It links to the economy because people are less likely to be spending on flashy things and more likely to be thinking practically and pragmatically. Certainly people are going to be spending less in this down turn, but they will spend something.
Advertisers should approach the ‘R-word’ (recession) with extreme caution. Along with this economic downturn comes a lot of emotional response, such as anxiety. It is characterized by a sense that you lack control that you don’t know what’s coming and you are at the whim of circumstance.
To the extent that advertisers feel their clients or consumers are experiencing anxiety ads should try to empower consumers and help them think of ways to be in control in a world where they feel out of control. The Gold’s Gym spots address this concern, “you can’t control the economy but you can control how many pushups you do, and take control where you can, and we can help you”. That’s a powerful message.
Value is another important message to build into marketing campaigns during a downturn. Many marketers design communications aimed at justifying the price they charge for goods and services, either by emphasizing a low price or touting the benefits the company can provide to buyers. Advertisers can do both. Some are in a better position to talk about lower costs while others will have to focus on what you get for your money.
Luxury businesses should take a completely different approach, appealing more to emotion, emphasizing the need for some emotional release or comfort in difficult times. High-end advertisers will also attempt to emphasize long-term value such as suggesting that a watch is not just a purchase for today, but for years to come. You can try to remind people that this is, hopefully, a temporary state of things and we should not be focusing on the immediate future but also longer-term.
A brand-building agency that is part of the global marketing firm, the WPP Group, advises advertisers in a downturn to rally to protect and preserve brand equity that has been nurtured for years, with continued investment in and support of branded products. The worst thing you can do is cheap-out on products put less coffee in the cappuccino as many have in the past.
While price is important in a recession, the majority of price driven consumers still factor in the importance of branding.
Companies must maintain “good housekeeping” during a recession, such as product quality and good distribution systems, but that clear brand association and leadership comes through communication. If you cut the communication, you have a major problem. Marketers must make sure they understand the “elasticity” of their brand, which would be a gauge of how much or how little advertising is necessary to sustain sales. It is not a science. There’s a lot of art there, but you must be supporting your product.
In today’s networked, digital marketplace, consumer buzz about disappointments with a product can spread quickly and widely. You must give people good things to talk about by continuing to have good products and communication. The biggest lesson is that recessions come and go, but hopefully your brand is for life. It’s forever. So you have to be careful how you react because the downturn is not going to be forever.
If companies cut deeply into advertising and communications in a down period, the cost to regain share of voice in the market once the economy turns around may cost four or five times as much as the cuts saved.
You must really keep a balance in times like this. Do not go dark when customers and consumers need you because they need you as much as you need them.