It’s quiet on the local high street. Too damned quiet. The cash tills of the world’s greatest shopping streets – Oxford Street in London, Fifth Avenue in New York and Corso Vittorio Emanuele II in Milan – are eerily silent. Even the peep of approved contactless cards is a memory. It’s as though the credits are about to roll on the latest Zombie Apocalypse Netflix stream-buster…
But it’s real. A social and economic horror show. The numbers suggest we face a financial crisis as deep as the Great Depression. Brands are having to make incredibly tough decisions. And those poor souls staggering along with their arms outstretched are not the undead, but armies of marketeers whose dreams of an easy life have just died.
After all, when demand slumps and revenues drop it is inevitable that costs are scrutinised. The marketing spend suddenly faces a potential drop in ROI. Conclusion? Cut unessential spending and save the dosh for the upturn. It’s easy but, according to Tom Peters, the American marketing guru, a very big and easy mistake to make. “Keep your mitts off the ad budget!” is his counter-intuitive pearl of wisdom for navigating a recession.
“Talk about shortsighted!,” he wrote in 1990 after the US had experienced a relative economic blip. “We’ve entered an age dominated by intangibles (perceived quality, design, service, etc.) and bare-knuckled competition. Maintaining or enhancing the ‘brand’ has never been so important, for the small or large company, in consumer or commercial goods or service. Remembering this during a downturn gains you a long leg up when good times return.”
And Peters had a point. Kraft Salad Dressing increased its advertising and enjoyed a sales growth of 70 per cent, according to a MarketSense survey of the 1989-91 recession. Most beer brands cut budgets, but Coors Light and Bud Light boosted theirs and sales jumped 15 and 16 percent respectively. “The best strategy for coping with a recession is balanced exploitation of ad spending for long-term consumer motivation, plus promotion for short term sales boosts,” the report concluded.
The need to keep advertising is not proved solely by a few anecdotes. Serious research began in the 1920s as the US emerged from the Great Depression. In 1924 Roland Vaile, a young and ambitious Californian who was fascinated by advertising, wrote a dissertation for his Harvard Masters, which was later published in the Harvard Business Review and entered advertising folklore.
The study charted 250 post American companies as they battled through the economic hangover of the First World War and then enjoyed – if they survived – the recovery. He looked at their advertising spends and then split the companies into three groups – non advertisers, those that cut advertising during the Depression, and those that increased it. Then he compared their annual revenues.
You guessed it. Companies that spent more during the hard times increased sales much faster than their rivals during the downturn and, vitally, into the growth period. Those that pared back advertising suffered a fall in sales falls during the recession and for the following three years. Intriguingly, they performed worse than the non advertisers! Vaile had an eye for his craft. He would later write the iconic book Marketing in the American Economy with fellow marketing expert Reavis Cox.
See the light. Don’t go dark
The key is to get across your brand message in a sensitive and relevant way. It is time to be more timely than ever, to really consider what part of your brand philosophy or proposition should be emphasised. Don’t ditch the content marketing strategy. Re-evaluate it and make it sing in a supportive and elegant way.
More and more people are searching for news updates, engaging with social media and maximising tools such as LinkedIn than ever before. If there has ever been a time to have a strong digital presence, it’s now. Ensure you understand where and what channels your target audiences are currently engaging with, and maximise marketing spend in these core areas. Here are three brands and three story types:
Cottonelle – address customer concerns
Stores started to sell out of toilet paper, which had bizarrely become the world’s most must-have item, so one of the world’s largest toilet paper producers delivered a clear message on YouTube to try and encourage consumers to stop panic buying. “Stock up on generosity,” was the message.
The brand also promised to donate $1m and a million rolls of toilet paper to United Way Worldwide’s COVID-19 Community Response and Recovery Fund.
Walgreens – be part of the solution
The huge pharmacy used its position as a trusted leader in health care to support anxious consumers and, in doing so, support its own position as a, well, trusted leader in health care. It did so by adapting its Ask a Pharmacist series into videos answering questions about COVID-19, such as “What does it mean to be quarantined?”. The brand rapidly converted an existing email campaign creative into a video ad to explain how people can safely take advantage of online care services and free prescription delivery. It also set up drive-through testing for first responders.
Guinness – Bring people together and create communities
St. Patrick’s Day – a highlight of the year for Guinness – vanished as a brilliant and raucous social gathering. No lock-in. Just a lock down. So the brand understood that everyone needed a positive message about community and the good things of life. Raise up a glass at home, was the message, and help to raise up each other. We’re all in this together. The Happy St Patrick’s Day message was pieced together using existing footage in a matter of days.
All the companies that adapt and bravely hold their nerve should reap their rewards. “The reason the recession is such a fertile place to grow market share has nothing to do with the downturn itself or its impact on consumers,” explains Mark Ritson, a business consultant and columnist at Marketing Week. “It’s because competitors pull back and you – hopefully – do not. When Sam Walton, the legendarily savvy founder of Walmart, was asked about the 1990 recession, his reply encapsulates best practice recessionary marketing: ‘I thought about it and decided not to take part.’”
At Paragon we enjoy the challenge of creating content marketing strategies, of telling corporate stories in a fresh and compelling way. If you would like to talk to us about updating or refreshing your strategy, then we would love to help you. Why not contact our team.
Tags: Budgeting, Business Tips, Case Studies, COVID19, Marketing, Strategy