I am really excited about the Hackett race. First, I was born in Cincinnati and my parents still live there. I visit a few times every year where I remember what it was like to see the 1975 Reds play baseball (a great time to be a kid) and eat Skyline Chili.
But, more importantly, the Hackett race represents an incredibly important fundamental shift in the way Democrats view elections. Below, I will show the difference from an economic perspective using hypothetical numbers. The new strategy is economically superior.
First, let’s say there are 2 brands: D and R. R is the dominant brand and D is the minority brand. Each company has 1 million dollars for marketing its product, and the companies are attempting to gain market share in all 50 states. Further, each company’s current market share corresponds to the results of the 2004 election. In other words, brand D is the dominant brand on the West Coast, Upper Midwest and NE, and the R brand is the dominant brand everywhere else. To see the exact states, go to this link. Finally, each brand gets its marketing resources from the states where each respective brand dominates.
Here is an analysis of the previous brand D marketing strategy. They would allocate their 1 million dollars to states where they were already the dominant brand and states where they were within a few percentage points of becoming the dominant brand. They would not allocate any money to states where brand R was already dominant. This would solidify brand D’s position in the states where it was already dominant and hopefully pick-off a few states where brand R was vulnerable.
Let’s look at brand D’s plan from brand R’s perspective. Brand R is already dominant in a majority of states. Furthermore, brand D is not effectively cultivating brand R states, nor are they even trying to cultivate these states. As a result, brand R can draw resources from the states where brand R is already dominant without doing much to strengthen their brand name. This allows brand R to divert a majority of their resources to furthering their dominant status by making inroads into brand D’s market. In other words, brand D’s strategy will insure their minority status in the long run.
Let’s use some hypothetical numbers to make this illustration concrete. Using the 2004 electoral map, brand D is dominant in 19 states and brand R is dominant in 31 states. Brand R’s resource base – drawn from 31 states – is essentially unchallenged. Therefore, brand R takes resources from these states and allocates them to states where it is a close competitor. Because brand R does not have to allocate a large amount of money to cultivate their resource markets, brand R can divert a larger percentage of its marketing resources to expanding its brand name in brand D states. For example, under the old brand D plan, brand R would divert say 100,000 to its resource base and 900,000 to cultivate new markets. As a result, brand R will likely retain its dominant position because they can more efficiently and effectively allocate their resources.
Now, let’s look at the new brand D strategy where brand D starts to develop markets in states where brand R is already dominant. Under the old strategy, brand R allocated 100,000 to maintaining their resource base. Under the new brand D strategy, brand R must allocate a larger percentage of their marketing budget to maintaining its dominant position in markets where it is already dominant. In addition, brand D will start to lower the amount of resources brand R use to get from the states where brand R was dominant. As a result, brand R has less money to allocate to develop new markets. In other words, brand D’s new strategy puts brand R on more of a defensive posture, preventing brand R from expanding its product base.
This is why the Hackett race is so important. Before, the Dems would have done nothing, and the Republicans would throw some spare change at the race. However, now the Republicans have to send in more money and their best hired guns to insure victory. Imagine if the Hackett situation occurred in 2006, when the Republicans were already spending their money. Hackett would stand a better chance of winning because the Republicans might have less time and manpower to send to Ohio.
This is why the new 50 state strategy is so important. Economically, it puts the Republicans on the defensive. This will allow the Democrats to start increasing their gains at the municipal, state and national level.
And the Republicans say the Democrats don’t know economics.
