This document discusses strategies for managing marketing budgets during an economic crisis or recession. It provides background on past recessions, including that they tend to be short and mild, lasting around 10 months on average and resulting in around 3% decrease in GDP. It also notes that some industries are hit harder than others in recessions. The document discusses strategies that past companies have used when facing recessions, noting that those who continued or increased advertising saw higher sales and market share gains after the recession compared to those who cut marketing. It provides examples of companies like Findus that increased market share during recessions through advertising. It also discusses how consumer values and purchasing may shift somewhat towards value and promotions during recessions but overall spending patterns do not radically
Presentación realizada por la PPA explicando los beneficios de mantener la inversión publicitaria en general, y en revistas en particular, en períodos de recesión
Presentación realizada por la PPA explicando los beneficios de mantener la inversión publicitaria en general, y en revistas en particular, en períodos de recesión
A global marketing strategy (GMS) is a strategy
that encompasses countries from several
different regions in the world and aims at coordinating
a company’s marketing efforts in
markets in these countries.
A GMS does not necessarily cover all countries
but it should apply across several regions.
A typical regional breakdown is as follows:
Africa, Asia, and the Pacific (including Australia)
Europe and the Middle East, Latin America, and
North America. A ‘‘regional’’ marketing strategy
is one that coordinates the marketing effort in
one region.
A GMS should not be confused with a global
production strategy. Outsourcing and foreign
manufacturing subsidiaries, common features
of a global production strategy, can be used
with or without a GMS for the finished products.
As listed in Table 1, GMSs can involve one
or more of several activities.
The coordination involved in implementing
a GMS unavoidably leads to a certain level
of uniformity of branding, of packaging, of
promotional appeal, and so on (Zou and
Cavusgil, 2002). This also means that a GMS,
in some ways, goes counter to a true customer
orientation (see MARKETING PLANNING). The
product and marketing mix are not adapted
to local preferences, as a customer orientation
suggests. This is a potential weakness of GMSs,
Table 1 Components of a global marketing
strategy.
Items Listed in Order of Descending Occurrence
• Identical brand names
• Uniform packaging
• Standardized products
• Similar advertising messages
• Coordinated pricing
• Synchronized product introductions
• Coordinated sales campaigns
and leaves opportunities open for local products
and brands.
As the notion of integrated marketing
communications (see INTEGRATED MARKETING
COMMUNICATION STRATEGY) suggests,
the ensuing consistency can have positive
revenue benefits because of reinforcement of a
unique message, spillovers between countries,
and so on. But the main driving force behind
the adoption of a GMS is the scale and
scope of cost advantages from such uniform
marketing strategies. These cost advantages
include elimination of unnecessary duplication
of effort, savings on multilingual and same-size
packaging, use of the same promotional material,
quantity discounts when buying media, and so
on. The pros and cons of a GMS are given in
Table 2.
THE ORGANIZATIONAL CONTEXT
Firms typically contemplate adopting a more
coordinated GMS, once they have significant
presence in several countries and regions. Since
local markets will never be exactly the same,
a proposed global strategy will generally not be
welcomed by the country managers. The existing
local operations will have to be convinced to
adopt the new global strategy. Thus, a GMS
is always top-down, not bottom-up, and it is
easy for antiglobalization sentiments to stir even
within a multinational company.
The typical solution to this problem is to allow
country managers to be involved in th
Practical Reasons Why the Advertising of FMCG should continue even in a Reces...BrandEyeMedia
Companies usually reduce their advertising spend in a recession, this piece gives practical reasons why advertising for FMCG companies in a recession should continue.
A global marketing strategy (GMS) is a strategy
that encompasses countries from several
different regions in the world and aims at coordinating
a company’s marketing efforts in
markets in these countries.
A GMS does not necessarily cover all countries
but it should apply across several regions.
A typical regional breakdown is as follows:
Africa, Asia, and the Pacific (including Australia)
Europe and the Middle East, Latin America, and
North America. A ‘‘regional’’ marketing strategy
is one that coordinates the marketing effort in
one region.
A GMS should not be confused with a global
production strategy. Outsourcing and foreign
manufacturing subsidiaries, common features
of a global production strategy, can be used
with or without a GMS for the finished products.
As listed in Table 1, GMSs can involve one
or more of several activities.
The coordination involved in implementing
a GMS unavoidably leads to a certain level
of uniformity of branding, of packaging, of
promotional appeal, and so on (Zou and
Cavusgil, 2002). This also means that a GMS,
in some ways, goes counter to a true customer
orientation (see MARKETING PLANNING). The
product and marketing mix are not adapted
to local preferences, as a customer orientation
suggests. This is a potential weakness of GMSs,
Table 1 Components of a global marketing
strategy.
Items Listed in Order of Descending Occurrence
• Identical brand names
• Uniform packaging
• Standardized products
• Similar advertising messages
• Coordinated pricing
• Synchronized product introductions
• Coordinated sales campaigns
and leaves opportunities open for local products
and brands.
As the notion of integrated marketing
communications (see INTEGRATED MARKETING
COMMUNICATION STRATEGY) suggests,
the ensuing consistency can have positive
revenue benefits because of reinforcement of a
unique message, spillovers between countries,
and so on. But the main driving force behind
the adoption of a GMS is the scale and
scope of cost advantages from such uniform
marketing strategies. These cost advantages
include elimination of unnecessary duplication
of effort, savings on multilingual and same-size
packaging, use of the same promotional material,
quantity discounts when buying media, and so
on. The pros and cons of a GMS are given in
Table 2.
