Note to radio advertisers tempted to play run-and-hide during this inflation-with-a-chance-of-recession economy: stay the course. That advice comes from Nancy Hill, CEO of marketing communications agency Marcus Thomas, who lays out a plan for advertisers to benefit from the downturn, and its eventual recovery, in a guest column for Ad Age.
“Your instincts might tell you to react to the market and cut spending, to reduce your prices and switch your messaging to sales promotion, [and] that with all the supply chain issues you face, it would be best to stop advertising altogether,” Hill says. “Your instincts are wrong, and history bears this out.”
Key to surviving a downturn economy is, first and foremost, leaving the budget alone. “Cutting advertising spending now is both shortsighted and risky to the brand’s long-term growth,” Hill says. “Those brands that cut their share of voice during a recession end up spending more during the recovery to get back both SOV and market share.”
Instead, Hill says, advertisers should see this as an opportunity for a greater share of voice. “Brands that recognize this as a carpe diem moment realize that gaining SOV during an economic downturn costs less. The same budget you had before the downturn gets you higher SOV as your competitors cut back. And that same budget also gets you more impressions as the cost-per-impression drops. The data shows that brands that continue to invest with the same dollars gain an ROI that more than makes up for continuing to spend.”
What makes this strategy work is making necessary adjustments to media placement or ad content as opposed to spending. “Maintaining your share of messages in the category is important,” Hill says. “Think about shifting your message to account for the very real human experiences that we are facing: higher gas prices, higher food prices, making decisions about what’s considered a necessity. Re-engineer your value proposition to fit the needs of the moment. Make sure that it is a real value exchange for your brand’s customer, so you remain a necessity.”
It's a tactic that makes sense even for products with supply chain issues, says Hill. “Shift your messaging to remind your customers why they love the brand as much as they do. Be useful and helpful. You can still create a value exchange even though you can’t get them the product at the moment.”
For radio, then, advertisers should be encouraged to maintain their connection with target listeners, with the right message for the times. “Creativity for growth is the ultimate value exchange that very few agencies and brands talk about,” Hill says. “There has never been a more critical time than now to ensure that our messaging reinforces this exchange in a tangible way.”