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Chapter 13 The Big Buildup Book: The Indomitable Tin Goose Subtitle: The True Story of Preston Tucker and His Car Author: Charles T. Pearson Publisher: Abelard-Schuman Year: 1960 |
13 THE BIG BUILDUP
THE TIN GOOSE would meet Cerf's condition that Tucker have “the semblance of a car” and he already had the plant, if he could persuade War Assets to go along with him until he put over the stock sale.
Tucker's agreement with WAA required that he have at least $15,000,000 cash by March 1. On February 26, less than a week before the deadline, WAA extended the time to July 1, conceding that he couldn't possibly have raised the money while he was fighting with Wyatt.
In a statement announcing extension of the deadline, Tucker said a registration statement for four million shares of common stock, at $5 a share, would be ready to file within the next week or so. When the first hassle with SEC ended around the middle of January, the commission was out in the cold; it had no authority over the corporation's affairs. But this situation did not last long, and it is highly improbable that SEC ever stopped its investigation, knowing Tucker would have to register his stock and would be right back again facing the bright lights and answering questions.
“Once its jurisdiction had been restored,” said a report issued later, “the Commission promptly authorized a private investigation to determine whether stop order proceedings should be instituted under Section 8 (d) of the Securities Act.”
Even after SEC cleared the stock it would still have to be sold, and that promised to be a problem. If Tucker could have put it on the market while he was still something of a public hero he wouldn't have had too much trouble, but the fight with Housing had cost him a lot in time and prestige, and a lot of people thought he was already out of business.
Publicity had built Tucker up into a national figure, but his free publicity ride was slowing down. There had been so many headlines that the newpapers were getting tired of him, and many felt it was time he stopped talking and started doing something. Actually he was doing far more than either the public or the papers knew, but it wasn't news. Now, with his prestige at an all-time low, he knew Cerf could never put over a $20,000,000 issue without help.
At this point, Roy S. Durstine entered the picture. Durstine had his own advertising agency in New York, where he formerly was the Number 3 man in the famous Batten, Barton, Durstine and Osborn organization, and became one of advertising's immortals through handling of the Serutan account, one of the first to use the device of spelling something backwards.
Durstine was brought in by John Jenkins, Tucker's friend on the Chicago Daily News, and with Durstine came Ellis J. Travers, former associate of Jenkins. Travers had been advertising manager of Nash at Kenosha, Wisconsin, in the early days when most of the auto companies were bursting with money. After more than fifteen years with Nash he went to Detroit with Ruthrauff and Ryan, national agency handling some of the Chrysler accounts. In the new Durstine setup Travers was vice president and manager of the Chicago office, and Jenkins, also a vice president, headed the publicity department.
But even with Durstine manning the guns there were still problems, because during what SEC calls the “incubation period”—from the time stock is registered until it is cleared for sale—no advertising is permitted. And even after the stock is cleared, the stock itself can't be advertised except through what the trade calls “tombstone” ads, restrained and dignified notices in newspaper financial sections, usually enclosed in heavy black rule like obituary notices.
There may be neophytes, inhabitants of the hushed inner temples of SEC in Philadelphia, who believe that stock is sold by this kind of advertising, but people experienced in business and finance—which includes the upper echelons of SEC—know that stock is sold just like any other commodity from toothpaste to foreign policy: by beating the drums and telling the public what a terrific bargain it is getting.
While SEC can't officially permit stock to be advertised, unofficially it takes a more realistic position, because without some kind of promotion very little stock would ever be sold and most new business would be dead before it even got started, and this eventually would put SEC out of business. So it permits advertising during a stock issue as long as the stock itself isn't advertised, thus getting around the law while technically observing it.
Theoretically SEC bans advertising “stressing the merits of the manufacturer's product” during the stock selling period, though how a manufacturer can advertise without stressing the merits of his product may seem a trifle obscure.
The fact is that few companies suspend advertising during a stock issue, and advertising their product can be expected to stimulate the sale of their stock. So the normal procedure would be to intensify advertising before and during an issue, and back it up with press releases and other forms of unpaid publicity, over which SEC doesn't have much control.
Appointment of Durstine was announced February 24, and shortly afterward he set up the Chicago operation in the traditional grand manner of any agency that takes on an important new account in a city where it doesn't have a branch office. Plush quarters were opened in the Civic Opera building and almost everybody except the office help was a vice president. More personnel was added, including copy writers, an art director and artists and another publicity man, and the mill was ready to start grinding.
Durstine went to work trying to repair Tucker's damaged reputation, and started national advertising with full-page ads the first week in March. The body for the Tin Goose was already well along, and with it and Tremulis sketches they finally had good art work for the first time. Copy in the ad told an exciting story.
“You'll get the motoring thrill of your life,” the ad said. “You'll find nothing you've experienced before will compare with the smooth surge of FLOWING POWER from the Tucker rear engine drive ... the new comfort of riding on the unique Tucker individual wheel suspension ... the feeling of security you have in driving a car so precisely balanced that it almost drives itself.”
After the heading “Here's the Success Story of America's most exciting Motor Car,” short paragraphs reviewed Tucker's background, describing the plant and listing top executives, and below was a picture of the car captioned: “THE NEW TUCKER...YEARS AHEAD!”
People close to the operation agreed that Durstine did a good job, considering the chronic state of crisis. About the only valid criticism was that on occasion he let Tucker get his neck out too far in some of the advertising, and perhaps encouraged him to spend too much money.
But it wasn't the usual situation of an agency scheduling an over-heavy advertising program to collect its 15 per cent, because for the time and work involved Durstine didn't make any great amount of money. Going overboard on shows and advertising could be credited largely to Travers, who always before had worked with companies which had plenty of money and could afford to do things in a big way. This technique had worked in the past and Travers depended on it to work again. He had been wiped out in the '29 crash, and he was trying for a comeback. Tucker looked like the answer, and he used every trick in his book to make Tucker's advertising pull its share of the weight.
Travers was thin, nervous and exacting. If he needed an artist, it had to be the highest priced artist he could find, and when they hired models they had to be off the top layer in the model agency's stable.
His action after taking over the account also was in the best tradition of big business and advertising. In a short time he had doubled-crossed everybody who had had a part in building Tucker up to where he was when Durstine came in. There was no particular malice in this, for Travers himself was rather a nice guy. It seemed rather that he had been operating that way so long he had forgotten there was any other way, and it had become a conditioned reflex.
Over the entire period with Tucker, Durstine scheduled around $800,000 in advertising, which wasn't excessive for the length of time involved. It can't be denied that much of the advertising was unnecessary, but whether the responsibility was Travers, Tucker's or a combination of the two was anybody's guess.
Since advertising had to be called off until the stock finished incubating, Durstine concentrated on the World Premiere which was scheduled for June 19. The Premiere had two purposes: to show the Tucker to dealers and distributors, who were clamoring to see the car they had put up money to handle, and to impress brokers who would be selling the stock.
The World Premiere also was timed to give the stock issue a healthy shot in the arm after the sale was well under way, which under the commission's normal twenty-day waiting period would be on or around March 26. So now all Tucker had to do was get ready for the Premiere and wait for the green light from SEC.