Winter 2009 - Issue 11
 
 
In This Issue
 

Giving Brand the Time of Day
 
Much has been publicized recently on effective recessionary marketing - and rightfully so. Although there are conflicting opinions around the merits of marketing investment (or spending - depending on who you ask), industry leaders agree that all companies/brands want to emerge from this recession in a stronger competitive position.

The question facing us all is how. The following article discusses efficient brand innovation opportunities and the dangers (as well as alternatives) to price-cutting.

The recession will give organizations an opportunity to innovate and gain competitive advantage.

Marketers agree: marketing return on investment (MROI) is especially critical in today's recessionary economic times. Knowing this, the question becomes what is the optimal mix of short and long-term marketing initiatives to maximize MROI?

Recessionary times or not, customer-focused organizations drive decision making with consumer need/insight. Once market insights are mined, strategies can be developed and put in-place delivering value for customers. Although this is the ideal marketing process, shrinking budgets and manpower to execute these initiatives is forcing many marketing professionals to delay long-term branding initiatives and focus on short-term marketing tactics - advertising cuts, price reductions (discussed in next paragraph), and direct selling (see 'Top 10 E-communications Best Practices' for more insights on this topic).

A recessionary economy gives companies the opportunity to innovate and try new media and marketing programs. For example, Virgin Mobile mined customer insights around the recession and built a 'screw you recession' campaign that not only connects, but engages consumers by having them share day-to-day money saving tips (Hey, recession, take that! - www.theglobeandmail.com). It is interesting to note how many companies are taking this opportunity to build customer interaction and connection through dialogue about innovation and economic challenges.

Price-cutting in recessionary economic times can have disastrous effects on brand equity.

In-line with marketers need to deliver short-term business results, an immediate option for marketers is to reduce price to boost short-term revenues and reduce inventories. Although this looks good on the balance sheet, the long-term impact of price-cutting can be detrimental to years of brand equity building investment.

Starbucks recently added packs of instant coffee to its menu of choices, for $2.95 consumers can enjoy three cups of instant Starbucks coffee (~$1 a cup) - a far cry from the price that can be charged for a single cup of Starbucks house blend. (Just add hot water: Starbucks to sell instant coffee - www.cbc.ca). Starbucks has positioned itself on being the finest purveyor of coffee in the world, although this lower price point should drive new traffic in the short-term, it will likely be detrimental to the brand in the long-term.

In a Strategy Magazine (Feb 2009) article, Ken Wong, Associate Professor of business and marketing strategy at Queen's University, states that although price is important, companies can find other ways to offer customers additional value by increasing their 'quality' of offering. For example, offering better financing for vehicles (just as GE financed refrigerator purchases in the Great Depression) or providing free gas (both money saving offerings) to car buyers will boost customer 'benefit', thus enhancing the value proposition (Marketing in a crap economy - www.strategymag.com).

The long-term impact of price-cutting and delaying customer innovation can be detrimental to brand equity, while the costs of re-building brand are substantial and sometimes unattainable. Companies can continue to build brand equity by innovating through customer insights and offering a more powerful value proposition (without price cutting).

Participate in the Dialogue

In our upcoming Marketing in a Recessionary Economy Expert Panel discussion (see Upcoming Events below) and subsequent white paper, we will discuss brand building strategies to ensure brands weather this economic storm and remain poised to build market share in stronger economic times ahead. We invite you to participate in this discussion by filling out a quick marketing survey.


Top 10 E-communications Best Practices

In times of economic turbulence, marketers need to be more innovative and efficient with their marketing programs. E-communication is a relatively inexpensive communications tactic designed to reach priority target audiences. When the piece is anticipated, relevant, and personalized for recipients, it can add value and help push targets through the sales cycle with a strong ROI. Below we outline the 'Top 10 E-communications Best Practices', these insights were pulled from recent publications (blogs, articles, etc) as well as from our own experiences.

  1. Make it personal. Since email is already considered an impersonal communication channel, e- communications that tell stories or discuss recent happenings helps remind recipients that it was written by a real person (thus making it more memorable and credible).
  2. Give recipients the opportunity to unsubscribe. If recipients do not want to receive the e-communications piece but cannot easily unsubscribe then the overall brand experience will be very negative.
  3. Make sure it is relevant. E- communications audiences are becoming smaller groups of like-minded individuals. Segmenting contacts by 'like-minded' information needs is an effective way to ensure that recipients find your e- communications value-added.
  4. Reach out to targets with news. If you have a re- branded website or if a piece of news or research surfaces supporting your product, then it should be communicated to those who will find it relevant (or interesting). Of course, these communications must be managed to ensure recipients continue to find your e-communications valuable.
  5. Know your audience and BlackBerry-proof your message accordingly. With over 60% of Executives owning a BlackBerry, it is important that e- communications targeting this segment be clear and concise, written in a small font, and free of intricate formatting to ensure key messaging is delivered.
  6. Re-think measurement techniques. The traditional measure of 'open rates' for e-communications is no longer indicative of total exposures as BlackBerry views and preview panes are not accounted for with this measure. Instead, marketers recommend using end-goal metrics, for example the number of new subscribers to measure effective reach.
  7. Have one clear call to action and ensure it is supported. Although a call to action will be ignored by many e-communications recipients, it is necessary as it will push a select few 'higher potential' targets through the sales cycle. Accordingly, it must be easy for recipients to complete the call to action (ie. Include relevant links, contact information, etc).
  8. Appropriate timing is key. In-line with keeping communication relevant, e-communications must be deemed valuable by the recipient if they are to answer the message's call to action.
  9. Subject first in subject line. Ensure the subject of the email subject line goes first followed by action required. For example, if you are developing a white paper on topic of brand building in a recessionary economy, 'brand building - your input' should be the first thing in the subject line.
  10. Measure, measure, measure. Track activity (including web traffic and dialogue) resulting from all e-communications. This additional information will be critical for any follow-up communications, ideally within the first 48 hours when 70% of the responses are expected.

At the end of the day, the overarching goal of most e- communications is to inform your contacts and where relevant move as many as possible through the sales cycle, while alienating the least. With this in mind, all aspects of e-communications (the messaging, timing, formatting) must align with the best interests of recipients in order to deliver a positive brand experience.

Upcoming Events


American Marketing Association, Toronto, May 28th. Brand Matters will be moderating a discussion amongst industry leaders on the topic of Marketing in a Recessionary Economy: What it Takes to Win. We invite you to input to the discussion by completing a short marketing survey. Alternatively, contact us to get more information on registering for the event.

This newsletter is published by Brand Matters, a brand consulting firm that specializes in market research, brand development, mar-com planning, internal branding and implementation. With Patricia McQuillan as President and Founder, the firm has delivered success-driven results for a variety of renowned organizations since 2000. This newsletter was sent to friends, clients and associates of Brand Matters Inc.
 
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