THE ORGANIZATIONAL CONTEXT
Firms typically contemplate adopting a more
coordinated GMS, once they have significant
presence in several countries and regions. Since
local markets will never be exactly the same,
a proposed global strategy will generally not be
welcomed by the country managers. The existing
local operations will have to be convinced to
adopt the new global strategy. Thus, a GMS
is always top-down, not bottom-up, and it is
easy for antiglobalization sentiments to stir even
within a multinational company.
The typical solution to this problem is to allow
country managers to be involved in th
Practical Reasons Why the Advertising of FMCG should continue even in a Reces...BrandEyeMedia
Companies usually reduce their advertising spend in a recession, this piece gives practical reasons why advertising for FMCG companies in a recession should continue.
Presentation av Michael Åhlman under studiebesök vid Uppsala kommuns samlastningscentral. När det gäller siffrorna från skärmdumparna ur Hållbarhetsportalen (på slutet av materialet) så v.v. notera att dessa siffror inte är kvalitetssäkrade då bilderna tagits från testmiljön där man har möjlighet att "leka runt" med data i test/utbildningssyfte.
Now is the time to separate myth from fact on what it takes to survive and thrive in a downturn. We’ll call on recessionary marketing research from the 1920’s to the 1990’s to glean insights on how successful marketers innovated, changed and thrived to emerge stronger and with greater market share than ever.
Advertising During Times Of Economic UncertaintyBG Mahesh
B2B advertising is a must during economic downturn if you want your business to improve.
The research conducted by American Business Media suggests online advertising will see a good increase during this downturn
This short presentation followed from my blog post on the subject, where I thought it important to look at the connections between brands and inflation which, as we all know, has been raging both in India and around the world as part of the economic recovery after the Covid-19 lockdowns.
Here, I look at the different types of consumer price inflation and how companies might deal with them. As well as the impact of inflation on consumers' brand choices as well as market segments.
TABLE OF CONTENTS1. Mission Statement Page 22. Marketing .docxmattinsonjanel
TABLE OF CONTENTS
1. Mission Statement: Page 2
2. Marketing Objectives: Page 2
3. SWOT Analysis: Pages 2-4
4. Target Market: Page 4-5
5. Marketing Activities: Pages 5-7
6. Lessons Learned: Pages 7-15
a) Year 1
b) Year 2
c) Year 3
d) Year 4
e) Year 5
f) Year 6
g) Year 7
h) Year 8
i) Year 9
j) Year 10
7. Summary: Pages 16-17
1. MISSION STATEMENT:
To establish Allstar Brands as a market leader of Over-The-Counter multi-symptom cold/allergy relief, while maintaining the highest level of customer satisfaction through product effectiveness, quality and affordability.
2. MARKETING OBJECTIVES:
· To increase the stock price by 3 points every 2 years
· To maintain a combined direct/indirect sales force of no less than 140
· To increase net income to $40 million in the next 2 years
· To increase brand awareness by 5% yearly for all products of Allstar toward a long-term goal of 85%, thereafter any increase is found sufficient
· To maintain advertising budget expenditure above $26 million, minimum $10 million toward Allround, Allround+ and minimum $9 million toward Allright
· Introduce one new product within every 3-year period according to appropriate market trends and characteristics of demand
· To keep promotional allowance at or above 14% for all products
· To increase customer satisfaction to 60% for all Allstar Brand products within the next 2 years
3. SWOT:
Strengths:
· Allstar Brands have a competitive advantage which is based on the lowest price in the cold/allergy market
· Brand awareness for the products of Allstar Brands is one of the highest among the competitors
· Product mix targets variety of ailments (Allround – multi-symptom, Allround+ - cold and allergy, Allright – cough and cold)
· Customer satisfaction for Allstar products ranges from 54% to 61%
· Allround is the second highest brand purchased among the OTC medicine and has the second largest market share of manufacturing sales
· Allround Brand perception of cough and ache medicine is the highest among the competitors
· Steady rise of product contribution for Allright and Allround+
· Allstar offers relief for all of the most frequent symptoms of ailments: aches, coughing, and chest congestion
· Allright attains largest market share based on manufacturing sales of 14.9% in the cough medicine market
Weaknesses:
· Low sales force
· Steep drop off of stock price after year five
· Allround has the lowest net income among the competitors
· Advertising budget for every product is not sufficient for leading a proper advertising campaign to increase brand awareness
· A stronger competitor Besthelp keeps Allround from being the leader of brands purchased
· Low budget allocated to promotional mix of all 3 products
· Current customer’s intentions to buy Allround, Allround+ and Allright are larger than Allstar can produce
· Annual fall of Allround’s total sales and product contribution since year 5
· Constant fall of trade ratings for Allright and Allround+
· Alls ...
Essential Principles of Effective Management: A Concise Guidebmodi554
Manage Right: Core Principles in 40" encapsulates the fundamental concepts of effective management in a succinct manner. This concise guide serves as a comprehensive reference for both seasoned managers and those new to leadership roles. With a focus on brevity, it distills decades of management theory and practice into essential principles that are easily digestible and applicable across various industries and organizational contexts.
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It is crucial for the taxpayers to understand about the TDS Return Filing Due Date, so that they can fulfill your TDS obligations efficiently. Taxpayers can avoid penalties by sticking to the deadlines and by accurate filing of TDS. Timely filing of TDS will make sure about the availability of tax credits. You can also seek the professional guidance of experts like Legal Pillers for timely filing of the TDS Return.
