(Recession Marketing 2.0)
by Martin E. Thoma
<< Part One: RECESSION LOOMS: INCREASE YOUR MARKETING BUDGET! <<
Let’s assume you absorbed my last article—“Recession Looms: Time to Increase Your Marketing Budget”—and agree with me that now is the time to absolutely, positively hammer away with your marketing efforts.
You know that history is on your side—that aggressively marketing through an economic downturn is irrefutably the way to grab market share. (And maybe even cause some real pain for your competition, if you think that way!)
So what now? What tactics or approaches might you deploy given the changing economic climate and consumer psychology? Is there anything about a down market that recommends a shift in strategy or tactics? The answer is yes—whether you have a smaller, equal or more generous budget to invest.
Let’s explore some characteristics of recessionary psychology and what you can do about them.
1. FUD. Fear, uncertainty and doubt tend to pervade the public consciousness during down markets. Your strategy must be not to participate. Humans sniff out fear as easily as dogs and horses do. Exude confidence!
We have several clients in one sector or another of real estate—the epicenter of the current economic malaise, what with the subprime mortgage meltdown and its ripple effects. For reasons ranging from opportunism to self-defense, these clients have accepted our advice to stay the course. They have swallowed their own apprehension and telegraphed their own confidence that whatever the market is today, it will turn up again after it reaches bottom.
Their results this spring: growing market share for one, and a good kick-start to sales for the other (sales that continue to accelerate each week—now that’s confidence-inspiring for everyone).
So put on your game face, keep up your own confidence in your team and your business, and do everything possible to infect everyone around you with the same. You’re no Pollyanna; you’re just a smart, focused business person.
2. Deafening silence (sort of). Twenty years ago as I stood on the Mustang Plateau in northern Nepal, looking further north into Tibet, my ears rang from the silence. In our market-driven economy, you’re never going to experience that, but in a downturn, the noise level certainly subsides.
This is your opportunity to grab share of voice. None of our clients have the largest marketing budgets in their space. As bigger, richer marketers pull in their horns, it’s an opportunity to increase mindshare, visibility and credibility for your position in the market.
Find and exploit every opportunity to be better seen—from civic and networking functions to news media mentions to ad placements.
3. Softer market, hungrier vendors. Softening markets create hungry suppliers. Especially in the media, but also in printing, broadcast production, web development and elsewhere. Do you have projects you’ve wanted to complete but couldn’t adequately fund them? Now is the time to shop them again and negotiate like T. Boone Pickens.
Regarding media—consider the perfect storm that growing unsold inventory, retreating advertisers and investor pressure place on your favorite media outlets. We have negotiated extraordinary packages with key media outlets during downturns; they need your media spend now more than ever. A recession is not only the opportunity to extract price concessions, but the chance to bundle up additional value-additions in your package and lock in long-term contracts.
Act now though, as the fall general election will create the opposite effect in media inventory—and the clamor of political advertising will cause consumers to tune out and turn off.
4. Rise of un-advertising. The advertising industry calls it “below-the-line”—basically everything that’s not easy-money television, broadcast or print advertising. Below-the-line expenditures include such activities as direct mail, direct response TV, online advertising and search marketing investments, sports/event marketing, product placements, promotions and so forth. The irony is that below the line investments now outstrip traditional media placements by something like 60% to 40%.
Registering even below below-the-line are activities that have been called variously: guerilla, stealth, ambush, buzz, viral, grassroots, wildfire and ambient marketing. These are intrusive, place-based or word-of-mouth driven campaigns that get under your skin and defy being tuned out. Pick up a copy of “Advertising is dead. Long live advertising” by Tom Himpe for a fantastic review of unconventional campaigns from throughout the world.
We deployed such a campaign recently for a real estate developer – employing static clings placed on doors, windows and mirrors; cutouts of local personalities; sidewalk-chalked ads and restaurant/retailer tie-ins, we drove web site traffic to more than 4,000 hits during the first two weeks. The campaign—which was complemented by traditional media advertising—drove numerous leads to the sales team and catalyzed a burst of new condo sales. Further, restaurants in the neighborhood have credited the campaign with increasing THEIR business too—a brand-building lagniappe for our developer clients.
You should be utilizing such “un-advertising” tactics even in the best of times. In the worst of times, they make your marketing dollars go that much farther.
