Ok, so it’s all bad news. Everyone is tightening their belts to try and survive this economic downturn. Lets look at the recipe for this problem: first, take several years of economic growth whipped into a froth with hyper-inflated real estate values; combine with sub-prime lending to over-extended people; add a handful of greed; mix that with an extraordinary election year; fold in “the war” that brims with uncertainty, and top with the annoying fluctuation of gas prices…. and ding! The media has a menu full of doom-and-gloom stories they force-feed to the public through every available media channel.
Those of us who live and breath the world of advertising, branding and design, have much to think about. Why should we care about brands in times like these? Because it’s during these times of recession that businesses can have the highest level of vulnerability and opportunity. Those responsible for shaping and maintaining a brand have much more influence over whether the current news climate weakens or strengthens their brand than they may realize.
It’s natural to be more motivated by the fear of what we might lose than what we have to gain - that is true of many business owners, executives and managers. The potential risk of loss creates a fight-or-flight reaction, which can lead to extremely unproductive decisions. It’s very important that they examine themselves during these times of recession, because what our brains perceives as a threat may actually be an opportunity. Authenticity and integrity will make the difference between whether a brand is vulnerable or getting stronger.
When I am confronted by companies that want to decrease their advertising during times of transition, I am reminded of something I read in Ogilvy On Advertising by marketing guru David Ogilvy. One of his favorite stories illustrates a very relevant point. David Ogilvy and a friend , Mr. Wrigley, were on a train journey to California. Ogilvy asked Wrigley that why with a lion’s share of the market, he continued to advertise his chewing gum. “How fast do you think this train is going?” asked Wrigley. “I would say about 90 miles an hour.” “Well,” said Wrigley, “do you suggest we unhitch the engine?”
Sadly, marketing budgets are usually one of the first things slashed. Marketers worry about spending, but don’t consider the long-term ramifications of their decision. Budget slashing creates brand vulnerability - a by-product of fear. The higher the fear-factor among company decision makers, the more likely that a brand will separate people and companies from their internal principles. When people are unclear about the core identity of their brand the brand is weakened. This natural inclination to react quickly to market changes can easily tip into over-reaction. This can lead to loss of market share.
Consider the opportunity that recession brings. Whether an individual or a corporation, knowing who they are should guide what they should do. Confidence comes from knowing your values and sticking to them. Uncertainty brings tests that are often difficult to foresee, but organizations that commit to being aware of their identity can make it through challenging times.
It is important to note that if an organization continues to proactively market in this environment, it can gain leverage. Organizations that enter a recession with a strategic emphasis on marketing can potentially come out of a recession ahead of the game. The marketers who perceive the recession as an opportunity can capitalize on it quickly.
A recession creates a unique environment that makes aggressive marketing even more successful. As short-sighted marketers decrease their advertising, there will be less “clutter” in the short term for marketers with vision to compete with. Consumers will be easier to reach. As spending decreases and people increase the amount of time they stay home, they will increase their consumption of media such as newspapers, magazines and television.
Proactive marketing sends a message to customers that the organization is confident even during hard times. The credibility that public relations efforts adds is perfectly suited to slowing economic times. As the economy gets better, organizations will once again start actively marketing, but the ones that continued to market during economic downturns will have a competitive advantage over those that are playing catch-up.
Napoleon once said, “The role of the leader is to define your reality and give hope.” Defining your reality starts with a deep understanding of who you are and your relationship to your audience. During these times when the media is fueling the fire of fear, fear not. If you know your brand values you will continue to act and make decisions from your brand center and be less tempted to sway when the media says the sky is falling. If you find that the heart rate of your culture is racing, do a gut check and ask yourself: are you reacting to the world of hype around you, or are you acting from the best interest of your brand?