3.0 Project 2_ Developing My Brand Identity Kit.pptxtanyjahb
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It is a sample of an interview for a business english class for pre-intermediate and intermediate english students with emphasis on the speking ability.
India Orthopedic Devices Market: Unlocking Growth Secrets, Trends and Develop...Kumar Satyam
According to TechSci Research report, “India Orthopedic Devices Market -Industry Size, Share, Trends, Competition Forecast & Opportunities, 2030”, the India Orthopedic Devices Market stood at USD 1,280.54 Million in 2024 and is anticipated to grow with a CAGR of 7.84% in the forecast period, 2026-2030F. The India Orthopedic Devices Market is being driven by several factors. The most prominent ones include an increase in the elderly population, who are more prone to orthopedic conditions such as osteoporosis and arthritis. Moreover, the rise in sports injuries and road accidents are also contributing to the demand for orthopedic devices. Advances in technology and the introduction of innovative implants and prosthetics have further propelled the market growth. Additionally, government initiatives aimed at improving healthcare infrastructure and the increasing prevalence of lifestyle diseases have led to an upward trend in orthopedic surgeries, thereby fueling the market demand for these devices.
The world of search engine optimization (SEO) is buzzing with discussions after Google confirmed that around 2,500 leaked internal documents related to its Search feature are indeed authentic. The revelation has sparked significant concerns within the SEO community. The leaked documents were initially reported by SEO experts Rand Fishkin and Mike King, igniting widespread analysis and discourse. For More Info:- https://news.arihantwebtech.com/search-disrupted-googles-leaked-documents-rock-the-seo-world/
Remote sensing and monitoring are changing the mining industry for the better. These are providing innovative solutions to long-standing challenges. Those related to exploration, extraction, and overall environmental management by mining technology companies Odisha. These technologies make use of satellite imaging, aerial photography and sensors to collect data that might be inaccessible or from hazardous locations. With the use of this technology, mining operations are becoming increasingly efficient. Let us gain more insight into the key aspects associated with remote sensing and monitoring when it comes to mining.
Accpac to QuickBooks Conversion Navigating the Transition with Online Account...PaulBryant58
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1. How to manage marketing
budgets in economic crisis
situation
Managing communications:
opportunities and threats in the current
media environment
Vilnius, 14th October 2008
4. “By any common-sense definition, we are in a
recession.”
Warren Buffett
Source: NY Times, March 8, 2008
Back to (other) recessions
5. Source: WARC Online for UK market (*Constant price figures before 1988 are adjusted by the Retail Prices Index;
from 1988 onwards by the Consumer Prices Index), Laura James, Aug.2008
Back to (other) recessions
• The advertising sector has experienced at least one recession / growth
slowdown in each of the last four decades
6. - “Cut the budget!”
- “Reduce the number of agencies!”
- “Call a pitch!”
- “Ask everyone to take an automatic 15%
reduction”
With crisis comes opportunity
It has long been established that those brands
which continue to communicate their
values in recessionary times receive long-
term sales benefits. Cutting marketing
spend in a recession delays eventual recovery.
Crisis
7. What do we know about recessions?
• Recessions tend to be short
Source: Havas Media US
Recession Duration
1953-54 10 months
1957-58 8 months
1960-61 10 months
1969-70 11 months
1973-75 16 months
1980 6 months
1981-82 16 months
1990-91 8 months
2001 8 months
Median 10 months
• Recessions tend to be mild
Recession % Change Real Annual GDP
1953-54 -3.0%
1957-58 -3.5%
1960-61 -1.0%
1969-70 -1.1%
1973-75 -4.3%
1980 -2.4%
1981-82 -3.4%
1990-91 -3.0%
2001 -1.4%
Median -3.0%
• Recessions are selective
• Recessions impact some industries, products and regions of the country hard and bypass
others entirely. Non-durables and services are least affected during recessions
• Among the industries and products most affected are: automobiles, home furnishing,
large appliances, consumer electronics, travel and airlines, home improvement
• Relatively unaffected are: liquor and wine, tobacco, gambling, small appliances,
packaged goods, restaurants
8. What’s known about other past
recessions?
Source: Havas Media US
Recession Author Conclusions
1923 Roland S. Vaile
(HBR)
The biggest sales increases throughout the period were rung up by
companies that advertised the most
1949, 1954,
1958, 1961
Buchen
Advertising
Sales and profits dropped off at companies that cut back on advertising
1970 ABP/Meldrum &
Fewsmith
Sales and profits can be maintained and increased in recession years and
in the years immediately following by those who are willing to maintain an
aggressive marketing posture
1974-1975 ABP/Meldrum &
Fewsmith
Companies that did not cut advertising expenditure during the recession
experienced higher sales and net income than those companies that cut in
either or both recession years
1981-1982 McGraw-Hill
Research Lab.
Advertising
Performance
Companies that maintained or increased advertising averaged sales
growth of about 275% over the next 5 years. Conversely, those companies
that eliminated or decreased advertising averaged sales growth of about
19% over the next 5 years
not
specified
periods
Cahner’s
Publishing /
Strategic Plann.
Institute (SPI)
Used PIMS (Profit Impact of Marketing Strategies) database of consumer
businesses: Businesses that increased media investments (between +28%
to +80%) during a recession period “gained an average of 1.5 points of
market share.”
