The Wow Factory Blog

Last month’s Kent Business seemed to be full of marketers all extolling the virtues of continuing to invest in your advertising and marketing budget. Now we have all heard this message a thousand times- you know the one, those that continue to spend their advertising pound will be the winners when the bad times turn to good. So I think you are going to be seriously surprised that a bloke who owns and runs an advertising agency says something a bit different, because I don’t always subscribe to that point of view.

Let me articulate clearly; let’s say you are running an estate agency, as a number of my customers do. In our opinion (and theirs) you would be completely barmy to be spending shed loads of your hard earned dosh promoting houses for sale right now. Why? Because even if you found a happy couple who want to buy a house today they probably can’t get the mortgage, so the available pool of customers is small.

When I was a lad the very first thing I was taught, when I began my career at the local newspaper in Yorkshire (on 3 grand a year) was match the budget of the advertiser to the seasonal trends of his customers, ergo for the estate agent, spend money in September because clients are looking to buy then! By and large this theory has stood the test of time, you don’t market houses for sale in December but you do in January, and those that have followed this maxim ain’t done badly.

So how do we get to market and what should we do when according to the media nobody is buying anything at all? The answer, for me, like all good answers is about common sense. Firstly remember the customers you already have, give them special care and attention, what do they need? Are they struggling with cash flow? If so how can you help? How can you add extra value? Is your sales person visiting/communicating regularly? Are you in short marketing to them in the best way there is and ever will be –face to face.

Next, what are you saying to these customers, how are you articulating your message? Are you expressing your unique selling proposition in an innovative and interesting way? Who is responsible for delivering this message? Are the board/senior management involved?
Right now selling more products to existing clients will help enable you to ride out the storm, so generate “cut through”, plan your campaign, think about it, don’t put it to the back of the list of things to do, work at it. Like most things in life the better you plan; the better the result. Think about the routes to market, most of us aren’t national brands, which medium is going to get the most bang for your buck?

Campaigns that always work best are those that incorporate as many opportunities to see/hear/smell/touch as possible. When booking a newspaper campaign, for instance, ask the question how many readers do you have in my catchment area? Marry this to your knowledge of your customers. Are they predominantly female? If so, what is the female readership, are they between the ages 25-34? If so, what is the penetration of the newspaper into this demographic and so on. All local media should have this information at their fingertips, and if they don’t ask yourself why.

When we watch Gordon Ramsay on Kitchen Nightmares he constantly encourages his chef/owner to get on the street and promote themselves, and guess what? It works so copy it! Why not? Sampling a product is a sure fire way of creating advocacy and blimey it costs virtually nothing. So engage with your audience locally, be innovative and help yourself through these tricky times.

Good luck.

The Independent Practitioners of Advertising’s (IPA) latest Bellwether survey has found that the rate of decline of marketing spend slowed in Q1 2009, suggesting marketing budget cuts may have reached their peak in Q4 2008. Business confidence has picked up from the all-time low of Q4, with the percentage of companies believing their prospects have improved rising from 5% to 14%.

Moray MacLennan, IPA President said “This data supports the view that the bottom of the market has been reached. It will be a long road to full recovery, but this maybe the turning point. It’s good to see a graph going in the right direction for a change.”

Although the overall budget cut is still the second steepest decline in the survey’s nine-year history, with spend set to fall again in 2009, the net balance of those reporting an increase minus those reporting a decrease rose from -42% in Q4 to -34% in Q1.

The hardest hit budgets were for main media advertising and ‘all other’ which includes PR, events sponsorship and market research. This is obviously reflected in the Kent marketplace where we have seen significant retrenchment in virtually all media in the county. Meridian’s strategy has been well documented in these pages. Northcliffe Newspapers (Adscene) have closed a number of titles and merged many others. The publisher of this newspaper - KM Group have also closed titles and reduced staffing levels.

Clearly, the revolution in media consumption continues apace, brand and relevance are the key drivers now more than ever in people’s media choice. The development of niche communities and the ability to retain the interest of these communities with relevant articles that appeal to the reader’s predilections are more than ever the “killer” functions. So what does this mean for media owners- they need to (with greater urgency than ever) understand the readers and listeners. In simple words data. Media which collate lifestyle information and exploit it will be in the box seat for many years to come, and most importantly will be able to offer their advertisers a more valuable proposition which will drive the all important yield/rate element for the future. As a marketer these are the basic innovations that I expect as we extract maximum value on behalf of our customers!

Getting back to advertising spend, remarkably, internet advertising suffered a record reduction in spend, but at a far slower rate than total marketing spend*, this indicates a gain in market share now estimated at almost 10%. With classified spend now being almost entirely on line the movement of this vital revenue stream has moved with incredible speed from traditional to new media, leaving print in particular with a massive headache.

Traditional media though should still have a part to play in modern communication strategy, it’s just that it will look very different from the past, specifically the days of pages and pages of cars, jobs and houses are unlikely to return. Estate agents, car dealers and recruiters should plan to use the papers as part of awareness and DR marketing in a similar way to that which retailers have done for years.

*The numbers in the report represent the percentage of companies increasing their spend minus the percentage reporting an increase.

Simon Clubley is a director of The Wow Factory, the Charing based full service agency and can be contacted on 01233 713852 or simon.clubley@thewowfactory.co.uk