5. Partner, co-promote and co-brand. Which brings us to another great strategy. Use the downtime to seek out and craft smart co-marketing relationships with natural allies. You should be doing this anyway, but the environment makes everybody hungrier and will open doors with prospective partners that might otherwise be too busy to pay attention. With our help, our home lending client has been able to pitch co-promotions to the local cable operator, real estate developers, an HVAC provider and bottled water delivery company. Not every overture leads to a new program, but he’s out there getting exposure and landing strategic relationships that will serve him well not only now but when the market accelerates.
6. The silence of the lambs. The quietude of a recession extends not only to advertising media but to earned media as well. Through the subprime mortgage meltdown, we have continued to place a mortgage client in the news columns and on the TV talk-format shows. Interestingly enough, the audience most impacted by the presence is area Realtors—a huge source of referrals for his mortgage bank. Realtors have told our client they appreciated their “voice of reason” among a flock of Chicken Littles. When the housing market turns north and those Realtors have more closings to steer, where do you suppose they’ll send them?
7. Get it online. The rise of online social networks, the blogosphere and cheap alternative new media are trends that smart marketers are jumping into with both feet. If you’re not already learning, experimenting and developing this piece of your marketing play, you’re already behind the curve. In a period of tight resources, the effort is even more imperative. This is the time to “lift some weights” with online and evaluate where you can get the most traction.
The Wall Street Journal recently featured successful approaches to bloggers by several companies. They tightly customized their pitches, sent sample product or personalized postcards—and broke through to nice coverage from these bloggers. For one company, sales jumped 500%.
8. Time on your hands. It’s possible that you’ll find some extra time on your hands during a down market—in spite of all the great ideas I’ve provided here. We certainly did during the post-9/11 downturn. Unwilling to gut our staff when business lightened up (we wanted to have full capabilities when the clouds cleared) we utilized the period to retool our entire sales support system, renovate our web site, build several new proprietary consulting products and systematize the others. We increased training of our staff and sought to further drive a wedge of differentiation between our firm and every ad agency down the street. It worked; our business development capability emerged stronger than ever.
If you have any excess capacity during the downturn, put it to good use revisiting strategy, fine-tuning positioning, developing or tweaking products.
9. Listen harder. Economic downdrafts can play havoc with consumer and business psychology. Regardless how good a game-face you keep on, your customers’ mindsets will be all over the map. One of our favorite mantras is, “let your customers be your consultants.” Now is the time to listen harder than ever.
Customer surveys, performance scorecards, focus groups or focus conversations, market intelligence studies—any and all of these techniques can be deployed to keep your finger on the pulse of the market. Here’s a short list of effective strategies conducted during the 1991 recession by national consumer marketers who were listening hard and retooling to stay relevant:
• A-1 Steak Sauce telegraphed that “A-1 isn’t just for sirloin anymore,” recognizing that many households would be trading down to Salisbury steak as they tightened their belts.
• Dow, maker of Ziploc storage bags, shifted funds to introduce a new line of freezer bags that would protect the freshness of leftovers.
• Quaker Oats capitalized on two recession-proofing efforts. First, it reversed a long-term sales slide by emphasizing that its grain products were a cheap source of protein. In addition, spokesperson Wilfred Brimley emphasized that an oatmeal breakfast cost only “a nickel and four pennies.” The company pushed resources behind the campaign and stoked sales.
• Wendy’s met the recession head-on with: “Look, I know you have less to spend these days, but that doesn’t mean you have to eat less.”
• Ikea pursued a similar theme: “Sure the country’s going through a recession. That doesn’t mean you have to.” It worked.
Listening closely to your customers can help you fine-tune your approach and positioning in such a way that you maintain relevance and enhance trust.
Maybe it’s a recession, maybe it’s not. But the headlines are full of doom-and-gloom every day, gas prices are going crazy, housing starts are in the tank. Whatever the economists call it, I call it a great time to outperform. Let’s get out there and hammer the competition!
>> Part Three: THE MOST IMPORTANT BUSINESS TO MANAGE NOW: YOUR HEAD! >>
Martin Thoma is a principal with Thoma Thoma, a brand growth and marketing firm serving clients throughout the United States. He is co-creator of The Brand Navigator System, a comprehensive program for discerning, defining and articulating brand power. Reach him at firstname.lastname@example.org or Skype martinethoma.
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Status: 01. Juli 2015