1990-1991 Cooper’s &
Lybrand/
Business
Science Intnal.
A strong marketing program enables a firm to solidify its customer base,
take business away from less aggressive competitors, and position itself
for futures growth during the recovery.
9. Companies that increase their
advertising investment in times of
recession emerge clearly reinforced
(Spain)
Sources: Infoadex, Havas Media
11,2%
65,4%
Pre-recession
98-00
28,0%
12,0%
60,0%
Recession
01-03
Post-recession
04-06
32,0%
12,3%
55,7%
23,5%
100%
% Ad investment in the automobile market
pre, during and post recession
Spain, 1998 – 2007
Losers
Neutrals
Winners
10,9%
66,3%
26,8%
10,1%
63,1%
31,9%
11,2%
56,9%
22,9%
100%
Share of market pre, during and post
recession
Spain, 1998 – 2007
-9,4%
+9,0%
Pre-recession
98-00
Recession
01-03
Post-recession
04-06
10. The risk of reducing SOV
• Data from Millward Brown show a strong correlation between a brand’s market
share and its level of “bonding” with consumers.
• Achieving high levels of brand image and brand usage can help brands “bond” with
consumers.
• If a brand cuts its advertising budget relative to its competitors, it is at higher risk of
losing market share
Source: WARC (Stephen Whiteside) / Millward Brown, April 2008
11. Winning business strategies
• Malik PIMS analysed data from 1,000 business units in developed economies during previous
economic downturns and the first two years of following recovery from both pre- and post-
2000 to identify the best business strategies.
• Its assessment of their return on capital employed (ROCE) and changes in market share
during the first 2 years of recovery found that while maintaining or reducing fixed costs was
beneficial during times of economic uncertainty, an increase in investment in marketing
spending was generally linked with business success in the long term.
• Downturns provide an opportunity for a brand to improve its market share as media costs and
competitor spending can both decline, allowing advertisers who do increase their spend to
build customer preference and help maintain a product’s relative price.
Source: WARC (Stephen Whiteside) / Malik PIMS, April 2008
12. •1990 and 1991 were difficult years for the frozen recipe meals market. As non-
essential foods, they suffered in the recession; sales in 1991 were 8% down on 1989.
•Over this period, Findus managed to grow its frozen lasagne business by
180%. It took clear brand leadership, having been 12th brand in 1989, 6th in 1990 and
number 1 in 1991, in the 'league table' of all frozen recipe meals.
•Much of the growth derived from distribution gains, but the driving force behind the
brand was a TV commercial for lasagne, 'Our Billy'. This film dramatised the benefits
of Findus Lasagne in meeting the demands of today's fragmented households
through a difficult teenage boy whose demeanour is transformed after enjoying the product.
Findus Lasagne (UK): behind the recession
Source: IPA (Paul Hackett), 1992, Nielsen
13. •The commercial ran in five national bursts over 1990 and 1991. The results were dramatic,
rate of sale per point of distribution nearly tripled, and market share more than doubled.
•Findus maintained a large price premium over retailer brand lasagnes
•Findus Lasagne grew dramatically in 1989-1991, following a single-minded sales drive
and TV advertising campaign. It was the only manufacturer of standard recipe
meals to come through the recession smiling.
Findus Lasagne (UK): behind the recession
Source: IPA (Paul Hackett), 1992
14. Findus Lasagne (UK): behind the recession
Source: Google search, YouTube
•An econometric model was developed to explain Findus Lasagne's volume share
of total frozen lasagne. The model found that a 1% increase in SOV will
increase Findus Lasagne's volume share by 0.075%.
16. Consumers’ values change during
recession: focus on VFM, cost, and
promotion… really?
Byron Sharp (Ehrenberg-Bass Institute), about ‘how will consumer spending change?’:
• One of the big lessons we’ve learnt from behavioural data (category buying, brand
buying, and media consumption) is how habitual consumers are. Underneath the
day-to-day randomness lie rather consistent patterns. This suggests that even if
consumers want to, they will find it difficult to change behaviour.
• Even in a severe recession, the economy is much the same size as it was in
previous years. Many consumers have just as much disposable income
as ever.
• Consumers will find it easier to make changes in non-regular behaviours than to
modify their day-to-day lives substantially. The easiest way may be simply to
postpone expensive discretionary purchases like overseas holidays, new cars, and
large screen TVs. Even these categories do not collapse in recessions.
• Rising prices, due to energy and other raw material cost rises (such as more
expensive food ingredients), are unlikely to affect demand for everyday
consumer goods and services.
• The 1970s showed no flight to private label brands either in spite of
supermarkets deliberately introducing some budget generic brands to cater for the
hard times.
