Sunday, May 1, 2011

The Great Depression

Changed the spending habits of a generation and the current recession has left consumers reaching beyond the attractions of luxury searching for value-driven purchases. All this has been great for mass and value driven purchases, however many premium brands are feeling great pain!

Companies must create opportunities to connect with customers on a personal level. This will afford you insights into their perspectives, motivations and needs.

It can be said that innovation is the hallmark of a premium brand. Constant development and improvement distinguishes market leaders from their competitors.

The problem is...as ever...advertising! Generally speaking the non performance of advertising is an indictment of the entire advertising industry, with its failure to communicate...to anybody!

But achieving nothing has not come cheap, total advertising expenditure in the UK passed £19 billion in 2006. At a time of public austerity, this looks like a clinching case for a thorough re-examination of the entire way we market to customers.

From the early years advertising was beset with confusion, who does not remember “50% of my advertising is wasted...”
Nowadays there is an increasing body of evidence that large advertising campaigns do not work.

Advertising together with Marketing are battling many countervailing forces, on-line;digital; clutter (or meaningless noise); selective perception together with many more.

It may not be that it is a waste of time. It just maybe that it is tougher than expected and more expensive than we can afford. Advertising now has to target resources more effectively and, at the same time, obtain a better understanding of the word “communication”!

Product features, narrow product benefits, together with proprietary claims are no longer enough to sway consumers who are much more value driven. They have taken control back from marketers and will only engage with brands on their terms. Consumers have been reluctant to spend beyond a tightly defined set of needs that has become increasingly narrower as the economy continues to stagnate.

Without a doubt the biggest challenge to National Brands is Private Label Store Brands, consumers see less difference between the quality of store brands and well-regarded name brands, thus there is less incentive to pay the premium that name brands carry. Now with Interactive Communication your brands can fight parity by putting relevance first as a means of differentiating themselves.

Marketing professionals tend to prescribe remedies that lie within their own competence.  Marketing is about perception not substance and is essentially short term, aiming to turn perceptions around within at most a couple of years, and uninterested in the problems that perception unmatched by substance may finally bring.

It is therefore not surprising that the communications industry has majored on inspiration, passion and novelty for they are the cocaine of image making delivering a sharp, optimistic and immediate kick.

Afterwards comes the cynicism, the disappointment and the disregard.  Hence the need for Clients in 2010 and on, to feel the need to “send out a message”  But if they really understood communications, rather than the fashionable industry patter they will have to start at the beginning and understand the word “interaction”.

The writer has, for some time, been highly critical of the vanity of the advertising class in perpetuating the myth “advertising works” but recent reports published has shown that the poverty of decision making extends into the Marketing community as well! Even more worryingly the Advertising and Marketing Community have yet to show any departure from the hoary mantra “Advertising works” it must depart drastically from the mistaken belief that creativity is the sole criteria to the success or otherwise of Marketing Campaigns.

Now onto “Brands”. The only thing on which everyone will agree is that Brands and Branding are part of our culture, society, economics. Politics, science and all of human history. They are everything and everywhere.

Whatever!

Now word has it that retailers are cutting back on the variety of Brands they offer in various categories so it's going to be harder to get various permutations of your brand on shelf! However one can't get away from the fact that a lot of Branding is focused on Customer wants, not needs. Thus so much of Marketing spend has been about Brands and not about reality. So is it surprising when Customers reject paid media and value the social stuff. It is more than possible that we haven't been giving customers any information that they think is worth anything!

As we have stated elsewhere the economic crisis is due as much to marketing failures as financial ones!This sense of declining effectiveness is due, in part, to an earlier perception that over-estimated advertising's power. In the industry's days of dominance, peopled believed it could change the ways consumers think and behave, not just influence them to favour one brand in a category they were already considering.

Much of this sense of advertising's enormous power and the almost inevitable effectiveness of image advertising grew as mass advertising followed mass manufacturing in the 50s' and ‘60s. Mass manufacturing led to one-size-fits-all products. Local, individualised, and speciality products disappeared, and the mass consumerism was achieved via mass advertising.

Now, customised products are coming back. Modern manufacturing has attained the ability to replicate, in its own way, the old world of choice.

Products are modified to meet many different consumer needs, including diet, health, ecology and economy among others. This technological revolution in manufacturing has made every vendor customise his product line.

Taking the place of undifferentiated brand products are various related lines of different choices for a consumer to select among. In this situation, our ability to sell everything under the umbrella of a single brand image has become limited and suspect.

How much can an ad lacking information really accomplish? Brand image is no longer the be-all and end-all of marketing.

With this vast differentiation, especially with high-ticket items and durable goods, buyers are looking for more than brand rhetoric. Whilst consumers still buy candy bars or sweat socks casually, as we should, without great forethought or analysis. Consumers buy important expensive durables only after they have properly processed the information they need.

One of the major sources of that information is - or should be - advertising.

Here's the problem: Image advertising doesn't give us the information needed to buy knowledge-driven products. Since it doesn't help us, we have long since acquired the habit of tuning it out.

There is another aspect of advertising today that contributes to its crisis of confidence among marketers.

While marketing accepts that significant effort must be paid to retaining a brand's current customers, too many advertisers consider such efforts boring and insufficiently creative - not something fundamental that needs to be done year in and year out.

The result of this thinking generates advertising that is all image and no content, designed for a mission that many regard as futile - the search to transform non-buyers into first-time buyers in the name of market expansion.

Marketers recognise how much has changed since the 1960s. For one thing, consumers do not pay attention to advertising the way they used to. The average British adult is already bombarded with 3,000 marketing messages a day. So it is well neigh impossible to get any one message noticed or remembered amid the entire clamour. One of our real concerns is that we have an inability to stand out.

With good reason; market research shows that viewer retention of television commercials has slipped dramatically in the past nine years. In 1986, 64% of those surveyed could name a TV commercial they had seen in the previous four weeks. In 1995, just 48% could. And in today's difficult and hostile market place the situation is much worse.

Even when consumers do notice an ad, they are less interested in the brand message it conveys. Consumers once clung to brands. They were Pepsodent households and Colgate households, families that washed with Persil and ones that bathed with Lux. And the characters Charlotte Street dreamed up to sell brands became pop-up icons.

Now, many British brought up on a steady diet of commercials, view advertising with cynicism or indifference. With less money to shop, they are far more likely to buy on price. And they are a lot less smitten by Kellogg's or Heinz.

Advertising is clinging to a world that existed ten years ago as if it were trying not to notice it's vanished. Advertising has to modernise and change.

Its effectiveness will regenerate itself because the information content of advertising is a fundamental necessity for the efficient conduct of a complex and free market place.

Instead of asking, “When are the good times coming back?” we should be applying ourselves to doing advertising in ways that are right for the time we live in...

About the Author:
A substantial research investment has proved conclusively that one exposure to an interactive "event" is far more effective in all key measurements, than traditional advertising. Interactive Communication, properly executed, can be totally accountable, unlike all other forms of advertising! You can contact Paul at: mailto:pl.ashby@gmail.comhttp://interactivetelevisionorinteractivetv.blogspot.com or: No. of Times this article has been viewed : 354
Date Published : Feb 25 2011

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