The Jolt: Recession Marketing 101 - Relevance & Empathy
Marketing in a recession, an opportunity or a curse? Frankly it's both.
We have seen this all before - the economy grinds to a halt, consumers rush for generic brands they once ignored, customer service suddenly improves and the same predicament hits agencies and clients alike: how do we market in these economic conditions?
The adage, no brand, no demand undergoes a severe test and the outcome is inconclusive, or is it? Do generic brands do better in recessions or is it that established brand don't do enough to respond to the current climate?
As clients tighten their belt and take a wait and see approach on the economy, agencies likewise do the same. It's not a good scenario but an understandable one. In truth, there are some folks who see the recession as an opportunity and leverage it. The opportunity is to provide some relief to the negativity, to acknowledge the reality that its a recession but it does not have to be miserable. Like big ships most clients are slow to react, instead taking the conservative approach to recession marketing.
Others, with help from their agency partners have watched the market and have identified the opportunity, and have jumped right in. Take ANZ, they saw what was going on and crafted a campaign about maximizing how hard your plastic can work for you.
Others still realize that not only does their messaging strategy have to change, so to must they maximize their channel strategy. With e-comms growing twice as fast as brick and mortar, its a no-brainer that it's the place to be - but you have to be relevant, the message has to make sense. Too often it's a channel strategy without a reason to believe.
New York city offers the recession lunch special, stores offer the recession rations, Wall Mart offers bigger better discounts (value).
So can brands survive the recession? Of course but they can't go on as if its business as usual. They have to focus clearly on relevance.
In a recession, relevance becomes a key driver. All things being equal, let's assume your brand is sufficiently differentiated - people know about it, it's sufficiently known and regarded. In a recession, when value suddenly increases as a measure, consumers will spend more time assessing branded product X versus un-branded product Y. What's going to make the difference? Price? Well, it'll have a bigger role to play, but let's assume we're a commodity. Now what? Relevance now plays a greater role. If the brand offers some relevant value, it will connect with the consumer - beyond price.
The marketing mix requires many minor alterations but none more than understanding what the consumer wants and needs and how to provide that to them. Discounts will draw folks in, generic brand will have a magnetic effect if brands do nothing.
The brand equity must now earn its reputation, demonstrate its value as a higher priced product, and thus it must be relevant, and in so being differentiate itself further. Everyone is doing discounts, it's a short term commodity strategy.
Challenger brands have figured this out long ago, and we should dust off an example to help illustrate my point. Look at Avis back in the day with their - "We try harder" campaign. A genius campaign in good times, a better campaign in tough times. They understood that what consumers wanted was service, you can rent a car anywhere - same cars, price etc - what's the relevant differentiator? In this case, service, and they sure did "try harder" and it worked.
So what should you take away from this? Simple: listen to the environment, listen to the consumers and the market, find the opportunity and leverage simple, compelling and relevant ways to ease the load that we are all facing.
Being a marketer is about having enough empathy to understand what's going on and why. Why do generic brands do well in recessions? Because they are relevant. And ultimately the only way to survive the recession is to be relevant, and this applies to all of us, whether we're referring to a product, our jobs or ourselves (as brands).
Adrian Collard is vice president/business leader of regional marketing for MasterCard in Asia Pacific, the Middle East & Africa.
- MasterCard Worldwide
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