Source: WARC (Byron Sharp, Ehrenberg-Bass Institute), Sept.2008
17. Crisis does
not affect
everybody
in the same
way
Source: adn, 6 October 2008
Lipstick
indicator
(Leonard Lauder):
consumers tend to
buy more beauty
products in
recession periods
Sales growth in:
- make-up, lipstick
- lingerie
- gym (inscriptions)
- videogames
- clothes arrangem
- language schools
18. 33% of consumers choose
PLs to reduce expenses, 5
points up vs. 2005
• Crisis force consumers to change their shopping
habits
• FMCG +6% (in value, Jan-Aug’08 vs. Jan-Aug’07, +1.5%
demand, +4.4% prices increase),
• Pharmaceuticals +6%
• Cell phones +9%
• Tobacco +4%
• Impulsive purchase +13%
• Automobile -4%
• White goods (household appliances) -12%
• Horeca -1%,
• Leisure -10%
• p3m: Books -1%, videogames -5%, movies -21%
• “To eat … we won't stop to eat, but there are
purchases that can be delayed” (PJ Domínguez, Nielsen
Business)
• 47% of consumers appeal to the promotions made by the trade
• 40% change to products with better value for moneySources: La Vanguardia, Nielsen, Reuters
19. As a consequence of the crisis, do you
buy more private levels? 61% Yes
Source: La Vanguardia.es
20. Average same store sales for the last 3 months (Dec.2007, Jan.2008, Feb.2008) shows that
while most of the retailers suffer heavy drops, big box retailers are still doing well
Same store sales – Dec 07 thru Feb 08
-15.00% -10.00% -5.00% 0.00% 5.00%
Circuit City (Dec.)
Limited Brands
Kohl’s
Lowe’s
Home Depot
Nordstrom
JC Penney
GAP
Sears (4Q)
Macy’s
Target
Best Buy (Dec.)
Wal-Mart
TJX
Consumers are redirecting their spending
power to retailers that they perceive as
offering value
Wal-Mart.
“Save money. Live better”
21. Source: AdAge.com
Walking in the shoes of your consumers is the key to keeping products moving during
a recession, said Kraft Foods CMO Mary Beth West. Speaking at Ad Age's annual
Women to Watch luncheon, the marketing chief at America's largest food company
emphasized the importance of understanding an economic downturn from the point of
view of cash-strapped shoppers. And she explained how Kraft is using that data to
adjust its marketing strategies.
Kraft Foods CMO: Recession Marketing Tips
• Experience the tight economy (recession) through the eyes of our consumers first hand. Listening to them in focus groups is the 1st
mile.
• 2nd mile would be calculating weekly for your target consumer and your brand/business, their income and subtract their expenses
(mortgage, …). Ask then, if I were that consumer, can I live with the remaining $?
• How can you re-define what your brand stands for? Once re-defined the value proposition, spend (money) into it!
23. Although the Internet will still be the
segment of highest growth… the TV
industry will continue leading the media
market worldwide
Sources: PWC “Global Entertainment and Media Outlook 2007-2011”
1
Global Advertising Market
($US billions )
2007 2009 2011
TV Radio Outdoor Internet Magazines Newspapers
CAGR 2007-11: 5,4%
427
479
531
37%
7%
25%
6%
14%
12%
37%
8%
27%
6%
9%
13%
37%
7%
26%
6%
12%
12%
CAGR%
2007-11
2,7%
18,3%
3,8%
6,5%
3,7%
5,1%
High growth
segments
Mid-Low
growth
segments
24. More media options
Print
Internet
TV (analog)
Digital TV
Radio (analog)
Digital Radio
Cinema
Outdoor
Wireless
Games
0
10
20
30
40
50
60
70
80
90
100
1900 1920 1940 1960 1980 2000 2020
Media Consumption
(hours, Average Top 20 global markets)
Fragmentation of Carriers
31. Will Marketing Execs cut ad
spending during recession?
• Epsilon: Economy shrinking 65% of CMO ad budgets, money shifts
towards digital / interactive marketing
Source: Epsilon CMO Survey (175 US CMOs and marketing executives of some of the largest brands, Aug.2008)
• “A tough economic period is precisely the time when
marketing plays a key role”
• 94% agree
32. Will Marketing Execs cut ad
spending during recession?
• “How does your firm determine target market for each channel?”
• 50% use data-driven marketing techniques
• 31% use sophisticated modeling tools to analyze existing customer data (behavioral,
preference and demographic)
• 19% analyse past purchase behavior
• 28% make “rough estimates based on past experience
• Most popular emerging channels:
• Social computing (WOM, social networking sites, viral advertising, ...)
• 42% interested in adding it to their marketing mix
• Blogs
• 35% desired to use them and 19% already using them
• Podcasting
• 31% interested in adding it to their marketing mix and 18% already having done so.
• Mobile Devices (phones/PDAs)
• 29% interested in and 22% have added them to their marketing mix
• “In this economic climate, marketing executives are seeking accountability and
measurable results” (Mike Iaccarino, CEO of Epsilon)
Source: Epsilon CMO Survey (175 US CMOs and marketing executives of some of the largest brands, Aug.2008)
33. Interactive marketers expect to hold
steady or increase spend during a
recession
Source: Forrester (“Interactive Marketers Are Bullish In A Recession”, April 2008)
34. Social media expects to see the
greatest increase in a recession
Source: Forrester (“Interactive Marketers Are Bullish In A Recession”, April 2008)
35. Spending plan will vary by industry
Source: Forrester (“Interactive Marketers Are Bullish In A Recession”, April 2008)
38. Our approach
Uncompromising pursuit of
value & advantage
in a ever changing world
Acquisition and retention
of high value consumers
Cost per acquisition
and cost of retention
=
+
-
39. Not convinced yet to not cut Marketing
budgets? Then let’s see what Joe wrote
two months ago in
Source: Joe Abruzzo (MPG US )
40. “Welcome to the age of austerity” or “How
to cut media spending without hurting
sales”
There are proven strategies to help minimize the sales impact of media spending cuts.
