In tough times and at the onset of economic recession, the first impulse for many businesses is to cap spending. Despite the advice of seasoned businessmen to market your way out of a recession, marketing budgets are usually the first to go. It may seem counter intuitive, but a recession can prove to be the best time to build a brand and there are prime examples of household brands that began that way: General Electric (1890), Walt Disney (1923), Burger King (1953) and Microsoft (1975).
The founder of Virgin, Sir Richard Branson, believes that when the going gets tough the tough get going. He told The Times (London); ‘Fortunes are made out of recessions. A lot of entrepreneurs get going in the economic depths because the barriers to entry are lower’. The entrepreneur who got into business at the age of 15 added ‘I’ve seen four recessions, so I’m quite used to weathering these storms’.
A recession can be the perfect business school for an entrepreneur launching a new business brand. The lessons that will be learnt from launching a brand in a recession include:
Resourcefulness – When funds are scarce, you need to think carefully and focus on what is essential.
Judgement – When the stakes are high, it’s paramount that the need for any new product or service is
Commitment – Start-up businesses depend on people who are committed to a shared vision and thrive under pressure.
Timing – A business that starts in a recession will be in pole position when the market improves.
Tenacity – When the going gets tough … the tough get going. A recession can reveal winning qualities.
BRAND SURVIVAL IN A RECESSION
What are the winning qualities for surviving a recession? How do you emerge with your brand in good health? What are the strategies used by some of the hardiest brands in times of recession:
1. Think differently
Doing things differently can create rewarding and memorable experiences. Branding makes it clear to the consumer why a product is better than any other on offer. Celebrate the difference that makes you stand apart from your market competitors. Clarity and focus – be clear about what makes you special and what it means to your customers.
2. Back a champion
The founder or owner must be ready at all times to promote the brand in any situation and set an excellent example to employees and key stakeholders. A confident and strong brand champion inspires team morale and improves investor relations.
3. Appoint ambassadors
Each member of staff in an organisation is a Brand Ambassador, and it’s important they understand the part they play in building its success. The experience they provide to clients is the realisation of the brand. Invest in people – a positive spirit of fellowship and common purpose among employees is essential in communicating brand confidence. Positive employees make positive customers.
4. Make the world a better place
Every organisation, product or service must have a ‘reason for being’ – so identify what your brand does and the benefit it provides, making sure it’s clear and easy to understand. Is your brand relevant to current market conditions? Are you offering value, convenience or well-being? In a recession, consumers and businesses will take great care in how they invest their money.
5. Look to the future
Every organisation must innovate to survive, and can’t afford to stagnate by expecting their customers to keep buying the same products. Sometimes we simply can’t imagine what we want until we see it. Create demand – giving people what they didn’t know they needed but cannot imagine ever having lived without. New products, services and brands can stimulate demand and get people spending.
6. Be clear about what you believe in
A brand’s values are what it stands for and what it believes in; they’re the guidelines that form the organisation’s moral compass. If you hire expensive celebrities or famous talent to champion your brand, you must be careful to monitor their behaviour so that it doesn’t compromise your brand’s values.
7. It’s not what you say, but what you do that counts
Consumers can see past glitzy marketing campaigns and seductive advertising. As the old adage goes, the proof of the pudding is in the eating and actions will always speak louder than words.
8. Offer great value
Great value for money doesn’t just mean offering the cheapest price. A brand can offer value above and beyond the price label, by granting the customer the satisfaction of owning a leading brand. Every organisation can focus on its quality and service levels to offer a higher level of care and durability. A recession affects consumer confidence. A proven track record will pay dividends. New enterprises will need to work hard for credibility. Do what you say and be consistent – loyalty is born of trust.
9. Get to the front of the queue
In a crowded marketplace, it’s difficult to stand out if you’re the seventh best-selling brand. The opportunity is to identify the attributes that differentiate your product and promote your brand as the leader in that category. Positioning places the brand in the front of the queue for the consumer’s attention. A recession can clear out a lot of the market competition and leave the strongest and leanest brands in pole position for success.
10. Community service
By recognising the groups which interact with a brand, you build up a picture of an interdependent community, which includes employees, suppliers, investors, banks, government and customers. This community is never passive, it’s an interactive entity with an interest in the brand. The interest these groups have in the brand extends beyond the ‘buyer-seller’ relationship. The success of Social Media has created a platform for valuable consumer interaction. Brands that listen to their audiences and engage with them develop deeper emotional bonds of loyalty.
Paul Hitchens is the creative director of Verve Brand Consultancy and the co-author of ‘Successful brand management in a week’, the new guide to branding, published by Hodder Education.
Join Paul for a one-day brand workshop in London or Manchester this December:
SUCCESSFUL BRAND MANAGEMENT IN A DAY
A special one-day workshop presented by the author, Paul Hitchens. This fast paced workshop will follow the book with interactive exercises and real world examples. Each delegate will receive a complimentary copy of ‘Successful Brand Management – In A Week’.
© Verve Interactive Ltd 2014