10.05.08
Marketing in a Downturn: Nothing More Dangerous Than Safe?
If history is any guide, downturns in the market lead marketing managers to take safe bets. We don‘t necessarily mean they cut budgets — many companies have come to realize the benefits of trying to maintain ad budgets during a slowdown — but there is a real pressure to reign in the creative they produce. There is a tendency to tone down marketing initiatives, choose more common marketing channels, and make the creative feel safer. Often, this means pushing for work that feels less edgy, less innovative. Facing rough water, we all share a natural, knee-jerk reaction to pull in the sails, an instinct to censor ourselves for fear of playing too far out of bounds.
At Swink, we argue that this kind of “safe” is actually more dangerous to your brand, and the health of your company, than you might imagine.
The risk is that this reaction can quickly get you lost in a crowd, as more and more companies join you in saying the same safe things in the same safe ways. You risk losing the distinct focus and voice of your brand — the one you have worked so hard to develop and maintain. It may initially feel dangerous to keep the originality and punch in your marketing initiatives, but we believe it is the only truly safe play in a dangerous market.
Good companies stay true to themselves.
Good companies do not hide or abandon their core values during a downturn. They reinforce them, they build upon them, and in the process they can cement their relationship with their customers.
We believe the safe harbors consumers look for to weather economic storms are not bland, neutered versions of the products and services they have come to rely on over the years. On the contrary, there is something reassuring about companies that stand true to their voice and values despite buffeting winds. There is something powerful about the brands that nurture that sense of trust and let their customers know “we’re in this together.”
As a baseline, we recommend to our clients, as they look for direction in 2009, that they build their creative as they always would, with an eye toward their core values and an unfailing sensitivity to their customers‘ needs.
The best companies innovate.
There is a lesson to be learned from entrepreneurs though. Many young start-ups, from Method to Clif Bar, Cranium to Chipotle, have found fertile ground for starting a new business during a market downturn. They find the competitive landscape soft, since most companies take a conservative, reactive position to marketing. There is less competition for media space, and vendors are often willing and eager to take bigger risks on working with new ideas and new people. It’s a good lesson to take to heart, and worth asking — if it can work for start-ups, why not apply the same logic to a working business?
If at any other time you knew your competition was bound to cede ground, pull back, and play conservative hands, wouldn’t you take that as an opportunity to try to grab market share? That is why our best recommendation to our clients is to seize the downturn as an opportunity to innovate — the way you do business, what and how you market, to whom you’re marketing — and gain market share your competition is ceding.
We are of course not suggesting that we can somehow magically market ourselves out of a recession. But if you think proactively, and work aggressively, there are ample ways to lead your company through the downturn and come out ahead of where you began. And isn’t that a whole lot better than sitting back and being buffeted by where the weather takes you?
Update
This topic is, of course, on everybody’s mind lately. As we run across articles that address this issue well, we’ll include them here:
- “The downturn’s new rules for marketers,” McKinsey Quarterly
- “Creative Entrepreneurship in a Downturn,” Harvard Business School