One of the benefits of getting older, as I am, is that one can collect case histories of marketing successes and failures first hand. And the phenomenon of reacting to a sluggish economy by cutting budgets, abandoning marketing strategies, curbing research and reviews, happens with regular monotony. With equally regular monotony, after realising that this is silly, brands start investing again.
The cycle is pretty much predictable and I have seen it happen time and time again.
As soon as things start getting a little tough, brand managers, marketing directors and ad managers react to cost-cutting directives from their boards by putting everything on hold. Perhaps they are far too insecure to argue against cutting marketing costs because they fear that they might be put out to pasture.
They also dare not come up with that old argument about a downturn being precisely the right time marketing should be intensified. (I say intensified, that does not necessarily mean increasing budgets.)
The thing is, after a while boards start wondering why sales are falling. Well, they know that it's because the economy is sluggish. But, then they look at what their competitors are doing.
And that's the time they suddenly call in their marketing people and tell them to get going again. It happens every time. And right now we are going through that "battening the hatches" period.
It will last probably until October this year, when retailers will wake up to the fact that their big season (the last quarter of the year) isn't going to be big at all if they don't start pulling finger. Sure, the Christmas consumer spend might be lower than last year as society feels the pinch, but then the objective is to simply get a bigger share of the available market.
And the way to do that is to do your homework, prepare your strategy based on reality and not wishful thinking and then to make an investment that can be measured.
The point to remember with economic slowdowns and recessions is that some of the world's greatest brands today were born during recessions. Take Microsoft, for example, and a host of others - just Google the question and you will be amazed at how many great brands saw a recession as a time of opportunity.
