Importance of Marketing in Today s Economy

Importance of Marketing in Today’s Economy Why advertise How to advertise Where to advertise Overview • • • Why advertise How to advertise Wher...
Author: Jared Ferguson
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Importance of Marketing in Today’s Economy

Why advertise

How to advertise

Where to advertise

Overview

• • •

Why advertise How to advertise Where to advertise

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Why advertise

How to advertise

Where to advertise

Why advertise.



Consumers don’t go away during a down economy, they grow more selective. Businesses should take advantage of the established relationship between share of voice (SOV) and share of market (SOM) because: – Stealing market share is a bargain during recession – Maintaining promotional spend sustains or even grows market share as other companies may withdraw spending – Encourages brand switching to cost-saving alternatives – When a brand’s share of voice is greater than its share of market, it’s likely to grow market share In a study of U.S recessions, results showed that aggressive advertisers’ sales rose 256% over those that didn’t maintain their advertising.

• •

Share of voice: A brand’s advertising weight expressed as percentage of a market segment Share of market: A company’s proportion of the total market

Source: McGraw-Hill Research Study, 1980-1985

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Why advertise

How to advertise

Where to advertise

Advertising maintains and grows mindshare.



“Many marketers spend the same — or even more — during hard times as they do during booms, on the theory that they must make sure to be remembered by any consumers who are still shopping. And advertisers in competitive categories like automobiles, beer or fast food are reluctant to cut spending if their rivals are not.” – NY Times, Jan. 28, 2008

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Why advertise

How to advertise

Where to advertise

Historically, challenging economic times have provided opportunities for businesses to gain market share.

• • • •

Sears stole the market from Wards during WW2 Kellogg beat Post during the depression Revlon and Phillip Morris gained share in 70’s recession while Avon and Hershey lost share Taco Bell and Pizza Hut stole share from McDonalds during 90-91 recession Bottom line – cutting ad spend during a down economy only helps short-term profitability and does not position your business for long-term results.

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Why advertise

How to advertise

Where to advertise

How to advertise.



Concentrate on core values – Reinforce brand values by demonstrating strong consistency of message



Maintain or increase spending and share of voice – Data clearly validates the connection between increased spending and increased market share



Start sponsoring – Events, cross-promotions, cause marketing ... anywhere the brand message can be spread



Adjust your product mix and messages to reinforce their value during tough economic times

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Why advertise

How to advertise

Where to advertise

Maintain your focus on four things.

1. Your competition 2. Your brand 3. Your customers 4. Your communication

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Why advertise

How to advertise

Where to advertise

Include value message in your advertising.



Leverage consumers’ concerns in your advertising by promoting value: – Value items, lower-priced products – Offer specials or coupons – Pitch the value that your products bring to them and the affect on their pocketbook (Quality, customer service, etc.) – Customer loyalty programs – Special events – Price matching In a recent ICOM survey, results showed that two-thirds of shoppers plan more coupon use during a down economy – 71% of 18-34 year olds and 68% of 35-54 year olds.

Source: ICOM Information and Communications, April 2008

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Why advertise

How to advertise

Where to advertise

Local examples of advertisers addressing consumers’ concerns.



TDC Interiors - Previously focused on value driven consumers vs. price driven. Current economy has motivated them to expand their customer base by moving to a price and quality driven message. New campaign offers 4 yards of fabric for the price of 3, in addition to 3 additional years on their warranty



Affordable Barstools & Dinettes – current offer includes paying the sales tax and free delivery. In addition, they have expanded their product line to include more affordable products and added more storefronts



PODS (portable storage sheds) – current offer includes the 1st month for $1 driving customers to their door and generating long term revenue for the subsequent months



Sauce (Fox Restaurant Concepts) – Every year they increase the price on the pizza, salad and 2 glasses of wine special – this year they won’t "Consumers don't stop buying when economies go though down cycles. They look harder for value," said Saatchi & Saatchi's Kevin Roberts, writing for Advertising Age magazine. 9

Why advertise

How to advertise

Where to advertise

Consistent advertising positions your business for the economic recovery.