1. Target prospects who are most likely to give you their business
• Plans that make use of demographically defined targets tend to deliver wide audiences
including non-users of the advertised brand and individuals having limited or no
involvement with the product category
• More effective is behavioural targeting, based on purchase or usage behaviour. Focus
TV-program selection on shows with audiences having the highest composition of the
behavioral target, e.g. medium-to-heavy category users
2. Focus media delivery on geographical markets that matter most
• Many marketers rely entirely on the "low cost" CPM efficiencies of national media. “All-
national" plans tend to under-deliver to high-priority markets and over-deliver to low-
priority markets… the media weight isn't where you want it, but you are getting a terrific
deal!
• Rebalance media spending to benefit high-priority markets: 1st
) take advantage of natural
skews in national media delivery; identify national media vehicles that skew to desirable
geographical areas. 2nd
) fund increased delivery to high-priority markets through
reductions in national media spending
Source: Joe Abruzzo (MPG US )
41. “Welcome to the age of austerity” or “How
to cut media spending without hurting
sales”
3. Avoid excessive exposure frequency
• Maintaining weekly reach at minimum effective exposure frequency levels helps to avoid
excessive frequency and over-spending in general
• The return on your 2nd exposure will provide a greater ROI than the 3rd. The return on
your 3rd exposure will provide a greater ROI than the 4th. And so on…
4. Spend when the return will be greatest
• Many businesses continue to "flight" media schedules
• In the absence of seasonal variation in demand, with customers constantly moving in
and out of markets, media math suggests that, for the majority of brands, continuity beats
a flighted schedule
5. Avoid over-spending in any one medium
• There is no one optimal media mix, as it will vary by overall spending level
• Take a "reverse" zero-based approach to cutting spending. Continuously evaluate the
impact of the next reduction. Where will the impact of the next $ reduction be minimized?
Should the next cut come from TV or the internet?
Source: Joe Abruzzo (MPG US )
42. Proactive tactics that will optimize
brand performance during bad times
1. Concentrate on core values: reinforce brand values by demonstrating
strong consistency of message.
2. Increase spending and SOV clearly validates the connection between
increased spending and increased market share.
3. Concentrate on your loyal customers and, if need be, invest in
database marketing/CRM as a means of developing and maintaining the
communication.
4. Start sponsoring: events, cross-promotions, cause marketing… anywhere
the brand message can be spread.
5. Command premium price; strong brands can do it. The consumer
rationale is in how you explain the value-message of the brand.
6. Introduce new products: the advantage of being “first in” with an
innovation and entering a market with weakened competition may offset or
outweigh the possibly longer period of start-up investment in waiting until
good times return.
7. Negotiate media deals: as media prices soften, it becomes a buyer’s
market. At that point, lock in on long-term deals. Take advantage of the
weakened market to gain exponential value from the media buy.
Source: “Advertising in a recession” by the American Association of Advertising Agencies
43. Is it still possible to plan,
develop, execute and measure
communication campaigns with
small budgets, with very small
budgets, with 0 € … and
succeed?
44. Source: Havas Media
Nike Brazilian Ping-Pong: did he really did
that?
Word of “Mouse”?Word of “Mouse”?
52. Top tips for surviving a slowdown
1. Plan proactively: have plans, and back-up plans, ready for any eventuality
2. Manage the management: present highly visual demonstrations of your ROI
3. Concentrate on customers: focus on retaining and growing existing
customers rather than chasing new ones
4. Collect data sensibly: focus on collecting actionable information
5. Understand your customers: don't assume your previous customer insight
holds true
6. Analyse and segment: new behaviours will emerge - be proactive in working
these out and responding to them
7. Adapt your products and services: assess the environment and tailor your
propositions for the environment we're in
8. Integrate your channels: close the loop in your marketing operation
9. Exploit digital channels: be smart in moving people online, it might be quick,
but it needs very careful consideration
10.Use targeted email: be judicious - make sure you don't burn your bridges
with a rush to a 'cheaper' channel
11.Get the word out: get the jungle drums beating in the online communities
12.Apply the science: prove it, prove it, and then prove it again
53. Five points for adverting during a recession
1. Advertising during a recession pays off, as the data proves.
2. Advertising during a recession provides a unique opportunity to make your
firm more competitive
3. Sales momentum and brand recognition can be lost if advertising stops
during a recession
4. You can change the emphasis of advertising executions during a recession
- - a change in strategy may not be required.
5. New opportunities can result from a recession: a) new products, b) new
customers
54. To succeed in a recession, marketers
must…
Understand how this recession affects buying
• Last time around, the recession was kicked off by insane levels of spending by dot-coms and
a terrorist attack; together they blasted a huge hole in interactive marketing. But this
recession, generated by a housing bubble and credit crunch, affects fewer middle-to-high
income consumers. Use of the Internet and social applications continues to grow, creating an
opportunity. Marketers can use interactive channels to engage and convert worried
consumers as they research products and look for personal recommendations.
Measure more than awareness
• Interactive channels generate masses of data that you can use to make the case for their
effectiveness. How many conversions does your email generate, and how can you increase
those conversions? How many consumers does your social networking site touch, and how
much does their likelihood to buy increase? Marketers should build these types of metrics,
closer to sales and consideration than awareness, into each application they build.
Build for the long term
• Campaign-based advertising, like banner ads, fared worse in our survey than social
applications and email. But an email list is an asset — and so is a customer community, an
ongoing blog, or a presence on Facebook. Marketers should assess the value of these
assets based on their long-term growth and likelihood to generate steady purchasers.
