JWT Anxiety Index Fall 2009


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JWT Anxiety Index Fall 2009

  2. 2. TOPLINE FINDINGS After a year spent surveying brand and consumer response to the recession through our AnxietyIndex.com, we found that only a handful of the 350 examples we collected across 24 countries truly stood out. Creating innovative work isn’t easy in any economic climate; it’s even harder when marketing budgets are low and risk aversion is high. Despite these challenges, some notable responses to the recession emerged this past year. Our AnxietyIndex Brand Hall of Fame salutes 10 of the best that we’ve seen—those that made us wish we had done it (and in two cases, we did). Among them are a brand that re-imagined a product, another that sold hope (literally) and another that leveraged the headlines of the day through a quick-turnaround campaign. We believe these will hold up in years to come as case studies of work that transcend typical approaches to a downturn. Our third AnxietyIndex Quarterly report lists these Top 10 in ascending order and explains why we think these are stand-out responses to the recession. About AnxietyIndex Quarterly During periods of heightened consumer anxiety, brands need real-time data that can help them navigate a rapidly changing landscape. They need answers to new questions and a point of view on the types of businesses and business practices that will emerge out of the crisis. JWT should know. At 145 years old, we have a proven track record of leading brands through pivotal times. We’ve done this by providing tools to help brands succeed. One such tool is our proprietary AnxietyIndex, launched during the run-up to the war in Iraq; it tracks the level and drivers of consumer anxiety and explores how these affect attitudes and behaviors. Earlier this year, we expanded upon our AnxietyIndex by debuting www.AnxietyIndex.com. With daily content updates and major research and trend reports added frequently, this interactive site is intended as a place to discover and discuss how brands and consumers are responding to and coping with the global recession. Last spring we launched our AnxietyIndex Quarterly. This third issue seeks to contextualize the AnxietyIndex.com content we have published over the course of the year. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 2
  3. 3. 10. AMERICAN EXPRESS Program: American Express OPEN Country: U.S. Why it’s one of the best: Through its OPEN card, American Express positioned itself as an ally of small-business owners both through word and actions. Description: In a campaign for its OPEN small-business platform, American Express praised small-business owners as “the most powerful force in the economy. They drive change. And they’ll relentlessly push their businesses to innovate and connect.” While the anthem spot was inspirational, what is truly powerful is the brand’s OPEN Forum, an online resource and social networking site for small businesses that features a virtual Rolodex of credentialed businesses, marketing toolkits and an idea hub, among other things. For the past few months, American Express has been pairing up with other organizations to support small businesses. Most recently, it linked with NBCU for the “Shine A Light” competition, in which one small-business owner won $100,000 in grant and marketing support for his or her company. Results: Openforum.com saw steady growth in traffic between September 2008 and September 2009, increasing from 68,005 unique visitors to 355,109. Most of this growth occurred between July and September this year after the official unveiling of the social network. During September 2009 alone, Openforum’s unique visitors spiked by nearly 20 percent. The “Shine A Light” competition received 4,000-plus entries. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 3
  4. 4. 9. CAIXA ECONÔMICA FEDERAL Program: Lottery Country: Brazil Why it’s one of the best: Caixa Econômica Federal reimagined one of its products to increase consumer confidence in credit during a crisis. Description: Brazil’s national bank, Caixa Econômica, invested in a promotion inspired by Brazilians’ faith in the luck of lotteries. Each purchase made with a bank credit card generated a coupon that could be raffled. The prize? The bank paid the credit card bill. This meant that the more often consumers spent, the more chances they had to win everything they’d bought. Betting on a game of faith valued by Brazilians, the bank offered people a chance to reduce their worries related to credit card bills. 8. WOOLWORTHS Program: We’re an Employer Country: Australia Why it’s one of the best: Woolworths tackled one of the primary sources of anxieties for Australians head on. Description: In April, our AnxietyIndex showed that Australians were more pessimistic about unemployment than a series of other potentially troubling factors, such as cost of living, crime and the state of the economy. Woolworths addressed those fears directly. As the downturn took hold in Australia in February, Woolworths Ltd. announced that new store openings and growth in existing locations would create 7,000 jobs. “We see our role as generating economic activity and jobs,” CEO Michael Luscombe said in a release accompanying the announcement, noting that while 43,000 jobs had recently been lost in the retail sector, Woolworths would continue to hire. A commercial linked back to this message. It showed a mother going to a job interview with her son, with the message that “We employ thousands of Australians. And we’re always looking for more.” Without mentioning the “R” word explicitly, the spot sounded just the right tone of pragmatic optimism. Results: Although it shut operations in the U.K., Woolworths is Australia’s largest supermarket retailer, and in the quarter ending Oct. 4, year-over-year sales for the division increased by 3.8 percent to $11.5 billion. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 4
