Photo Credits: willpalmer

While both sides of the aisle keep coming up with their own reasons why the $700 billion financial industry rescue package failed, there is one angle that nobody’s talking about: that one of the reasons the proposal failed is because of poor salesmanship.

First, the package proponents didn’t pay a lot of attention to the name of their “product”. When the press started calling it “bailout”, they didn’t think it was important. The word “bailout”, however, has many negative connotations: it can be equated with expense, giveaway, enabling bad behavior, etc.

If they had framed their product as a “buying opportunity” instead of a “bailout”, they would have made it easier for congressmen to sell the package to their constituency. Names are important. That is why the auto industry didn’t call SUVs station wagons, why Apple calls their earplugs pods, or why Kentucky Fried Chicken prefers to be called KFC.

The second problem was the pitch. Imagine if they would have explained the package like this: “The government will take advantage of buying grossly undervalued securities for pennies on the dollar, hold them for a while, and then sell them at a profit, which it will then give back to the American people. In the meantime, banks will have money to lend, the stock market will hold up, and you’ll have a bigger chance to keep your job”.

Instead, what we got was pretty much this: give us $700 billion of your hard earned money right now so we can help the big, rich banks or else the sky is going to fall on you.

Bad Product Name + Bad Pitch = Bad Results

Another piece of bad salesmanship was the lousy choice of spokesperson: President Bush, with his 69% disapproval rating, hit the airwaves pushing for the package. Is he the best person to try to sell this proposal to the American people right now? Would you be glad to order an expensive dinner from the same waiter who has been messing up your orders lately? Doubtful. You may want a different waiter this time. President Bush should have stayed on the sidelines, since his direct involvement probably made matters worse.

And what about Nancy Pelosi? After a strenuous week of tough negotiations, she finally had a deal, but she couldn’t resist bashing the Republicans one more time, right before the vote. Imagine that after a long and extenuating negotiation, a salesman hands you a contract for you to sign. Then, just when you’ve taken out your pen, he says: “Wait a second Mr. Customer, before you sign, I just want to remind you how stupid you are for having bought the competition’s brand in the past.” Great salesmanship indeed…

Ahhh, our wonderful politicians… They sure know how to smile for the picture, but they need to learn a thing or two about marketing.

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