Opportunities Unlimited (1956)

[Music] let's bring our editorial microscope into focus on a very significant phenomenon the middle income consumer you may have met this character in Fortune's now famous series on the changing American Market which portrayed his dramatic rise into the dominant economic personality of our time this 1953 study showed that the zoom in the American market after the war the unprecedented volume of goods of all kinds gobbled up by an insatiable tide of buyers was largely the work of this middle- inome man let's update his story its basic facts and figures to the present day the biggest single fact in the story is this despite higher taxes despite post-war inflation the middle- inome consumer has roughly 50% more spending power today than he had a generation ago in real income $240 billion he has fed new demands into the production apparatus of Industry accounting for the housing boom appliance sales the rush for prepared foods even the once exclusive Preserve of the exclusive Rich the luxury Market has been invaded in force and virtually captured by the middle inome buyer and this is only the seagoing phase of a campaign that has succeeded in changing the entire shape of the luxury Market how did it happen through a revolutionary change in the way US income is distributed in 1947 27% of the population was in the middle income range earning between 4,000 7500 a year in all there were almost 13 million families in this bracket by 1953 as Fortune told us 5 million more families moved into this income category today more than a million more families have promoted themselves to Middle incomes in terms of dollars the families in this bracket now receive more than 42% of all income real income and their spending is just as is real food is now a $64.5 billion market up 8% since 1953 clothing sales up 6% from 1953 housing for the seventh straight year the industry has topped 1 million starts HomeGoods Furniture TV electrical appliances and such up 15% since 53 the family car 72 million Autos bought in 55 so far demand has matched the incredible pace of American productivity stride for stride let's look at the production story a moment over the past Century production per manh hour showed an average increase of 2% per year these two percentage points compounded annually doubled production over the last generation quadrupled it over the last two generations they made America but see what has happened since 1947 the yearly rate of increase has risen 50% and the implications of that rise are truly staggering if sustained as it seems likely to be it will remake America production per man hour is slated to redouble by 1980 but this productive potential if it is to translate itself into standard of living has got to be sold and in large measure sold to him thus marketing becomes the pivot on which our continued Prosperity turns marketing must make the growing production mesh with the expanding Market this is where the challenge Now lies to meet that challenge American business has taken a new look at its own attitude to marketing and advertising over the past 30 years the ups and downs of advertising activity kept pace with the ups and downs of consumer spending when sales Rose promotional activities Rose when sales dropped advertising dropped but in 1949 and again in 1953 and 54 there was a change as the volume of sales slid down advertisers countered by moving the volume of advertising steadily up for the first time advertising and selling were allowed to create sales instead of sales creating advertising and selling how come that's the question we put to a group of Manufacturers recently here are the answers the vice president of a leading camera company said in 1954 our advertising appropriation increased approximately 20% over 1953 whereas sales showed no change as a result we were able not only to hold our own in the marketplace but to stabilize our employment levels the president of a top oil company told us our plans call for a continuation of our present aggressive advertising and promotional efforts we fully expect our competitors to do likewise the president of the number one beverage company said businessmen today regard advertising as an investment rather than just a business expense and the president of a leading tire and Rubber Company put it this way advertising and other sales activity should not move up and down with minor changes in the total volume of business they should maintain a steady Pace geared to the overall growth Trend these statements represent a very real and important change in business thinking the feeling is abroad that aggressive advertising and marketing while they may not prevent short cyclical downturns in the economy nevertheless will have a strong stabilizing effect over the long Hall this is exactly what happened when 1955 moved far ahead of the 1953 54 dip the basic reasons for the new outlook are first a new confidence in the ability of government to help maintain economic stability businessmen now recognize that government is better equipped and better able to help check an inflationary or deflationary cycle that government is constantly on the alert for any sudden rise or fall in the business barometer second and far more important is the growing awareness of Business Leaders that the number one job of Industry today is distribution moving the goods into the hands of consumers matching desires with income prices with costs consumption with production this is the function of marketing and marketing as management now realizes consists of all company operations except only physical production all the services that help move the product to the buyer marketing research product designing product testing product servicing merchandising packaging pricing physical handling storage and transportation credit and financing accounting and billing sales organization sales force Sal sales Outlets retail selling advertising public relations where's the kitchen sink well if you happen to manufacture kitchen sinks there it is