Marketing in a Down Economy IABC-KY Meeting, Louisville, KY July 12, 2012
Today’s Agenda• A historical perspective• Strong brand = consumer confidence• What can I do and can I afford it?• Using digital in a down economy
“You don’t ever want a crisis to go to waste; it’s an opportunity to do important things that you would otherwise avoid.” - Rahm Emmanuel Former White House Chief of Staff
Should You Advertise in a Down Market?• 1981-1982 Recession – Companies that maintained or increased their ad expenditures averaged significantly higher sales growth during that time and grew 256% for two years after• 1989-1991 Recession – Companies that increased ad expenditures experienced growth from 15-70% – Companies that cut back on advertising during that time had a drop in sales from 26-64%* *McGraw-Hill’s Research of 600 companies between 1981-82 and 1989-91
How Does a Recession Impact Consumer Behavior?• Decrease in overall spending – 80-90% willing to trade off or trade down – May not return to previous spending habits• Change in lifestyle and how they spend their time – Staying home – Focus on home and family• Focus on products and services that provide a “rational benefit” – Running shoes? Yes – Jimmy Choo’s? No• Consumers, manufacturers & retailers in a “no frills” mood – Emphasize value (quality divided by price) and how those savings will benefit them and their family
Recession Spending• Increased spending only likely to be in: – Online – Mobile – In-home entertainment sectors• Consumers want reassurances about their spending in bad economic times – Anxious about keeping job, paying the mortgage, college tuition, etc. – I’m making the right decision with the money I have – Consistency and authenticity are critical
Success Stories– Every Day Low Prices launched in 2000-2001– Positioned as more than just low prices, but making contributions to consumers lives– Consumers staying at home more– Brand promise = “you can have a superior cooking experience and you can share this with your friends in a superior way”
Reasons to Stay the Course1. Today’s consumer has to be motivated to action. Replace consumer anxiety with empowerment.2. Go after or protect market share. It’s less expensive than trying to rebuild it later and studies show it leads to long- term profitability.3. Increase share of voice and top-of-mind awareness. Less aggressive advertisers leave the door open to consumer brand switching.
Reasons to Stay the Course4. Great media values are out there. Advertising is still a viable and important communications vehicle. Purchase “opportunistically” but don’t sacrifice frequency.5. The economy will improve. Staying engaged with your consumers during the recession enables you to optimize performance now and to accelerate into the recovery.
Strategies for Thriving in a Down Economy• Focus on the Future – Since 1854 there have been 28 recessions – Average recession has lasted 10 months – Position your product or service as bringing value to the consumer (don’t focus on the “bad times”) In other words, the economy WILL recover
Strategies for Thriving in a Down Economy• A strategic marketing plan is vital – Dont waste money communicating the wrong “message” in the wrong place to the “wrong” audience – Good time to review plans for continued relevance in current market• “Stick to your knitting” – This is not the time to stray from your known brand – But, do evaluate your brand identity and how relevant it is to your consumers in this market – Consumer research essential – Reinforce the positives, change the negatives
Strategies for Thriving in a Down Economy• Maintain your advertising budget – If possible, increase it (just don’t tell your CFO) and let the competition cut theirs – Increased ad spending = increased share of voice• Re-evaluate your media/dayparts/insertions mix – Changing a TV daypart can save you as much as 19% while only reducing your reach by about 9% – Increase time between flights/insertions – Eliminate weeks of media• Don’t sacrifice strategy and message – If you can’t run a full schedule, don’t water down your message
Strategies for Thriving in a Down Economy• Maintain continuity to sustain awareness – Consumers depend on brands they trust – Advertising works cumulatively, so we have to remind people frequently about our brand or theyll forget us – A strong brand is the best defense against a difficult economy• PR and non-paid media – Op-eds and pitched stories are more valuable – Newspapers are not ‘dead’, but their readership and how consumers access the product is shifting
We’re All in This Together• Recommit to customer excellence – Internalize your brand: your brand reputation depends on it – If you don’t already have a service excellence program, start one!• Remember your employees – They are also feeling the economic pinch – Work with HR to help them get through the hard times – This isn’t 100% altruistic – your employees are your best brand ambassadors
The Budget Rollercoaster 41% plan to reduce print 70% plan to64% plan to spending increase increase investment in budget for social media SEO (including blogs and product reviews on their site) http://www.6smarketing.com/infographic-digital-marketing-budget-trends-for-2012/ 21