• • • •

Maintain the confidence among your current customers that you’ll be there when they are ready to buy. Maintaining market identity costs less than rebuilding it later on Prevent the loss of customers to your more aggressive competitors Capture market share from those competitors who have cut back Place your call to action in front of the consumer when they are ready to buy

65% of surveyed executives plan to keep marketing budgets “status quo” in challenging economic times – 25% say they would “pump more money into their brand” in a down economy.

Source: Devito/Verdi Survey, 2008

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Why advertise

How to advertise

Where to advertise

Where to advertise.



Republic Media: – Provides an engaged audience of more than ONE MILLION adults everyday – Delivers an affluent audience – Outperforms any other media

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Why advertise

How to advertise

Where to advertise

Republic Media can help drive customers to your business. • • •

One ad in the daily Arizona Republic reaches 910,900 adults in the Phoenix metro – 30% of the market One ad in the Sunday Arizona Republic reaches 1,175,600 adults in the Phoenix metro – 40% of the market 7 days on azcentral.com reaches 548,600 – 18% of the market

Just one ad in the daily and Sunday edition and 7 days on azcentral.com reaches 1,568,800 – 52% of the market!

Source: 2008 Phoenix CBSA Scarborough Release 1 (Feb 07 – Jan 08)

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Why advertise

How to advertise

Where to advertise

Republic Media reaches more than 1.7 million adults in a week.

2,000,000 1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0

1,775,400 1,591,500 1,075,500 910,900

291,900

30% market reach

36% market reach

10% market reach

Daily azcentral visitors

Daily Arizona Republic

Daily Footprint (print and online)

548,600

53% market reach

59% market reach

18% market reach

Past 7 day azcentral

Past 7 day Arizona Republic

Past 7 day (print and online)

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Why advertise

How to advertise

Where to advertise

Republic Media daily and weekly footprint increased YOY Together print and online are reaching more people than ever before. +5.9%

2,000,000

2007 R1 2008 R1

1,750,000

1,676,100

1,775,400

1,500,000 1,250,000

+3.5%

1,038,800 1,075,500

1,000,000 750,000 500,000 Daily Footprint (print and online)

Source: 2008 Phoenix CBSA Scarborough Release 1 (Feb 07-Jan 08)

Past 7 day Footprint (print and online)

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Why advertise

How to advertise

Where to advertise

Republic Media provides an affluent audience less affected by a down economy.



Arizona Republic readers and azcentral.com visitors have higher than average discretionary incomes giving them more purchasing power than the general market. These readers are more likely to purchase your products! – Arizona Republic readers ƒ 46% of Arizona Republic readers have HHI over $75K ƒ 82% of Arizona Republic readers own their own home – azcentral.com visitors ƒ Median HHI is $83,680 – 35% higher than the overall market ƒ 81% own their own home

Republic Media reaches 69% of households with $75K+ incomes over 5 times per week.

Source: 2008 Phoenix CBSA Scarborough Release 1 (Feb 07 – Jan 08)

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Why advertise

How to advertise

Where to advertise

Republic Media continues to outperform other media. Percent reach among households with HHI over $75,000/yr

63% 52% 46% 37%

One ad

Sunday Arizona Republic One ad

*Sources: 18+ Arbitron, 2007 winter book & Scarborough Phoenix Market Study R1 (Feb 2007 – Jan 2008); primetime TV = 2 ads on top five stations per week (10 primetime ads); radio = 5 ads on top 5 stations per week (25 ads)

18%

Daily/Sunday Arizona Republic One daily one Sunday ad

28% 18%

Primetime TV Radio

18%

28% Primetime TV Radio

Radio

Primetime TV

18%

azcentral.com Daily Arizona Republic

One week

28%

Radio

28% Primetime TV

12% Radio

Primetime TV

28%28%

Daily/Sunday Arizona Republic, azcentral.com One daily, one Sunday ad, azcentral.com

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