He was Earl “Madman” Muntz and today you’re in for a treat and a valuable business lesson from this very colorful businessman who made and lost 3-fortunes.
During The Great Depression, Earl dropped out of high school to help support his family. He sold used cars and at age 20 in 1934 he opened a car lot near his home in Elgin, Illinois; but because he was too young to sign contracts his mother had to sign them for him.
In the 1940’s Earl saw much bigger opportunities in car hungry Southern California and moved to Los Angeles. But how would Earl stand-out among all the other car dealers?
At first he struggled to find his way and then he met young marketing genius Mike Shore, a match of destiny as Mike would create a sales campaign that made Earl his 1st fortune.
Earl had told Mike, “He could do whatever he wanted. Just send me the bill.” said Judy ver Mehr, who with her husband Dan Bunker produced the 2005 documentary, “Madman Muntz: American Maverick.”
The sales campaign Mike created for Earl bombarded Los Angeles radio with clever car ads such as: “I wanna give ‘em away,” yelled a voice-over actor as “Madman” Muntz, “But Mrs. Muntz won’t let me -- SHE’S CRAZY!”
And later this ad also screamed by a voice-over actor: “I buy ‘em retail, sell ‘em wholesale – IT’S MORE FUN THAT WAY!”
People laughed and remembered these crazy “Mad Man” Muntz ads as they flocked to his car lot and bought his cars.
Slogans such as these were also plastered on billboards across L.A. But most people didn’t know what the “Madman” looked like so a cartoon image of him was created of a man with a crazy look in his eyes wearing a Napoleon style black cap and red underwear.
But that’s not all. Sometimes the “Madman” advertised a “SPECIAL OF THE DAY,” for a car with an irresistibly low price. But if you wanted it, you had to rush in and buy it that day or supposedly the “Madman” would smash it to bits with a sledgehammer.
His crazy ad campaigns became so popular, that comedians such as Jack Benny, Bob Hope and Red Skelton used them in comedy routines and “Madman” Muntz became more famous and sold even more cars.
And years later, retailers such Crazy Eddie in New York would use the “Madman” concept as they too claimed to be lunatics, compelling buyers to take advantage of their insanely low prices.
What Mike didn’t know “when he started the whole campaign – Earl had no money,” said Judy. “72 hours later the money started coming in and Earl had the money to pay Mike.” Fortunately for everyone involved, the campaign was instantly an enormous success.
Earl’s next fortune came at the end of the 1940’s when television exploded on the scene and the public rushed out to buy TV sets. But many of them couldn’t afford the high prices and credit was not commonly used at that time.
Earl jumped into the TV business making his own sets and slashing prices so most people could easily afford them. How? Earl had his engineers design the TVs and then he’d join with them and started taking parts out to see if the TVs still worked with fewer parts. By saving money on parts, he built TVs cheaply and his prices were so low his competitors thought he was crazy.
“ ‘TV in your home tonight,’ a slogan Mike came up with,” said Judy, was a tremendous success. “They would install the TV in your home and even put the aerial up on your roof,” she added. This was when most of Earl’s competitors couldn’t deliver immediately, and when their TV arrived, the buyer was on his own to install it.
Earl’s top year was 1952 when he sold $55-million worth of TVs from his 72-stores. And he used another clever sales tactic. He’d send out TV knobs with a note that read, “Call and we’ll show up with the rest of the set.”
But by 1956 the vast number of people owned TV sets and sales fell-off sharply. In 1957 Earl was bankrupt.
For the car business had gone sour as well. Before there was a Corvette, Earl had the foresight to produce a state-of-the-art American sports car, the Muntz Jet designed by Frank Kurtis, creator of several Indy 500 winners.
“My prices are so cheap,” the “Madman” claimed in his ads, “I’m losing money on every deal, but I’ll make it up in volume.”
Sadly he was right about losing money on every deal. In the early 1950’s a new Cadillac cost less than $4,000. A Muntz Jet sold for $5,500 and Earl found out it cost him $6,500 to make each one. Before closing the business, he produced 394 Muntz Jets, which are now collector’s items selling for as much as $75,000 when fully restored. But Earl lost a fortune on them.
In the 1960’s Earl bounced back nicely and made his 3rd fortune when he developed the Muntz Stereo-Pak, a four-track car stereo, which captured the market. He sold stereo cartridges as well and had the rights to about 75,000 songs. Years later Earl “was elected to the Electronics Hall of Fame as the founder of the car stereo industry,” said Judy.
Earl added more businesses such as big aluminum trailers he called, Muntz Motor Mansions, and he had Muntz Satellite Dishes and Muntz Giant Screen televisions, along with a motorcycle rental business. But none of these ventures did well, and Earl needed money.
Married and divorced seven times, and with a glamorous Hollywood lifestyle, Earl went broke.
But he was up to the challenge. At the end of his life in 1987, at the age of 73, he was making his 4th fortune as the top Los Angeles area seller of an exciting new electronic device, the cell phone.
Earl said he didn’t mind losing his fortunes because, “it was so damn much fun making another one.”
What valuable business lesson did Earl teach us? Dare to be different and try something new. It could make you legendary as it did him and it could make a lot of money for you. Earl had fun treating business as an adventure and so could you if you have the courage to act.