
reasons-for INSTANCE. family might
be planning remo' al to a new home.
and therefore disposed TO postpone
purchase. The Underlying fact in each
such case is. However. that the pros
pect had absolutely made up his or
her mind t5 some day own a piano
and had come to the conclusion that
the piano when Il is purchased will
be a Chbekering.
Such anticipatory sales may not be
precisely on a plane with transac-
tions where an initial payment has
been made. but certainly they do have
a real value. and are a part Of the
intangiblel assets OF the business. For
the maintenance of such an asset
however. II is essential that there be
reiteration, and reminders IN the form
OF continuous advertising that keeps
alive the interest and the conviction
OF the prospect once won. Otherwise
a competitor. with repeated well-told
selling talks. will effect the mental
sale and hold It It would appear that
the opportunities for thus. in effect
making sales for future delivery must
be especially favorable during the
war, when the barrier to immediate
consumption of the trade is likely 70
be found not in lack OF purchase
price, but in Inability to obtain de-
livery OF the gbods.
Seemingly the prospect who Is con.
verted by Advertising under such cir.
cumstances is likely to be especially
firm in allegiance. I fancy hear him
saying: 81 may not be able to gel
wesson's Oil NOW. but when I get 8
Lam going 10 have it." The NOR,
rapid turnover OF money that ha.
come to a considerable portion Of the
population incident to the war periot
is bound TO encourage the PLANNING
in the present for purchases that viii
be made in the future. when stock
of goods again become available.
ina agine / can hear many a citizeI
reasoning somewhat in this wise: &c
have always wanted that set o
| Dickens or that Pianola hut I uu
off making the purchase. ana now
can't get them. However, you cal
bet that as soon as we get out o