Monday, 19 April 2010

You'd expect us to say that.....

Interesting piece in the FT Online recently about companies whose response to the recession includes cuts to their marketing budgets - or rather the advantages enjoyed by the companies who don't cut their marketing spends in a recession :

The De Beers "Shadows" campaign, which ran at a time of recession, is estimated to have increased sales by an annual average of 8% over three years. What's more, De Beers profits recovered by 21% in 1993 compared to the previous year.

Renault launched the Clio in 1991, the same year that new car sales in the UK declined by 21%. With advertising awareness of the "Papa and Nicole" campaign peaking at 56%, the Clio delivered increased profit through premium price positioning.

In the 1930s depression, Kellogg's maintained its marketing spend while Post did not. Kellogg then dominated the dry cereal market for the next half-century.

A recent McKinsey study shows how companies who increased their marketing spend through a recession were the only ones whose profit rose substantially coming out of the recession. An interesting paradox seemingly, though we think accounted for in large part by companies maintaining their spend but also demanding a smarter outcome; smarter spend keeps you ahead of the game.

The link below will get you to the FT web page which also hotlinks the McKinsey report.