Budgets May Not Be Growing But They Are Shifting 28% are moving some budget to digital channels http://www.6smarketing.com/infographic-digital-marketing-budget-trends-for-2012/ 22
Consumers Find You on Search Engines 20% of Google searches by month are for local businesses 46% of daily searches are for info on products or services SEO & SEM are important and worth the investment! http://www.6smarketing.com/infographic-digital-marketing-budget-trends-for-2012/ 23
Mobile Matters More Every Year In 2013: • There will be over 60 million smartphone users • U.S. companies will spend more than 2 million on mobile marketing (36% increase over 2012) • 80% of major U.S. brands will be using mobile marketing http://www.6smarketing.com/infographic-digital-marketing-budget-trends-for-2012/ 24
Low/Moderate Investments = High Leads Search investments (SEO and SEM (PPC)) create strong business leads % of digital budgetsSocial media ismaking big gainsas a leadgenerator http://www.6smarketing.com/infographic-digital-marketing-budget-trends-for-2012/
Digital Priorities Pyramid Site Refinement, Analytics & 60% Search Marketing (SEO & PPC)In 2013, U.S. Online Display Advertisingcompanies will 30% & Affiliate Partnersspend 21% ormore of their Email Marketingmarketing 5%budgets ondigital 3% Social Media Mobile & 2% Video Mkting Source: Forrester’s Interactive Models Research: Forecast for U.S. Interactive Marketing Spend 26
Tackling the Top 4 DigitalConcerns of Marketers 27
The Top 4 Digital Concerns During a Down Economy • I have a modest marketing budget or my Budget marketing budget is maxed.Monetary • I have already allocated 90% of my budget. I am afraid to move dollars from traditionalAllocation marketing to digital. Media & • I don’t know where to start with digital. There Medium are so many options. • I don’t have additional resources to take onResources new marketing efforts.
• Use free online marketing tools when possible. Your Budget investment is equal to the time it takes to set them up.Monetary • Reallocate 15 -25% to digital. Pull funds from low return investments and move them to 1 – 3 digital efforts.Allocation Media & • Do your homework. Search what’s working in businesses like yours. Not every digital option will be a good fit . Seek Medium guidance from digital marketing experts. • Devote approximately10-15 minutes of your time each business day to digital. It doesn’t have to be daily, but expectResources to spend one hour+ per week on digital. Hire an intern and pay him/her to help you run your digital program.
Website: Your Marketing Front LineChecklist: Have I had my website independently audited Have I tested usability on my website? in the last 12 months Is my website showing up in keyword Is my website professional and modern? searches? Have I compared my site to my competitors’ Is everything working properly on my site sites? Have I gotten rid of Flash elements? Can consumers easily reach me via phone, Do I know how my site looks on a variety of email, inquiry form, and physical address mobile phones? Am I immediately responsive to all inquires? Do I have strong customer testimonials Am I building my prospective and existing Have I included location-based apps or links to customer databases and collecting valuable location-based apps for easy downloading for information about them? my consumers? Am I talking about myself and my company on Is my site listed correctly on all of free my site or am I talking about what I can do for business listing sites? You may be listed and my consumer? do not know it. Is it hard to navigate? Are the images helping or hurting my brand? Is there too much text?
Emails and Eblasts: A MustChecklist: Do I really know what I need to know to be effective Have I encouraged my email recipients to pass along with my emails? the message or discount? Am I using a reliable and easy ESP (email service Have I included my social media resources? provider, i.e. iContact, Constant Contact)? Am I rewarding good customers with coupons, Is my email database clean discounts or special offers? Am I collecting consumer preferences? Does the imagery enhance the message or just make Am I following all SPAM and best practice email it look pretty? guidelines? Am I tracking my email campaigns? Am I correcting incorrect emails and reducing my Do I know the best days, time of day and frequencies bounce rate? to reach my audiences? Am I faithfully removing anyone who does not want to Have I purchased a list? receive my emails from my mailing lists? Do I have a mechanism to collect new emails Am I providing web page and text backups for all of addresses and contact information to expand my my emails? business’ database? Do I have a strong CTA (call to action)? Have I given Have I started collecting mobile phone numbers for them a reason to click? future texting campaigns? Is my email compelling? Have I built out an editorial schedule for my emails for Have I included all of my contact information in a text the next 6 months? format? Am I tracking my email campaigns and are my campaigns improving upon each refinement?
