Thursday, January 29, 2009

Love fifteen

So I was at the Australian Open tennis on the weekend and I was thinking about big corporate sponsorships. Fresh data (Roy Morgan) shows Kia and Garnier dominating sponsor recall with non-sponsor adidas coming in 3rd ahead of everyone else (GE Money, Aviva, Evian, to name a few).

Most of the sponsors had experiential elements - there was an hour and half queue to get into the Garnier pamper experience.

What I didn't see though was anything except naming rights, sampling and experiential. I didn't see any offers, any promotions, anything encouraging me to get involved or visit a website.

Seems to me that these brands should think a little more about what happens after the 14 days - how to turn their sponsorships into something more long term, something more involving and interactive. I like Carling's UK sponsorship of music venues in this respect: they took over multiple venues in major UK cities permanently, rebranded them Carling Arenas, served the product, changed the ticketing so you can only book through Carling website...and so on. That is a more long term and effective strategy where they clearly own a very big meaingful piece of the real world all year.

I certainly didn't come away from the tennis thinking I had a more meaningful relationship with many of the brands. Has anyone got any favourite sponsorship case studies?

Tuesday, January 20, 2009

Advertising spend in tough times

As Access Economics put it yesturday ‘The Budget is Buggered; this is the sharpest deceleration Australia's economy has ever seen”.
But it is not all doom and gloom. Australia is actually in a good starting position to weather the storm:

  • Australians have more cash in the bank than ever before (credit card payments up 19.2% YOY)
  • The unemployment rate is at its lowest in 33 years
  • The price for oil is half of what it was this time last year
  • Interest costs on mortgage repayments are down $100/month vs. last year
  • Rudd’s just given Aussies $9bn X-Mass cash bonus

There is a range of research that shows there are opportunities for brands to endure - even prosper - amid the coming downturn.

From a media perceptive we know that tumultuous times usually mean people and advertisers will revert back to traditional media, such as newspapers and television. Consumers will turn to the media that they trust. Source: Newspaper Marketing Agency UK, based on survey of marketing & advertising leaders 2008

They will also seek brands they trust. Consumers will be more thoughtful in their purchase decision making – they will investigate, research and compare when buying; more so than they do in boom times. Iconic brands, those that offer value to consumers and “innovators” will triumph over luxury brands and “me too” labels.

When stress goes up, so does stress release. People are seeking relief, comfort & security. Brands that provide this will prosper.

Brands that show empathy will also go a long way right now. All the car manufacturers are not in a great position at the moment, the current Holden ads do make some effort to empathise with their line “Holden’s are tough but Australians are tougher”…to some it may be a bit soppy but it does acknowledge tougher times.

At a December 2008, Financial Crisis and Consumer Behaviour seminar hosted by Colmar Brunton they presented 3 ways to grow in 2009 – underpinning all of them is staying close to your consumer & demonstrating empathy.

  • Innovation & NPD – e.g. Sainsbury’s in the UK did a “feed your family for a 5er” promotion that went gangbusters. Unilever & Kraft in the UK are partnering to provide consumers with cross-category value promotions
  • Brand communications – e.g. Virgin air, premium economy is benefiting from business class travellers downgrading. They’ve also released “tighten your seatbelt” $45 flights with Virgin Blue
  • Customer experience & Optimization – e.g. Westpac “how is the financial crisis affecting my savings” promotion

A UK seminar held in July 2008, three months before the world financial crisis began, investigated the most profitable response for advertisers is during an economic downturn. The seminar, whose proceedings have been published by the IPA (the professional body for advertising agencies in the UK), proves that it pays to advertise during a recession.

Australian research by Milward Brown supports these UK findings, showing that budget cutting is liable to reduce consumers' `bonding' with the brand. Cutting budget in a downturn will only defend profits in the very short term.
The longer-term improvement in profitability is likely to greatly outweigh the short-term reduction.

