Albert Lasker, Part II
Brian Trumbore
President/Editor, StocksandNews.com

Continuing our story on Albert Lasker (1880-1952), considered the "father of modern advertising," in 1904, Albert was made a partner of Lord & Thomas and by 1912, he had acquired the interests of both Mr. Lord and Mr. Thomas, thus becoming sole owner.

Most advertising firms back then had just two copy writers but Lasker, recognizing the potential, hired 10. One client, Frank Van Camp of the Van Camp Packing Company of Indianapolis, was the first in the world to put both soup and spaghetti in cans. He was a large advertiser for these times, spending about $15,000 to $20,000 a year.

Van Camp wanted Lord & Thomas to do more than just place the advertising, he wanted "salesmanship-in-print." Lasker sought out Claude C. Hopkins, "the greatest copy writer who ever lived." It's unclear from the 1949-50 interviews, from which this series is adapted, just what Hopkins eventually did for Van Camp, but we do learn about other campaigns Hopkins worked on before moving to Lord & Thomas, including one for Schlitz beer.

Schlitz had been a poor second to Anheuser-Busch but with Hopkins's help it became number one for a spell. And it was all about sterilization. In Lasker's words:

"The Uhleins, who were the owners of the Schlitz brewery, wanted (Hopkins) to write their advertising, and they took him through their plant?.They showed him every operation and he wasn't impressed by anything until they brought him to a room full of steam where the bottles were being mechanically washed in steam.

"They hurried through the room and said nothing. He asked them, 'What is this process?'

"They said, 'This is the room where we sterilize the bottles in live steam to prevent germs.'

" 'Oh,' he said, 'that's most interesting.'

" 'There's nothing to this. Every brewery does this. We're not the only one. No brewery could exist without doing this to their bottles.'

"He said nothing to them, but when he submitted the campaign, it was only around that. In no place did he say that every brewery did not do it. He merely stated specifically that Schlitz did it. That message, which was a salesmanship-in-print message, made such a terrific impression on the public that Schlitz beer grew by leaps and bounds, as if a magic wand had been put over the firm."

Albert Lasker had a hard time securing Hopkins. You see Hopkins had retired, but eventually Lasker convinced him to go back to work and the two had a 17-year partnership. Lasker:

"I often had this experience with Hopkins. He would go see a client. In 24 hours he would have the answer that could, and often did, quadruple their earnings - even increase them by eight times. Within 48 hours he would write a campaign which would run a year."

And then there is the example of Quaker Oats. By 1909, the company was spending large sums advertising two prepared breakfast cereals, Wheat Berries and Puffed Rice. In the ads for Puffed Rice they employed Japanese people and figures. The rice was said to be large and very delicious. The Wheat Berries were advertised as a large wheat food. But Quaker Oats wasn't successful with either.

Lasker and Hopkins had trouble getting Quaker to disclose the margin on the products which were both 10 cents a package retail. When the company disclosed it, Lasker observed it "seemed too small to educate the public, for the public must always pay for its education."

"I won't go into the economics, the ethics, or the social implications of advertising - whether it is a good or a bad thing. The only thing is this: if the public is to be educated to the use of goods, it must pay the cost of its education. However, that comes back to the public in time, because the volume increases so much that the goods are sold at decreasing prices, and the public is always sure of the quality."

The whole puffed rice / wheat story originates with a Professor Anderson at the University of Minnesota. He was doing research on separating starch when one day he noticed a phenomenon involving some grains of wheat he had in a test tube. Lasker:

"The wheat, without being destroyed, rose to eight times its normal size?.He at once realized that even though he had not discovered anything which would be of aid in the research he was doing, he had discovered something which might be worthwhile commercially."

Well, Professor Anderson cut a deal with Quaker Oats and became a very rich man on the royalties as Quaker developed a process that included a wooden gun. Lasker:

"Into this gun, they put the wheat or the rice. The room itself may have been a hundred feet long. This gun was really a drum which they subjected to great heat. The mouth was covered. Then, automatically, when it had reached this great heat, the covering of the gun was removed by means of a pulley. From the pressure, the grains came out and went up to the ceiling - all over the room - and expanded to eight times their size."

So Hopkins told Lasker, "I know how they should advertise that. They should advertise the process, because they have something unique there. They have an exclusive thing." Hopkins said he would promote "The food shot from guns?.We'll show pictures - or drawings - of these guns. We'll show the grains hitting the ceiling."

Personally, I'm having trouble visualizing this, and I can't say it would have worked with me, but the bottom line was business absolutely soared within weeks.

The next step was to convince Quaker that it was foolish to advertise Puffed Rice and Wheat Berries separately. And Lasker and Hopkins had other thoughts.

"Certainly, advertising to the American people that you're going to 'Japanify' them is not an appeal," Lasker told Quaker. "They will not respond to an allure for a lower standard of living. You could do nothing worse than to associate your merchandise with that. That has been one of the big things that has held you back."

As big as Quaker Oats had become, Albert Lasker said "they weren't trained advertising minds."

On the issue of separating the products, Lasker told Quaker:

"What we must do is advertise the process?.No matter how separately you advertise it, the public will know that it's just wheat and rice processed the same way when they eat it. They'll know that, and you won't fool them."

Lasker then suggested they change the name of Wheat Berries to Puffed Wheat and just like that Puffed Rice and Puffed Wheat were born. Then he tackled the issue of margin. Lasker said they didn't have enough. Quaker replied:

"We give 22 ounces of Quaker Oats for ten cents. We only give eight ounces of Puffed Wheat and Puffed Rice. It's a very big package, but there's so much air in it that it isn't heavy. We couldn't give more, because with the bulk it takes, the transportation charges would be too big. The stores wouldn't handle it. Our overhead is such that for ten cents we can give them only eight ounces. We couldn't charge more."

Lasker and Hopkins countered, "Look, anyone who buys this knows he's buying a luxury. Eight ounces for ten cents is no more out of line than is eight ounces for twelve cents. No one is being fooled, and you haven't enough money to educate the public."

Quaker raised the price. Puffed Rice and Puffed Wheat became huge money earners, almost equal to Quaker Oats itself.

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Wall Street History returns with the final installment of the Albert Lasker story?the marketing of Camels, Chesterfields and Luckies.

*The source for this material is an article for the December 1954 issue of American Heritage magazine titled "The Personal Reminiscences of Albert Lasker," as told to Professor Nevins and Mr. Dean Albertson in a series of interviews, 1949-50.

Brian Trumbore

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