  5. 5. 7. FINANCIAL TIMES Program: Global Downturn Country: U.K. Why it’s one of the best: The Financial Times’ novel use of an outdoor medium—billboards empty because of the recession—tied in perfectly with the newspaper’s message. Description: The Financial Times took over empty billboard spaces in the U.K. to question the wisdom of decreasing marketing budgets during hard times. Stickers in the right-hand corners of the billboards posed questions like “What’s the first mistake businesses make?”—alluding to studies showing that businesses that increase ad spend during recessions are the ones that do best afterward. The goal: to encourage brands to advertise in the Financial Times. Results: The campaign won a gold CLIO Billboard Award. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 5
  6. 6. 6. PORTUGUESE RED CROSS Program: Store+ The Store That Sells Hope Country: Portugal Why it’s one of the best: The Red Cross understood the importance of tapping into the core value of hope. Description: Before Christmas last year, as consumers tightened their wallets, the Red Cross in Portugal decided to sell hope in a literal way. In a popular mall in Lisbon, it opened a store where little cards promoting “hope” were clipped onto hangers and stocked on shelves, just as normal goods would be; the cards sold for 10 euros apiece. “Hope” was positioned as a gift alternative for the holidays, a product that people can’t hold in their hands but can feel emotionally. Shoppers could get the satisfaction that comes with both a mall transaction and the act of giving. Where its messaging could have played on the guilt of previously generous patrons, the Red Cross spoke in a voice of optimism. Results: Hundreds of people attended the opening night, and in its first day the store achieved a place in the mall’s top 10 for sales; the Red Cross extended the store’s hours, as well as its closing date. And the store not only helped raise immediate funds but boosted awareness for the Red Cross. The Hope Store won a gold Lion for PR, two silvers for Direct and a silver and bronze for Promo at the Cannes International Advertising Festival. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 6
  7. 7. 5. JETBLUE Program: Bigwigs: Making Jetting Newsworthy Country: U.S. Why it’s one of the best: JetBlue moved quickly to leverage public sentiment in a timely campaign that was perfectly aligned with its brand. Description: As C-suite execs were getting chastised for their excesses—private jets included—amid bailout mania, JetBlue turned out its “Bigwigs” campaign, poking fun at stuffy, stodgy CEOs. It subtly communicated “more for less” by telling “Bigwigs, Muckety-Mucks, Private Jetters and Big Cheeses” how “jetting on JetBlue is a lot like on your private jet, with a few basic differences.” A section on the airline’s Web site described features such as lots of leg room, DirectTV, free snacks and “fares that won’t give the CFO a conniption.” Not only did the work fit with JetBlue’s distinctly un- stuffy, anti-stodgy airline brand, but it was relevant and timely, and undoubtedly struck a chord with bailout-weary American taxpayers. Results: While most airlines were experiencing double- digit declines, JetBlue recently reported its third consecutive profitable quarter. And as its rivals laid off staff and cut flights, JetBlue hired 2,300 workers and expanded to eight additional cities. The airline looks likely to move from Fortune’s top 1,000 to the top 500. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 7
  8. 8. 4. CASH FOR CLUNKERS Photo: Infrogmation/creativecommons.org Program: Cash for Clunkers Countries: Germany and the U.S. Why it’s one of the best: These programs used the recession to achieve a higher goal: to get more efficient cars on the market. In doing so, they gave a desperately needed boost to the auto industry. Description: Germany started its “Cash for Clunkers” campaign in January with the hope that it would encourage people to buy German-made cars, help the environment and stimulate the economy. The U.S. government’s “Cash for Clunkers” program in July and August encouraged Americans to trade in their gas-guzzling clunkers for thousands of dollars off the price of a new, better-for-the-environment vehicle. Results: While auto sales surged 21 percent in Germany, buyers tended to choose small and cheap Hyundais over German-made BMWs or Mercedes-Benz vehicles. Still, the program helped raise confidence levels in German business, according to an Ifo Institute for Economic Research report. In the U.S., the program was so successful that the government ran out of funds for it and shut it down early. “Cash for Clunkers” stimulated the sale of nearly 700,000 cars; GM and Ford even announced additional factory shifts to keep up with the demand. The “Cash for Clunkers” program helped boost consumer spending on durable goods, which grew by an annual rate of 22.3 percent in the third quarter compared to a decline of 5.6 percent in the previous quarter. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 8