Measure success using financial and investment metrics more suited to building assets than
generating awareness and sales in a given month or quarter.
Source: Forrester (“Interactive Marketers Are Bullish In A Recession”, April 2008)
55. Checklist for Developing Recession
Marketing Plans
PHASE I: ASSESSMENT OF EXTERNAL FACTORS
• Timing: When is the recession likely to begin and end? How long will the recovery take?
• Industry Impact: Does the industry/business typically lead or lag the recessionary cycles?
In past recessions, how deeply have the industry and the company been affected relative to
other industries and competitors?
• Technology: Historically, what is the industry’s commitment to technological developments?
Might the company or its competitors gain a long-term advantage by emphasizing R & D
during recessionary periods?
• Competition: How have major competitors reacted to previous economic downturns? How
will they most likely react to future recessions, given their strengths and weaknesses? How
can the firm best respond to likely actions of competitors?
• Customers: How are customers likely to change their purchasing behavior during economic
downturns? To what extent are they likely to move down the consumption chain, postpone
purchases, negotiate for concessions, or seek less expensive suppliers?
• Market Segments: How is demand likely to vary across market segments? For example,
which segments are more [or less] likely to be price sensitive or to opt for product offerings
with fewer bells and whistles? Ultimately, are some segments apt to be more profitable during
recessions than are other segments?
• Value: How do customers define value in the industry? In what ways may value be
enhanced without increasing costs or jeopardizing the brand / company’s image?
Source: WARC (Phillips W. Goodell, Charles L. Martin)
56. Checklist for Developing Recession
Marketing Plans
PHASE II: ASSESSMENT OF INTERNAL FACTORS
• Financial Resources: What are the firms financial strengths and weaknesses, such as
profit margins, cash flow, access to capital, and cost structure? How might these be managed
more effectively to minimize the impact of a recession? How might financial resources be
invested to leverage the firms future market position [e.g., in advertising to build market share
while competitors slash their advertising budgets]?
• Human Resources: How critical are employees to the firms success? Do their skills [or
lack thereof] enhance the attractiveness of some strategic alternatives relative to other
alternatives? What is the firms commitment to the work force? How difficult would it be to
expand or contract the work force as market demand for the firms output fluctuates?
• Physical Resources: How difficult would it be to expand or contract the companys
operations, if such is necessary? For example, if a strategy such as build market share is
selected, will the firms plant and equipment be adequate to fill the demand both during and
after the recession?
• Marketing Strengths and Weaknesses: How strong is the brand or product lines
customer franchise? What are the company’s image and reputation among customers? How
does market share compare with that of competitors? How may these strengths be leveraged
and weaknesses addressed before and during a recession?
Source: WARC (Phillips W. Goodell, Charles L. Martin)
57. Checklist for Developing Recession
Marketing Plans
PHASE III: STRATEGY DETERMINATION
• Stance: Given the above considerations and the firms objectives, will the business take
primarily an offensive stance to exploit opportunities and take advantage of competitors
vulnerability, or largely a defensive stance in an effort to survive?
• Offensive Options: If an offensive stance is selected, which potential options present the
greatest opportunity: build market share, innovate, appeal to additional market segments,
diversify product offerings, or enhance reputation for quality or service?
• Defensive Options: If a defensive stance is chosen, which potential options will best
satisfy the firms short-term survival goals: price cutting to maintain volume or cost cutting to
maintain margins?
PHASE IV: REVIEW AND CONTROL
• Relationships: How are vital business relationships with customers, distributors,
employees, suppliers, … likely to change during economic downturns? Are there
mechanisms in place to monitor these changes, as well as an action plan to mend weakened
relationships?
• Damage Control: Have implemented recession marketing strategies met short-term
objectives? If not, how might the plans be modified?
• Position for Future: Have implemented recession marketing plans met long-term
objectives positioning the company for growth and prosperity during the post-recession era?
If not, what modifications of the plans are most feasible?
• Responsibility: Who is responsible for monitoring the implementation and success of the
company’s recession marketing plan?Source: WARC (Phillips W. Goodell, Charles L. Martin)
58. The pessimist sees difficulty in every opportunity.
The optimist sees opportunity in every difficulty.
Crisis…? What crisis?
Past recessions.
How some international advertisers acted
Statement: Recession is not only a loss of money, it’s also a challenge to gain market share
For advertisers, economic recessions create opportunities to buy cheaper media.
Peer pressure works against spending. As companies often allocate media budget in order to maintain “share of voice” in their category
relative to rivals, spending cuts by one part of the sector, particularly a market leader, can encourage others to follow suit - leading to
general deflationary pressure.
Cutting marketing spend in a recession delays eventual recovery.
This is the Chinese Kanji (symbol) for "crisis". It is a combination of the symbols for "danger" and "opportunity". In a crisis situation, we should avoid the danger, and seize the opportunity.
- Studies have shown that spending during recession can be quite effective in growing a brand and ultimately generate a better positioning vs. the competition.
- Spending behind a brand tends to lead to growth in SOM.
- Brands that received support during recession fair much better than their counterparts in the times of recovery (post-recession).
- Spending during recession may put the advertisers a “step-ahead” vs. the competition.
