These are, indeed, the times that try mens’ souls.
Even for those of us who lived through the late 80s and other recessions, this one is particularly bad. GDP down 3.8% (a new record), job losses at an all-time, post-Depression high, and consumer confidence in tatters. Sheesh. Interestingly, the general reaction for brands seems to mirror that of the credit institutions—pull back and wait. At some point, the creditors will have to wake up and realize you can’t put your core business on the bench. Credit will flow again and the wheels will be put back on the economic machine.
The same is true for brands. While we can all understand belt-tightening as an internal reaction given the blood bath of the last quarter 2008, is 2009 really the time for brands to continue pulling an Ostrich? Is this really the time to spend less and spend only on traditional media models we know are less and less effective? I think not and I don’t think I am alone.
The CEOs of both P&G and Hershey have both weighed in with the observation that NOW is exactly the time to spend on marketing and branding. Noting that for the first time in recent memory ROI for marketing and ad spend may outpace cost, Hershey CEO, David West is bumping up media spend in 2009 by over 25%. Not only is this due to the raw numbers differential between cost and return, but the company sees the current market as an opportunity to grab market share and consumer loyalty while the competitors sit on the bench.
So now is the time to spend. But that is only half of it. Spend wisely. To us, that means put your money toward reaching your targets utilizing modern technologies and realities. The “lean back” audience is gone and brands need to reach the increasingly demanding and proactive “lean forwards” that will not be “sold”. There is a new equation / sheriff in town that says the target audience wants great content and brand message (value) delivered to them on demand and on their terms. The “hope we find them” traditional models just won’t work. What will work is a personal brand message delivered to them where, how, and when they want it. In the digital age, this means using online video, social networking, vertical passion centers and the like to get the consumer what they want at their time of want or need.
It’s all about media, branding and marketing spend that works in the new reality we live in. For a great summation of some specific, stop-gap measures, that will allow brands to ride out the worst of this as they embrace and shift toward this new equation and participant/brand paradigm, see Optimedia CEO, Antony Young’s list featured in a recent MediaPost.
So brands need to realize that the only thing they have to fear is spending itself. They must realize that smart spend to reach and converse with the new brand participants is the key to not only riding out this storm, but cost-effectively grabbing additional share and brand loyalty.
Peter J. Schankowitz