Marketers: Utilize Media Despite The Economy
I was fortunate to work with a major CPG company for seven years. In training their brand managers, the company reminded them they were not just executing plans for the upcoming fiscal year, but building the platform for success for the next three years.
Three years may seem very far away, give the uncertainty of the recession. It should be noted that the current economic situation is not unprecedented; it's just that most of us are operating in unfamiliar territory.
Consider this: 92% of Americans are employed. The amount of cash in the American economy remains high. It's invested in money market funds (+23% since January 2) and not the stock market. While we're looking at a glass that's almost full, low consumer confidence is causing us to re-examine what we're doing -- and that's appropriate.
Marketers must stay active during this period -- or risk being redefined by their competition.
For example, consumers' changing behavior led to a double-digit increase in the purchase of private label brands in January. In fact, one of the most prominent brand introductions during this recession is the introduction of a new "branded" private label line of products from a major retailer. As a recent Bloomberg report noted, the expansion of private label will not just impact sales during this economic downturn, it will lead to the long term loss of shelf space.
It's not just about getting products cheaper, either. While coupon usage has increased, a recent study by ICOM Information & Communications found younger consumers embarrassed by redeeming them. The study called for marketers of branded products to look for ways to improve value, as they search forthe immediate short term and prepare for their long-term upfront plans.
Numerous studies show that television remains the most productive communications option available to marketers for driving sales. Recent studies by the ARF and MMA reinforced this learning and television has remained important as new technology becomes available.
New technology is contributing to the effectiveness of television. There are many options available to marketers and their agencies, and our conversations with them reveal that everyone is taking a fresh look at their approach to TV. In today's dynamic television programming environment, historical high reach options of the past may no longer be worth the high cost. This is especially true if you want to reach younger and male viewers.
The need to do more with less requires that we better incorporate communications value into our media plans and execution. Recent Fox research found that shorter pods communicate better, yet the network announced that they're walking away from them next year. The insight from this experiment remains important and a deeper look at Magna's pod length study, along with an examination of specific program formats, will show marketers where their messages can communicate better, including a plethora of 60-second pods that yield stronger communications.
We can be sure that next year will continue to bring change. We know that DVR penetration will continue to rise. This will further impact commercial audience, the metric that the television industry uses as currency. Increased commercial avoidance should be a concern for everybody, yet there is programming available today where "live" viewing is the norm and DVR skipping is a limited annoyance.
There is no doubt that the future seems less certain than it did 12 months ago We're all working under different circumstances. We need to recognize that the best solutions embrace our short-term needs as well as prepare us for tomorrow's newly defined competitive environments.