Social Media: You Need It But…Checklist: Have I given serious thought to my primary social media channel? Do I know what my competitors are doing? Do I have a formal LinkedIn profile? (Particularly important for B to B) Have I had my social media presence audited for value? Have I claimed my brand on all major channels? Have I educated myself and my team on how to use social media for business? Is my presence representing my brand to it’s fullest potential Am I aware and using new marketing tools available to me? Do I really understand what businesses do well advertising in these mediums and what do not? Have I built a social media strategy around my brand, products, services, seasonal advantages, pass along strategies, engaging my fan base, messaging voice and appropriate use of imagery? Have I received and acknowledged feedback from followers? Am I responsive? Am I tracking my social media placements, my competitors and my viral influence correctly? Are my fans engaged and participating in discussions? Is my page professional and well-designed Do I offer my fans special offers and discounts? Do I have compelling content? (Worth asking again… Do I REALLY have compelling content?) Is social media part of my public relations strategy?
% of Firms Using Social Media For Marketing Activities 37
SEO & SEM: Can They Find You?Checklist: Do I know all of my critical keywords and key phrases? Has my site been audited for SEO effectiveness? Do I show up on page one of my keyword/key phrase search? Do I use a regional strategy for my SEM? (If relevant) Are strong sites linking to mine? Do I encourage social media followers to visit my site? Do I track SEO and SEM via analytics? Have I done my homework? Do my team and I understand the fundamentals of SEO? If my search engine ranking is low, am I engaging SEM with a reputable specialist? Is my search marketing company making recommendations to improve my ranking and monitoring my SEM buys 24/7? Am I prepared to commit to a 12+ month engagement in SEM? Do I have a way to track leads from search engines and keyword searches? Is the abstract that surfaces based on a keyword/phrase search strong, clear and compelling? Have I made a compelling offer in my abstract? Am I taking search users to the correct pages on my site? Am I giving search users an easy but actionable and clickable result? Am I properly collecting searcher information when they land on my site?
Mobile Marketing: Yes, If…Checklist: Have I done my homework on the success rates of the online mobile marketing providers that I plan to use? (Trumpia, etc.) Does my consumer have a smartphone texting profile? Do they message frequently Are my competitors doing well with mobile? Does my online mobile marketing provider have strong ROI case studies? Are participants gaining revenue? Is my offer good enough to bring new consumers to my business? Is it as good or better than competitors? Am I able to collect and reuse consumer email addresses and mobile numbers so that I can send out offers directly? Have I prepared for business surges and planned accordingly? Do I have a follow up plan for participants who click through? Am I promoting my mobile campaign via my traditional and online marketing channels? Is this an opportunity for QR codes Am I tracking my spend to revenue ratio from the promotion? Do I have the right message and contact information with my incentive or coupon so that redemption is easy and trackable? Am I staying local and building in local relevance Have I reviewed my mobile display ads on a variety of smartphones?
Example: Marketing Channel EvaluationChannel Volume Cost/user Time to implement Mktg Effort Production EffortViral / Referral depends on CTA; size of accessible low/zero Low for FB social networks; low low/med social networks / # users med/hi for normal sitesEmail depends on CTA, size of your house low/med Low low/med low/med lists, email signups (med = create templates)Blogs / Depends on # blogs in your segment, low/med Low (if just you blogging); low/med low/zeroBloggers competitive scenario med (if youre setting up big CMS / (med = CMS, prof design) evangelizing to other bloggers)SEO depends on your keywords Low/zero Medium low/zero med/hi (depends on your search geeks)SEM depends on your keywords Depends Low/med Low/med low/med (depends on your marketing) (landing pages = med)Contest small unless big prize $ low/med low/med Med low/zero (don’t, keep it under $5K) (depends on contest, site, campaign) (med = prof contest site)Widget Depends on CTA; size of accessible low/med Low/med med med/hi (depends on sites, level of adoption + bloggers complexity)Domains depends on keywords, domain costs depends low low Low (redirects/co-brand?)PR depends on your business & audience Med/hi medium (develop story, build contacts) med low/zero & newsBiz Dev / depends on partner, size of customer Med-high med/hi (capture metrics, generate Med/hi med/hiPartner base, conversion reports) (reports, co-branding)Affiliate / Lead depends on economics Med/hi med/hi (need to build affiliate program, med/hi med/hi (depends on rqdGen capture metrics, generated reports) tracking & reporting)Direct / radio depends on geography Med/hi medium Med/hi low/zeroTelemktg depends on target demographics med-high med-high High low/zero if no system; Med/hi if integrated SFATV Potentially large (if you spend) High Med-high High Med/hi (production cost) disclaimer: these estimates of vol, cost/user, time & effort are highly subjective & very dependent on your specific business Source: www.slideshare.com/designing-marketing-plans-1195162412251922-2