The companies that don't cut their advertising budget during a recession, obtain earnings in market share, sales and profits with regard to their peers that cut investment
Brands in categories which are price-driven (such as petrol, mineral water and apparel) also run a greater risk of losing a market share if
they cut marcoms spending, as individual products are of less importance to consumers. By contrast, categories where price is less of an
issue (such as luxury cars, services and fragrances) tend to be more resilient, as branding assumes a more important role.
Previous Millward Brown research has also found that only 10% of consumers across all categories are exclusively motivated by price, and
even if this figure increases considerably in the face of a slowdown, it is still unlikely to apply to the large majority of consumers. As such,
building long-term brand relationships remains integral even during a downturn, and means that ‘going dark’ should not be considered a
viable option.
This was because while increasing adspend causes a dip in ROCE during a downturn, it offers improved ROCE once the market starts to
recover. Cutting marcoms spending, by contrast, results in lower levels of market share and ROCE when the recovery has begun, as
shown below.
Aumentar el presupuesto de marketing en tiempos de recesión puede causar una menor rentabilidad (medida con el ROCE) en el corto plazo
Sin embargo, en el medio plazo, un incremento en marketing esta ligado a mayores niveles de rentabilidad / ROCE y ganancias de market share
La inversión publicitaria no debería ser un presupuesto discrecional, sujeto a los vaivenes del mercado, sino que debería estar atado a la consecución de objetivos
Consumer insights.
Consumer values change during recessions: more cost and promotion focus, more search of value for money
Some retailers do much better than others. Wal-Mart and TJX clearly remain in the positive, Target also resists with more difficulties.
Stock prices of these firms are likely to reflect this. Wal-Mart trades near a two-year high and is likely to move up further. Macy's, on the other hand, trades near its low.
AdAge.com, 8Oct.2008: “Wal-Mart grinning big (sonríe abiertamente) through the tough times”. Sales, Margins and Stock Price all up. Stock has soared more than 30% in the past year, trading at levels not seen since the turn of the millennium.
After flirting with fashion, organics and sushi in 2006, Wal-Mart returned to its price-focused, downscale roots in 2007. “Save money. Live better”.
Wal-Mart reported 3.1% same-store-sales growth (excl. gasoline) in the 30 weeks ended Aug.29, more than 3 times the 0.8% rate a year ago.
Wal-Mart’s new advertising, customer-segmentation strategies and focus on sharp pricing on national brands over PL have helped.
“The worst of times have traditionally been the best of times for Wal-Mart” (Burt Flickinger, principal of the consulting firm Strategic Resource Group).
Media insight today vs. during past recessions.
Changes in media consumption habits.
Statement: we cannot (always) apply past experience to today’s situation.
Media consumption habits have changed dramatically, mainly due to technology.
Media does not mean conventional media only; new media does not mean the internet only.
Many new media emerged in last 100 years
Based on top 20 Global markets
Increased consumption and, whilst also some cannibalisation, ‘net’ significantly greater media exposure
Change of platform for TV
Massive increase in capability: convergent and interactive
Enormous implications for advertisers. Mass to one-to-one effectively the mass customisation of media
Media evolve towards warmer areas
For advertisers, economic recessions create opportunities to buy cheaper media.
Peer pressure works against spending. As companies often allocate media budget in order to maintain “share of voice” in their category
relative to rivals, spending cuts by one part of the sector, particularly a market leader, can encourage others to follow suit - leading to
general deflationary pressure.
Cutting marketing spend in a recession delays eventual recovery.
CMOs have been early adopters of new media with social computing and blogs receiving the most interest, and instant messaging and interactive TV ads least popular.
Mike Iaccarino, CEO of Epsilon: “Data-driven marketing is an increasingly important component of corporate marketing campaigns as senior marketers employ sophisticated segmentation strategies to recruit and retain customers.”
In a recession, marketers typically cut interactive spending. But our survey of 333 interactive marketers revealed strong support for maintaining or increasing budgets in categories including social networking, email, blogging, and search optimization. Among 12 major categories only online displays ads looked soft. Professional services, financial services, and media marketers are most likely to plan increases in interactive marketing. In a recession like this, marketers should focus on the measurability of their online and social applications and think in terms of building long-term assets, not one-off campaigns to boost quarterly sales.
Behavioural targeting: In comparison to demographic targeting, this method can improve targeting efficiency by 10%.
Rebalance media spending to benefit high-priority markets: Savings can range from 5% to as much as 15% depending on market-to-market skews in spending priority, local media costs and variation in national media delivery.
Reach-based marketing mix models can provide reliable estimates of minimum effective frequency levels by medium. In the absence of a reach-based models, "effective reach" scorecards found in textbooks like "Advertising Communications and Promotion Management," by John R. Rossiter and Larry Percy, help to guide advertisers toward effective reach.
Benefits of “recency planning”: A plan with two weeks of 50 GRP per week can be expected to outperform one week at 100 GRPs by 5% or more.
The spending reduction strategy requires the availability of media mix models, simulation and optimization programs
MARKETERS MUST SHIFT THEIR THINKING FURTHER
While 60% of marketers say that they struggle to build the case for interactive marketing in their organization, it is finally clear that interactive is not an experiment that will go away in a few
years. By 2012, Forrester expects the US interactive market to grow to $59 billion with a recession, or $61 billion if there is no recession. Interactive marketers, we’re pleased that you haven’t taken this recession as an excuse to leave the power of online and Social Computing behind. But you still risk marketing and staffing cuts if you can’t back up your investment plans. Rather than shift channels, you should shift thinking — add measurability to the “must-haves” for these marketing investments.