by Danny Meadows-Klue
2009 is a horrible year for the advertising industry. There’s no avoiding the cycle of falling consumer confidence, falling consumer spending, lower sales, lower profits and low marketing budgets.
Marketing directors need to urgently focus on a new marketing model. The global recession will trigger a long awaited innovation in marketing techniques and media channels, but the innovation will not be universal. Many brands will fail to change, and deciding not to change means deciding to fail. That failure will be brutal but there is another route.
In any tough economic period marketing budgets usually take the first of the cuts. Many marketing directors in this country are suddenly slashing a quarter or more of their activity. Advertising is cut, product development is cut, sponsorship is cut, websites are cut, staff are cut, sales promotions are cut. And typically the cuts are uniform; everything gets reduced a similar percentage. It’s depressing but increasingly familiar.
For me it’s particularly depressing because it’s the completely wrong response, and one which leads to a further spiral of decline among good businesses. Certainly cuts have to be made, but cutting everything equally means simply doing less of the wrong things rather than more of the right thing. The tragedy for those businesses is that most have not idea they’re making the wrong decision, or that there was even a choice.
Take the car industry. Most of us buying a new car go first to the web to research it. In some markets like the UK that’s been true for 10 years and it would be incredibly unusual to do anything else, but increasingly it’s the normal practice worldwide. We use search engines to find the sites with information, online car magazines to read reviews, online car databases to check prices, online blogs and forums to hear what other people think, and the car brand’s own websites to experience the look and feel. Yes, we still ask our friends in the bar what they think, we probably still see some television and outdoor advertising about cars, so traditional media still has a place.
What’s depressing is that most brands are a long way behind their customers’ behaviour in understanding how media engagement now works. In a customer’s journey towards buying a car maybe over half of the thinking and decision making happens online. Far more activity than the small number of connections a motoring brand can make with consumers through traditional media.
Yet those car companies may put less than 20% of their energy into internet marketing, missing where the customers are in the right mindset and asking to be engaged with. Buy not using internet marketing they:
• Miss talking with customers when they are most interested in the product
• Invest heavy advertising budgets in media that either don’t reach the customer or reach them at the wrong moment
• Fail to fully display their products in the way internet advertising can
• Miss the chance of taking the customer immediately on their next step in the purchase process
The same is true for all product purchases that require research and information. Even if the final sale isn’t made online, the internet can dominate the journey to purchase. From travel products to mobile phones, credit cards to business services, apartments to laptops – the web is playing the critical role. And even for a bar of chocolate or fashion clothing, the web can be the media channel where those customers spend most of their time.
For some brands 2009 will trigger massive innovation. Exceptional economic pressure forces radical change. And for the smart firms, their own brand websites, online advertising, search engines, email and relationship marketing will suddenly emerge as leading tools. In a tough economic climate marketing needs to be effective and accountable. Those tools of impact, measurability and accountability are already in the hands of the marketing directors who are ready to go online, properly. The solution to the marketing challenge is only a click away.