Buying Share of Voice is effective in terms of both costs and branding. The heightened share of voice leads to increases in consumer preference, and in sales and profitability post-downturn.
It is better to maintain share of voice (SOV) at or above share of market (SOM) during a downturn.

Ultimately the brand will emerge from the downturn weaker and much less profitable if not supported.

If other brands are cutting budgets the longer-term benefit of maintaining SOV at or above SOM will be even greater. A recession provides a window of opportunity for inexpensive gains in market share for those brands which increase marketing investment during this time.

But at a time when every area of the business are being asked to cut costs it is imperative to justify any expenditure.
At OMD our econometrics offering can demonstrate the direct impact of marketing activities on sales. Further to that it can isolate the sales impact of each of the channels allowing us to optimise those that are moving products most cost effectively.
Marketers that can show ROI of their marketing expenditures have strong case to hold on to their budgets.

To summarise OMD’s top 5 tips for 2009 are;

  1. Consumers will be more thoughtful in their purchase decision making – they will turn to brands they know and trust.
  2. Talk to the consumer’s emotion. Empathy is key. Show them you understand they are struggling and show you can offer them “value for money” or an escape.
  3. It is important to continue to have long term focus – continued or consistent spending now will set up brands for the growth cycle that will be coming.
  4. It is better to maintain SOV at or above share of market during a downturn, as there is an opportunity for inexpensive gains in market share for those brands which increase marketing investment when others are decreasing theirs.
  5. Really know which marketing activities provide you with a return – evidence that marketing spend shows both short-term and long term returns for the business will help protect your marketing budget.

Slow Blogging


A term used to describe anyone with enough time or narcissism to document every tedious bit of minutia filling their uneventful lives. Blogging - as defined by Urban Dictionary

While I like reading others blogs, is everyone having access to write the first thing that comes into their heads that great an idea?

David D. Perlmutter, author of Blogwars, has called for a movement called "slow blogging". His manifesto can be read here

The practice is inspired by the slow food movement, which says that fast food is destroying local traditions and healthy eating habits.

David Perlmutter writes “Slow Blogging is a rejection of immediacy. It is an affirmation that not all things worth reading are written quickly.”

I actually like his tips which include;

All of them can be found here

Slow Blogging is about letting thoughts marinate (some we as strategists like to do with ideas away). Really what he is saying is think before you post

I also thought this trend (if we can call it that) was interesting in light of the buzz surrounding Twitter, mainly in the US. Which some seem to think is the best & biggest thing since say Youtube.

I think the Blogging defination at the start of this post better describes Twitter - it is all about 'the instant' - what is happening right now.

May be because I am older than 20 that I quite like the idea of being considered about what is shared with & by others and don't feel the need to up date everyone, on what I am doing, at every minute of the day.

Not that I am a technophobic, I just use those technologies that seem to add value to my life with changing it drastically.

From a media perceptive it is like we say 'it's is not so much about the channel or delivery device but the consumer'.

p.s. After writing this I hope I have pondered on it long enough before posting it and have not raised the bar to high for future posts

Monday, January 12, 2009

Guide for the Value Hunters

It must be a sign of the times. I was enjoying my Sunday Herald Sun over a cup of coffee yesterday when I came across a new editorial page - Value Hunter.

I discovered Value Hunter is a new consumer advocacy page that will run in the News Ltd Sunday newspapers. News Ltd state the aim of the page is to "provide practical information on how to save money".
Consumer rights is not a new editorial theme - it would be about half of the stories that run on Today Tonight's - but the information to help save readers money, in the form of a regular page is surely a reaction to the current economic climate.
Sunday's page including stories such as 'How it pays to save', which included tips to live with in our means, 'Haggle hard for bargains', and 'Cheap ways to entertain the kids'.

For advertisers there is also a strip ad placement on the page carrying a Value Hunter discount offer.
You can look out for ways to save money in your Sunday Herald Sun/Sunday Telegraph next week or visit the Value Hunter blog.