Post-recession branding: What Next? Part 1
One year on from our research on Recession-Proof branding, we did a follow-up to ask "what comes next?". To help us do this we carried out quantitative research with over 60 marketing directors from top companies. We covered a range of sectors, from hotels to fast food, and regions including the USA, Europe and Latin America.
Here in part 1, we look at headlines on the following areas: i) Surviving and thriving: impact of the recession on brands and ii) the first two of four recession-proofing strategies companies plan to adapt for the long-term: sharpening positioning and boosting distinctiveness.
Part 2 later this week looks at getting the right balance between core brand growth and brand stretch, and conclusions.
1. Surviving and thriving
Our research confirmed that that the recession has hit brands hard, with 57% saying the effect in the 12 months has been bad or very bad. However, there are early signs of progress, with 15% expecting a positive effect from the recession in the next 12 months
Some brands are thriving because they are in recession-proof categories, such as fast food and discount supermarkets. More interesting are brands who are growing by taking share in markets that are under pressure. For example, Hyundai has bucked the trend in the US car sales in a market that has suffered a disastrous downturn, with sales down 39% in 2009. The brand almost doubled market share from 2.4% to 4.1% with the Hyundai Assurance program. If you buy a new Hyundai and if you lose your job, the automaker will make the payments for you for a while, and then buy back your car.
2. Leading brands out of the recession
Leaders plan to adopt the key recommendations from our last paper on Recession-Proof Branding as long-term growth strategies. This confirms our belief that the recession is a wake-up call for marketing, forcing a more practical, bottom-line focused approach to branding we call "follow the money". Four approaches stand out, selected by 90%+ as strategies using during the recession that will be used longer-term. These are sharpening the positioning, growing the core, boosting differentiation and fueling the fan club of employees and consumers.
This is seen by everyone as important for leading brands out of the recession, being the key tool for inspiring and guiding effective marketing. Hovis bread is benefiting from sharpening and communicating their positioning, growing share from 22.2% to 25.1%. Emotionally involving communication is reminding us about the brand's 122 yeas of heritage, with a return to the slogan that made it famous: "As good today as its ever been". The ads also feature the original, un-sliced (and heavily branded) "little brown loaf".
It was encouraging to see that leaders shared our view that now more than ever is the time to have the courage to create brand mixes that cut through the clutter. An example is T-Mobile's integrated "chapters" of marketing activity centred on spontaneous, large-scale and interactive "happenings". This approach is helping them stand out from in the mobile network market and get across the brand idea of "Life's for Sharing" and generate masses of free publicity. The "Dance" film, with 300 dancers getting the whole of Liverpool Street Station to boogie, has been viewed over 11 million times on YouTube, and generated a significant increase in traffic into T-Mobile stores.
The next post will cover the role of growing the core and fueling your fan clubs.