  9. 9. 3. THE ECONOMIC TIMES Program: Power of Ideas Country: India Why it’s one of the best: Rather than empathize with anxious consumers, The Economic Times inspired them. Description: The Economic Times created a platform to encourage entrepreneurship by giving people an opportunity to submit their business ideas to the financial daily, as well as receive mentoring and the chance for funding. Its “Power of Ideas” contest provided both inspiration and advice for business development in a recession. Over the last decade, the spirit of Indian entrepreneurship has been riding high, and there is a collective feeling in corporate India that the country will determinedly turn the recession into opportunity. Indeed, while anxiety levels are high in India, our AnxietyIndex found a great deal of optimism, both absolute and relative to the other countries we’ve studied. Research we conducted in April and May found that aside from crime and terrorism, Indians believed that most factors—from the economy to the cost of living to unemployment rates—would improve over the next six months. Rather than mirror the anxiety of consumers, The Economic Times treated them as hope- fueled and talked to them accordingly. It helped to feed India’s ambition and optimism. Results: According to the program’s Web site, more than 12,000 ideas were registered; 254 finalists ultimately went on to be mentored by professionals. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 9
  10. 10. 2. LEVI’S Program: Live NOW, Pay Later Country: India Why it’s one of the best: Levi’s came up with a solution that was revolutionary for the apparel category. Description: In India, Levi’s is a premium brand and the No. 1 denim brand. The brand is hugely aspirational; making it more accessible and broadening the user base is the challenge: How does Levi’s cater to those who aspire to it but may not be able to afford a purchase? And how can it do that without discounting the brand or weakening its premium positioning? Levi’s also wanted to increase frequency and value of purchase among existing customers. In the face of a global recession, these were particularly challenging goals. Our April-May AnxietyIndex in India found that when it comes to saving money, Indians are most likely to consider reducing purchases of branded apparel; one-third have contemplated switching apparel brands in favor of more affordable options. To counteract these tendencies, Levi’s brought in new category thinking: It partnered with one of India’s major banks (HDFC) to offer an EMI (equal monthly installment) scheme. JWT wanted to use the creative to keep the brand in the conversation. So the communication champions a “Live Now” philosophy; the anthem print ad, which brings this to life, takes on the “un” from the “Live Unbuttoned” global Levi’s campaign. Results: The program has seen terrific industry and consumer response, and has generated a lot of PR and buzz. The average bill value has risen by about US$20, and 60 percent of HDFC credit card users who have recently made a Levi’s purchase have used the EMI scheme. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 10
  11. 11. 1. HYUNDAI MOTOR AMERICA Program: Hyundai Assurance Country: U.S. Why it is the best: Hyundai Motor America was a leader in removing the risk from purchase. Its Assurance Program inspired myriad brands to follow with their own versions of job-loss guarantees. Description: Lose your income, return your car—that’s the assurance the South Korean brand gave people who financed or leased a new Hyundai in 2009. The deal provided “certainty in uncertain times,” as the promotional material stated. With anxiety levels high and the future uncertain, consumers were reluctant to spend in 2009—even if they weren’t directly impacted by the recession. They were especially reluctant when it came to bigger-ticket items or long-term financial commitments. Hyundai sold peace of mind by taking some of the risk out of the equation—as did the brands that followed, including JoS. A. Bank Clothiers and Bigelow Homes in the U.S., Telefónica in Spain, AIG Israel, Virgin Mobile USA and Ponto Frio in Brazil. Results: At a time when most major automakers in the U.S. watched sales slide by as much as 25 to 50 percent, Hyundai Motor Group reports that sales are up 2.6 percent for the year—in fact, it’s the only automaker to see its U.S. sales rise. Hyundai Motor Group (which includes the Hyundai and Kia brands) gained 2.2 percentage points of market share this year, becoming the sixth-largest automaker in the U.S. based on sales volume. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 11
  12. 12. APPENDIX LEVELS AND DRIVERS OF CONSUMER ANXIETY This cross-market look at JWT’s AnxietyIndex compares the levels, intensity and drivers of anxiety across 11 markets: the U.S., the U.K., Canada, France, Spain, Australia, Brazil, Russia, India, China and Japan. It is based on data collected from adults age 18-plus through online surveys conducted in 2009. Data were weighted by age, gender and household income based on government population statistics. Levels of anxiety vary significantly across the 11 markets we’ve surveyed, ranging from a low of 35 percent in China to a high of 90 percent in Japan. (See Figure 1.) While overall anxiety levels remain generally high, they are starting to abate across the markets we regularly track: In the U.S., the anxiety level dropped from a high of 82 percent in November 2008 to 72 percent in September; in the U.K., it shrunk from a high of 74 percent in March to 65 percent in September; in Canada and Australia, it fell from 71 percent in December 2008 to 55 percent and 59 percent, respectively, in September. Figure 1: Levels of anxiety Overall, given everything that is going on in the world, the country, and your family’s life, how nervous or anxious would you say you currently are? % Nervous/Anxious % Not Nervous/Anxious 100 90 10 16 26 28 30 80 34 35 41 45 70 58 65 60 50 90 84 40 74 72 70 66 65 30 59 55 20 42 35 10 0 Japan Russia India U.S. Spain Brazil U.K. Australia Canada France China Nervous/Anxious February-March 2009 Not Nervous/Anxious February-March 2009 ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 12
