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On June 9th of this year, I posted a note to this blog on being a Marketing Contrarian. This was in response to economic signs and how historically marketers have reacted to downturns. I must admit that when the global economy really got hit this autumn, I had not been so clairvoyant to see the extent, depth and pace of the impact. It did prompt us at DDB to write a paper called Capturing Opportunities in Challenging Times covering in detail marketing and advertising in a recession (available for download from this site). The response to the paper has been overwhelming. Readers have enjoyed the papers four main sections: cut versus invest, brands as long-term assets, consumer price/value equation, and steps to take when managing brands in a downturn. One comment among many received was from a Vice-President of Marketing at a consumer products company, who shared, "This is my second recession and the primary lesson I have from the first one is to think of my business as a hot dog stand – view it as a much simpler business. Do I react by selling lower quality hot dogs, cut back on condiments, stop smiling and chatting with customers, raise or lower prices willy nilly, take away napkins? No I do not. I leverage equities I have built up over time, be prudent in my own purchasing and other processes, and offer value, value, value."
Jeff Swystun, Chief Communications Officer, DDB Worldwide
This page contains a single entry from the blog posted on December 1, 2008 9:51 PM.
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Comments (11)
A Clark
I agree that value is the pivot point now. But what do we do when consumers only react to price and are willing to sacrifice quality and service? The news is so scary that I think we will soon be talking about Maslow's Hierarchy only as wants will totally disappear. Thanks for the great paper.
Posted by A Clark | December 2, 2008 3:12 PM
Steve H
I read DDB's recession paper with great interest. one point I would like to make is this recession is actually great for our society. Do we really need all this stuff we have built up over the last 20 years - designer outfits for pets, expectation that we can all visit spas all the time, therapy for entertainment instead of real need. My pastor said in his sermon last Sunday "how much more material goods do you need? When you cannot pull one car into your three car garage dont you think you have enough?"
Posted by Steve H | December 2, 2008 3:17 PM
Alice Doehner
Where were all the economists? How could the US be in a recession for a year without us knowing? How could bankers loan those without the juice to make their payments? How could consumers use their homes at personal ATMs? No one is innocent.
Posted by Alice Doehner | December 3, 2008 11:05 PM
James "Jimbo" Evans
Looks like this may last until mid-2009, which would surpass the downturns of 1973-75 (16 months) and 1981-82 (16 months). In our industry, AdAge says employment has dropped by 52,000 since hitting its peak in November 2007. Any bets on how many more jobs will go?
Posted by James "Jimbo" Evans | December 3, 2008 11:09 PM
Eric Von Lesbander
Anyone worried that consumers will not miss the advertising that gets cut because of the recession. This may prove once and for all that AD ROI does not truly exist.
Posted by Eric Von Lesbander | December 3, 2008 11:12 PM
J Conwell
We are entering an exciting cycle. All the talented people cut from big companies will innovate new small businesses. Their low cost structures and innovative offers will attract revenue. Consumer confidence will begin to rebound. Those small businesses will grow and so will the economy. Some will go public. And hopefully, just hopefully, we will remember that obsessive, disgusting greed is not good.
Posted by J Conwell | December 3, 2008 11:15 PM
Randy Crane
Advertisers are going to be asking for alot more proof that what they are paying for works. Digital and direct are going to do alright in 2009 because they have the measurement systems. If you are in charge of a brand are you going to advocate for a national 30 second television ad no matter how much media drops in cost? Budget is going to dictate strategy more than ever.
Posted by Randy Crane | December 3, 2008 11:20 PM
Karen H
There seems to be a strange disconnect out there. I live in London and whilst the news is overwhelmingly negative some habits seem inured to change. I still see people with shopping bags (I recognise it is close to the holidays), visiting Starbucks and Pret (both horribly over priced), and dining out with frequency.
Posted by Karen H | December 4, 2008 3:17 PM
Jakob Zurowski
Mr. Swystun, your paper has made key assumptions including that this will remain only a recession. A depression will make marketing obsolete. But a fine work, my best to you and your colleagues at DDB.
Posted by Jakob Zurowski | December 14, 2008 1:39 PM
Alexander Montanus
Dear mr. Swystun. What an excellent blog to get informed about the thinking of intelligent and smart people nowaday's when there's some crisis over there. How narrow minded, because there's always a chance instead of peril. I used to be the strategy director for DDB Amsterdam from 1989 till 1993. In fact, the agency positioned me as the first strategy director in the Netherlands under the inspiring leadership of mr. Lucas Mees. Ask mr K Reinhardt who was keen for international cooperation with us. We gave DDB (Europe) all the Awards there were to win, such as Cannes Lions for Centraal Beheer (yes, we started this advertising cycle with a Boom), Dommelsch Beer, Volkswagen and won all further available Awards in Europe, the Netherlands and USA. Let's talk. Kind regards, Alexander Montanus
Posted by Alexander Montanus | January 15, 2009 12:03 PM
Alexander Montanus
Dear mr. Swystun. What an excellent blog to get informed about the thinking of intelligent and smart people nowaday's when there's some crisis over there. How narrow minded, because there's always a chance instead of peril. I used to be the strategy director for DDB Amsterdam from 1989 till 1993. In fact, the agency positioned me as the first strategy director in the Netherlands under the inspiring leadership of mr. Lucas Mees. Ask mr K Reinhardt who was keen for international cooperation with us. We gave DDB (Europe) all the Awards there were to win, such as Cannes Lions for Centraal Beheer (yes, we started this advertising cycle with a Boom), Dommelsch Beer, Volkswagen and won all further available Awards in Europe, the Netherlands and USA. Let's talk. Kind regards, Alexander Montanus
Posted by Alexander Montanus | January 15, 2009 12:04 PM