• by Cory Treffiletti , Featured Contributor, April 8, 2009

In an economic downturn of such weight and impact as this, now being referred to as the "Great Recession" due to our love for branding our own historical periods, how does a mass-market consumer brand react to ensure success?

I've been paying close attention to various answers to this question over the last few months, and I've learned there are two distinct camps of response. They are diametrically opposed in process and structure, but each can be successful in its own right.

The first response is to spend, spend, spend. When brands spend during a recession, they do so to take advantage of the lack of spending by their competitors, attempting to increase market share by hammering home product benefits and values. This is an aggressive strategy that can result in a stronger recovery once the rest of the economy catches up. There are much data and many research studies that support the concept of spending during a recession, but what they rarely tell you is that, to do it effectively, you need a strong creative strategy.

Brands that advertise heavily during times of economic distress need to be sympathetic to consumers, focusing attention on product benefits that go beyond the obvious -- emotional benefits, those intangible reasons why consumers make something their brand of choice. To my eyes, two brands using this strategy successfully right now are Pepsi and Audi. Pepsi's advertisements are currently ubiquitous, and even though I'm a Coca-Cola drinker I enjoy the positive message associated with Pepsi's ads. Audi is another example of a high-end brand that appears to still be spending in order to increase the perception of its brand as a premium. When dollars return and the market starts to go positive, Audi will likely gain even more market share.

Unfortunately, many brands that take this strategy resort to a pure media strategy only, just increasing the flow of dollars -- which can result in wear-out for their creative and consumer fatigue. If you're turning up the media faucet during this period, you also need to turn up the creative faucet. Both Pepsi and Audi seem to be using fresh creative during this period, so they're certainly on to something!

The opposite strategy is to reduce spending and focus solely on the baseline of your media. It seems that that when brands take this strategy from a media perspective, they also tend to focus their messaging on price. Selling on price is certainly a strong strategy during economic hardship for targeting the average consumer -- but price can be a dangerous message. Once you focus on price, it can be harder to focus on anything else later.

Price resonates immediately, but it can also shift the attention away from product benefits. The one shining example of where this is not the case is the current Hyundai campaign that offers "safety net" pricing, which ensures you won't be stuck paying for a new car if you lose your job. Though not obviously a price message, it translates to the concept of Hyundai being a great deal all around. The question is, once we emerge from the recession, can Hyundai still go beyond price? My guess is yes, because the message didn't default directly to price -- they danced around it without saying it outright. Brands that are focused purely on price are the ones that I would see in trouble.

Overall, I guess my opinion is quite obvious: spending and messaging product benefits sets your brand up for success. What I suggest you do is become your own advertising anthropologist and focus one eye on the messaging you see around you. Identify the advertisers focusing on price and see if this represents a change in strategy (some brands, like Wal-Mart, have always been about price, and that's all you would ever expect). Also try and determine, with your consumer hat on, whether you would believe a product benefit message later from that brand now that they are focused on price (how would you respond if Wal-Mart started selling premium goods?). It's an interesting exercise and one that will get you thinking.

Let us know your results by telling us on the Spin board!