  13. 13. While Japan is the most anxious market, Russia records the most intense anxiety, with 38 percent of respondents saying they feel very nervous/anxious. (See Figure 2.) Again, the intensity of anxiety has been diminishing in the markets we survey on a regular basis: In the U.S., the percentage of respondents reporting intense anxiety fell from 25 percent in early November 2008 to 16 percent in September; in the U.K., from 16 percent in March to 9 percent in September; and in Canada, from a high of 17 percent to 8 percent in September. Figure 2: Intensity of anxiety Overall, given everything that is going on in the world, the country, and your family’s life, how nervous or anxious would you say you currently are? % Very Nervous/Anxious 50 40 38 30 30 25 20 18 16 12 10 9 8 8 10 6 0 Russia India Japan Brazil U.S. Spain France U.K. Australia Canada China ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 13
  14. 14. Not surprisingly, the economy is the primary driver of anxiety in most markets. (See Figure 3.) In the U.S., the U.K. and Spain, the primary drivers of anxiety are the economy and the cost of living. The same is true for Russia, Japan and India, although it’s more exaggerated in those markets. Also driving anxiety in Japan is the cost of health care, crime and political leadership. Indians are worried about those factors, as well as crime, the threat of terrorism and current military hostilities. Brazilians are concerned about the cost of health care and crime. Relative to the average of the 11 countries we’ve surveyed, the drivers of anxiety in Canada, France, Australia and China are muted. Figure 3: Drivers of anxiety Events in your life, in the country and in the world can make people nervous or anxious. For U.S. each of the following, please indicate how nervous or anxious you currently are, or not. Canada Brazil Political Leadership U.K. U.S. 1400 Canada Spain Brazil France* Threat of 1200 Political Leadership State of U.K. Russia 1400 Spain Japan* Terrorism Economy 1000 France* China** Threat of 1200 State of Russia India* 800 Japan* Terrorism Economy Australia 1000 China** Average India* 600 800 Australia Average 400 600 Potential Cost of Military 400 200 Potential Health Care *** Hostilities Cost of Military 200 0 Health Care Hostilities 0 Current Cost of Current Cost of Military Military Living Living Hostilities Hostilities Crime Crime Job Security Job Security AnxietyIndex: % who are nervous or anxious/% who are not *Potential military hostilities not measured in France, Japan or India. **Political leadership, threat of terrorism, and potential and current military hostilities not measured in China. ***Quality of health care measured in Canada and France instead of cost of health care. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 14
  15. 15. In terms of specific drivers of anxiety, unemployment is heavily cited across a number of nations, including the U.S., Brazil, Spain, Japan and India. The U.S. is also worried about the government’s budget deficit, as is the U.K. Food prices are causing anxiety for Brazilians, Indians and Russians. Russians are also worried about the safety of the food supply, while Brazilians are also concerned about the impact of global warming. India is worried about a host of issues, including the impact of global warming, natural disasters, the national infrastructure, the stock market, gas/petrol prices, the housing market and the war in Iraq. The same applies for Japan, which is concerned about the impact of global warming, natural disasters and the quality of products imported from China. Australians are worried about gas prices. Compared to the average of the markets we’ve surveyed, Canada, France and China are fairly calm about these factors. Figure 4: Specific drivers of anxiety Events in your life, in the country and in the world can make people nervous or anxious. For each of the following, please indicate how nervous or anxious you currently are, or not. U.S. Canada Brazil U.K. The war in Iraq Spain Impact of global warming 1000 The war in Afghanistan France* Russia 800 Japan* China** The housing market India* Natural disasters 600 Australia Average 400 Safety of the food Gasoline/Petrol prices 200 supply 0 Quality of products Food prices imported from China The government’s budget deficit Unemployment rates The state of the national Bank failures infrastructure The stock market AnxietyIndex: % who are nervous or anxious/% who are not *Bank failures, government’s budget deficit, safety of food supply and the war in Afghanistan not measured in Japan or India. **Bank failures, government’s budget deficit, quality of products imported from China, safety of food supply, the war in Iraq and the war in Afghanistan not measured in China. ANXIETYINDEX.COM ANXIETYINDEX QUARTERLY 15
  16. 16. 466 Lexington Avenue New York, NY 10017 www.jwt.com www.jwtintelligence.com www.AnxietyIndex.com For AnxietyIndex inquiries, please contact Ann Mack (ann.mack@jwt.com, 212-210-7378). For press inquiries, please contact Erin Johnson (erin.johnson@jwt.com, 212-210-7243).