So should we spend our way out of it as Chancellor Darling (and John Maynard Keynes before him) seems to be advocating or should we batten down the hatches and come back when it is all over (as Pete next to me in the office is advocating)?
Personally I am not sure either route is preferable. For one I don’t have any hatches and for two I can’t help thinking that the ‘spend now, pay it back later’ approach was the thing that got us into this pickle in the first place?
Anyway, clearly I am no economist so I will bring the question back to a marketing theme and ask: What should brands do in a downturn?
It is well documented that brands that increase advertising during a recession, when competitors are reigning in spend, can improve market share and return on investment at lower cost than during good economic times. But how should brands behave during such times? What messages should they take to consumers?
Well hopefully Xtreme will have part of the answer. A recent email informed me that they have put together a report that ‘explores and analyses recessionary marketing communications tactics and strategies from around the world’. I thought this seemed like a nice idea so we have ordered a copy.
In addition to generating them a sale, the Xtreme email did another job. It prompted me to recall a rather jarring brand experience I had had courtesy of Orange a day or so earlier.
I had flicked through 5 or 6 pages of press doom and gloom – Mumbai, house prices, the pound against the dollar, more failing retailers and another round of job cuts – when I logged onto Orange broadband at home.
The message on the home page read “How bad will it get?” with the usual ‘expert’ telling me it could undoubtedly get worse. Now I am not sure I want to see Orange jump on the back of the credit crunch band wagon. I expect it of Tesco. I expect it of Asda. But I want Orange to tell me it’s all going to be OK. That things are rosier than we might think. That the future is bright for gawd’s sake!
So what does my own reaction tell me? It tells me that marketers and agencies need to think twice when the idea of a credit crunch campaign falls hits the flip-chart. Credit crunch busting offers and promotions might drive penetration in the near term but we must question what the effect will be on the brand in the long term.
Brands are precious. They are for life not just the credit crunch. Be careful out there.
Personally I am not sure either route is preferable. For one I don’t have any hatches and for two I can’t help thinking that the ‘spend now, pay it back later’ approach was the thing that got us into this pickle in the first place?
Anyway, clearly I am no economist so I will bring the question back to a marketing theme and ask: What should brands do in a downturn?
It is well documented that brands that increase advertising during a recession, when competitors are reigning in spend, can improve market share and return on investment at lower cost than during good economic times. But how should brands behave during such times? What messages should they take to consumers?
Well hopefully Xtreme will have part of the answer. A recent email informed me that they have put together a report that ‘explores and analyses recessionary marketing communications tactics and strategies from around the world’. I thought this seemed like a nice idea so we have ordered a copy.
In addition to generating them a sale, the Xtreme email did another job. It prompted me to recall a rather jarring brand experience I had had courtesy of Orange a day or so earlier.
I had flicked through 5 or 6 pages of press doom and gloom – Mumbai, house prices, the pound against the dollar, more failing retailers and another round of job cuts – when I logged onto Orange broadband at home.
The message on the home page read “How bad will it get?” with the usual ‘expert’ telling me it could undoubtedly get worse. Now I am not sure I want to see Orange jump on the back of the credit crunch band wagon. I expect it of Tesco. I expect it of Asda. But I want Orange to tell me it’s all going to be OK. That things are rosier than we might think. That the future is bright for gawd’s sake!
So what does my own reaction tell me? It tells me that marketers and agencies need to think twice when the idea of a credit crunch campaign falls hits the flip-chart. Credit crunch busting offers and promotions might drive penetration in the near term but we must question what the effect will be on the brand in the long term.
Brands are precious. They are for life not just the credit crunch. Be careful out there.
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