In the press - Opinions and press coverage
Dear Prudence, can you come out to play?
17th October, 2008
There is something of a conundrum about reducing marketing spend during recession and the consequences on upturn. Cuts look worthwhile as marketing generally is less effective in a downturn. But then there is the loss of market share to those who didn't make the reduction as the market recovers.
The old adage (possibly slightly tired, but relevant given the parallels between today's recession and the Great Depression) that advertising through recession can make brands, is predicated on brute force rather than prudence. It worked for Coca-Cola. The idea that prudence may actually not be possible if marketers have been operating prudently already (so lean there's no fat left to trim) seems to play along with this notion.
When the credit crunch bit hard this summer, and the banks pulled mortgages, Abbey (and later Nationwide) gained market share by advertising stuff the others had prudently stopped marketing. I think real prudence comes through picking your battles. I believe that simply carrying on is just as bad as simply reducing budgets.
The best clients are focusing on marketing that's more or less recession-proof. Pick through all the digital activities clients commission and - rather than trying to find those that make the most instant money or have the greatest brand impact - look at services that will maintain brand awareness while big ticket advertising is being culled as a luxury.
Look at activities that encourage loyalty. Seek out ways to get more business out of existing relationships - referrals and advocacy. Find ways of adding value through extending product value, with incremental sales built in. Finally, find a way of communicating at precisely the right time to keep the relationship cantering along at the right pace.
OK, lots of desirables, probably mostly entirely common sense (and marketing is after all nothing but applied advanced common sense). I have a confession. My agency does digital relationship marketing, so the above inevitably comes with a bias towards digital, partly because it's quick and partly because it's cheap.
But to be honest, we've borrowed heavily from CRM, simply adding an 'e' to reduce production time and excise print costs. It relies on great data, phenomenal planning and good creative, as much as it does on managing technologically-complicated suppliers. Ultimately, it's about sending the right message to the right person at the right time. The more granular it is the better, obviously. If you can make it one-to-one (and online you can) then it becomes a highly targeted affair.
What I see some clients doing well as we all march heads high into the unknown is picking their battles. They engage their customers as individuals, following study of their habits and needs. It's a bit like having spies all over the place (and now I know I'm murdering the metaphor) but you know what I mean.
Having intelligence means you can reduce wastage. So while I believe there's no need to reduce spend across the board in these tighter times, I also believe we can market through recession quite successfully. I think there is, after all, a solution to the conundrum.
Felix Velarde, Precision Marketing