June 3 - 6, 2024
my turn
Commentary
The Recession Impression
- by Andy Mendelsohn , August 26, 2009
Suddenly the conspicuous consumer became the conspicuous coupon clipper.
Bad if you own a Hummer dealership. Good if you own a real value proposition.
I came of advertising age in the 1980s amidst Gordon Gekko, Madonna living in the material world, Donald Trump blow-drying natural colored hair and Nancy Reagan's new policy towards the china cabinet.
I worked on luxury liquors, luxury destinations, luxury magazines and luxury cosmetics.
That was then.
Today, I work on a value-oriented supermarket, a value-oriented tire, a value-oriented restaurant chain and a minor league baseball team that charges less for a great seat than the Yankees charge for a beer.
I work for an agency that has always understood that the vast majority of Americans eschew Kobe for Kraft, Dior for Dockers, and Wall Street for Walmart.
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In other words, I no longer work in New York. And it's been kind of fun to watch big, hip agencies and clients scramble for a way to speak the language of value. Some have suddenly discovered that offering a deal might actually drive traffic. Others have told consumers that if they get canned after buying their products, they'll help with the payments. And then there are those who've suddenly recognized that the nouveau-nervous are a growing demographic and therefore have stopped presenting their goods or services as if they were worthy only of those who have truly arrived.
Because our arrival has been delayed, thank you Mr. Recession. And while we're waiting to arrive, we're all riding coach.
But here's the big question: Do we still want to arrive?
Or have we discovered another place to go?
When the economy swings back into action, when the Dow hits five digits again, when our 401(k) starts to have a little more K, and when human resources departments once again start to use resumes for more than paper towels, where will our priorities go?
None of us can be sure. Hell, I haven't been sure of anything since my financial guy told me 18 months ago that I was well on my way to a comfortable retirement. Let me take that back, I am sure I'll be working at least five years longer than anticipated in order to have a middling retirement.
But here's what I suspect: We're not going back to "gotta have it, God I want it, when will it be in stores, I've got the black one but now I want the titanium one, St. Bart's is nice but Montserrat is nicer" attitudes anytime soon. I think we've learned a little something. And I think we'll stay scared and scarred for a spell.
For marketers and advertisers, I think we'll have to cool it for a while with those "you've arrived" strategies. I think messages that make us feel better about ourselves will succeed. But messages that attempt to make us feel better than others will fall flat on their face. Maybe that's wishful thinking, but we've all been in this mess together for over a year now and folks seem to be craving a good, strong dose of authenticity mixed with reality.
Fantasy is nice. Aspiration is wonderful. But when you've lost your job, when your house is suddenly worth less than the swing set in the backyard, when Madoff made off with your future, when you haven't opened your brokerage statement in six months, you're not ready to shell out for an intangible reward. No, you'll be happy with a balanced checkbook.
And, please understand, this is not bad. This is good. Americans will start spending again, that's what we do well. But I believe we'll start buying with more conscience and less conceit. And we'll continue to market and advertise with a more humane, empathetic, realistic and attainable sensibility.
We'll see how long that lasts.
Andy - good article, but I'm not sure you're analyzing the consumer public with total clarity.
By saying that once the recession is over (markets are back up and people are back to work) we'll continue to tread carefully when it comes to spending, you're assuming that consumers will collectively think "wow, I remember how bad that recession was - I'm going to be more careful from here on out."
But that's just not the way people think. We have very short memories, and like the death of most things (recessions, people, tragedies, etc.) our post-mortem recall is slightly less terrible that our perceived reality during the time of life. We'll exaggerate the past in stories we tell (that's why our grandparents all walked 2 miles to school each day, uphill both directions, in the snow without shoes on), but our actions will tell a different story.
Just look at how many people lost their money in the recent recession because they re-invested heavily in stocks or real estate even after the stock market crashed in the early 2000's. And what about 9/11? It hasn't been that long since that tragedy happened, yet at the airport I hear far more complaints from fellow travelers about having to take our shoes off and the security lines being too long than I hear expressions of gratitude for the steps that have been taken to keep us all safe. How quickly we're able to forget!
We want better times - we want to be less stressed, and we want to be out of this recession. And the media is just waiting for the chance to ring in the "recession is over" chimes. Once they do, and once that wheel is set in motion toward prosperity, it won't be long before people slip right back into old habits, believing our old hype and shedding this recession off of us with a bottle of wine and a trip to the spa.
Jay Miletsky
CEO, PFS Marketwyse
Author, 'Perspectives on Marketing' and 'Perspectives on Branding'
http://www.getperspectives.com
http://twitter.com/jaymiletsky
I agree with both Andy and Mr. Miletsky. Those who didn't lose a job or home in this recession will forget quite soon. but those who did, I believe will always remember and hopefully instill into their children the benefits of spending wisely. I remember my Grandmother talking about the crash and how frugal it made her family to the point she was more frugal as an adult. I didn't lose my job, and I benefited from this mess by being able to buy my first home. I haven't learned a damn thing and neither has my son. But those that I know who lost their dream home to rent a small house, lost their new BMW to drive a used car, lost country club membership and hasn't had a nice vacation this year, will always remember.
Great article & I have to say I'm more in your school of thought re: buying habits post-recession. I think Jay Miletshky brings up some salient points, but there is no modern parallel to what we're going through right now. Not since the Great Depression.
It's not the same now as it was then, but I'm hard-pressed to find a more eye-opening economic time, easily including the 9/11 downturn, than our current mess.
Being fortunate to be very close the my grandparents and many of their contemporaries -- and the ones I knew happened to do very well in their respective lifeworks -- I was always struck by how frugal that all were. Sure there was the occassional exception, but for a great ajority, they were penny pinchers to a fault.
I don't think that's where we are now, but at the same scale in which this recession was not the Great Depression, buying behaviors are going to reflect the black stain on the garment of the U.S. Economy that through which we've lived.
Our past spending sprees were conducted by those that had no memory of what bad can happen in a large scale -- similarly, perhaps the 10 yr olds of today may spend liberally in good time 15 years from now. But I'm more confidant that most people will remember a life-altering economy such as this. We've learned: better times and less stress in no way comes from the smokescreen of a spending glut, as much as it comes from security & knowledge.
A lot of that makes sense, however to survive in the new economy you must position your products and services to be bought and used by those last and least affected by the recession. The affluent still exist, and there are actually more of them then ever before. It all really boils down to an easily solvable marketing problem.