right on top the tangible product whose distribution depends on the successful interplay of all these 17 marketing functions a manufacturer has a complete marketing plan only if he has covered every one of these vital operations a third reason why businessmen have turned increasing attention to Creative Marketing is the changing American Market expressed in the zooming birth rate with bigger families back in style the amazing mushroom growth of suburban America the upgraded scale of income everywhere and especially the new pattern of income distribution which has Let its Bounty fall smack in the middle range of income as these groups continue to benefit as our birth rate and productivity grow they open the door to New Markets for additional goods and services to challenge the imagination marketing and advertising can and must rise to new heights as we come to grips with the opportunities that lie ahead our first and biggest opportunity is the expanding population markets are people with incomes and demands in the past 2 years alone our population has increased by 5 million a new American every 2 minutes according to reasonable estimates we should reach 175 Million by 1960 and as the 60s progress the babies born in the' 40s will be creating babies of their own meaning a new surge in the birth rate the promise for 1970 is a population of 195 million obviously these figures are charged with meaning for those who process foods and manufacture drugs Footwear an apparel in fact the increasing demand for goods and services is bound to reverberate throughout industry opportunity Highway construction as a nation our life is slowly being choked by our Antiquated highway system the government has a$ 100 billion Highway program which offers a profusion of opportunity for anyone with a stake in America from the lady who likes her eggs Country Fresh to the men who make Road building machines machery who can well look to a $250 million increase in sales a year new highways mean steel of all kinds and sales of Steel can expect to increase by $344 million a year cement concrete asphalt tar Road oils an increase of $435 million a year and just think of what will happen to the production Sales and Service of automobiles truck and bus transportation gasoline and oil and tires these functions account for nearly 10 million jobs meaning 10 million wage earners and their families better able to buy products of all kinds in every locality of the US opportunity rewiring the home it's a fact that four out of every five American Homes cannot accommodate the electrical wers of today why because most homes are not adequately wired for modern appliances here's a giant size opportunity an 8 billion order for raw materials producers of copper steel insulation electrical Appliance manufacturers and Distributors and the people who plan or work for them public utilities which must meet the resulting upsurge and demand for gas oil and electric power opportunity Urban Redevelopment think of a business any business industrial or consumer and then imagine the opportunities that would open for that business if our cities would step up their present Redevelopment programs our cities need enlarged parking facilities more bridges Redevelopment of slums add the crying need for New City Schools hospitals and recreation centers and urban Redevelopment emerges as the biggest single task and opportunity ahead less tangible but just as real is the opportunity in new product development the past is only an inkling of the future and look at what jet planes penicillin nylon television have meant to our economy and our Workforce this much is certain 10 years from now a good part of our Workforce will be making products as yet unknown we're now incubating in Laboratories a recent statement by a giant Electrical Company referring especially to electronic and atomic energy summed up the near future in these words the fields are so promising that we expect to produce more in the next 10 years than in all of the previous 75 years of our existence opportunity the suburbs 1/5 of America over 32 million people now live in the suburbs and a million and a quarter more are moving in each year this shifting tide of population carries with it a clamor for new shopping centers new schools new highways new fulfillments for off hours and Leisure Time as it builds Suburbia becomes a green pasture for every conceivable type of insurance line and Suburban living opens new opportunities for beverages of all kinds Sporting Goods the entire spectrum of consumer goods and services opportunity education the number of high school graduates has doubled since as recent a year as 1940 this in itself means opportunity to the business Community for it's a matter of straight statistics that the higher the education the higher the demand for more Goods better food more Leisure More Travel More education a people with high standards of education is a people with high standards of living opportunity Leisure Time the average American today Works 15% fewer hours than he did a generation ago yet his productivity is more than half again as high both Trends Rising productivity and shorter hours will continue the increase in leisure time now and in the years ahead is a creative economic Force bringing new needs hence new opportunities for marketing these are only a sampling of the great opportunities in store opportunities that could and should and will be seized by American businessmen to create more Goods more jobs more income and more opportunities for us all as WE peer into the future the sign for become visible even legible we know we are somewhere in the middle of a period of unprecedented economic change as one industry spokesman recently wrote for those of us who view history as a fascinating spectacle the prospect of the coming quarter century is exhilarating it is as if we were privileged not only to see but to participate in centuries of development telescoped into a brief span it is not too early to train your sights on this Prospect right now [Music]