I approach language sometimes with the wary hand of a mystic. There is magic in the words that come from the fingertips (or the mouth, depending on your medium). By saying something you make it so, which is why I've avoided talking about the recession. There, I said it! I've made my contribution to the public discourse of our contemporary malaise.
But, I also feel that the dark magic associated with it might be countervailed on a day when another more powerful, hopeful magic might manifest. That day, of course, is the inauguration. And so, I am going make some suggestions for positive steps that can be taken by both clients and their agencies to weather these hard times.And contrary to conventional wisdom, one of those suggestions involves spending money.
First, the agencies:
Fishermen know that one tear in a net can ruin a whole day's catch. A ripped net means income lost. The days are long and the income uncertain.
For lobstermen in Maine, when the catch is not as it should be, the traps are the first things they need to check more thoroughly.
It is important to note here that those whose job it is to cast nets are not the same as those whose skill it is to mend them. The best boat captains aren't necessarily the best repairmen and builders. Depending on the season and the task at hand, different skill sets are needed.
The same can be said for advertising. And during this season of still and empty waters, all people in the industry, with all of their varying skill sets, need to get together and start preparing -- mending nets and patching boats.
Organizations with the resources and wherewithal to make it through this season should look at improving the contribution they make to the marketplace, which in turn improves their chances of providing value to their clients -- which in turn means the possibility of more business.
Agencies need to start drawing out insight from all the data that they, or their clients, have been gathering. This might involve going outside to data aggregating companies, like BlueKai or NextAction.
Improve your data-gathering tools and push to automate them. Yes, focus on improving the efficiency of the transactional end of your business (trafficking, issuing IOs, and paying bills) by automating it. But when it comes to turning data into information and information into useable knowledge, only humans can perform those tasks. Identify who those people should be and retain them, don't lay them off. And once retained, consider improving their compensation. If you are a public company, consider extending them options. If it is good enough for the CEOs of holding companies, it should be good enough for a smart, hard-working media planner.
All of this will lead to yielding better results and more effective advertising.
2. Keep advertising!
Yes, the news about the economy is bad. The stock market is at lower levels than we've seen in a long time. Unemployment is at 7.2 percent, the highest it's been in a long, long time.
But unemployment was at these levels in the first five years of the 1980s, and again in 1992 (Source: Indiana Dept. of Workforce Development). The stock market is at the same level it was in 2003.
The country has recovered from both. Yes, it can be argued that what is different this time about the downturn is a collapse of faith, rather than a fracture in the fundamentals. And faith is much more difficult to repair. However, the stock market is a crude instrument for gauging the economy, and labor statistics typically indicate where an economy has been, not where it's going. This isn't to say unemployment won't get worse. But it does mean that what's showing up in the news is something that's been in the market for a long time. Even if unemployment hits 10 percent, that means that 9 out of 10 people are still working. Those people may not spend money like they used to, but they do spend.
Advertisers, particularly those who are in categories of "nesting" or "core use" products, should be taking advantage of the efficiencies a soft marketplace yields and affirming or expanding their market share. If for no other reason than to acquire knowledge, advertisers should keep advertising. Marketing has plenty to teach companies about how to successfully communicate their value and increase their business.
The need to keep our industry moving forward does not go away because the economy sours. The sour economy might mean you should be smarter about how to do it, but observing, analyzing, and evolving never stops being necessary to preserve and grow business. An increased focus on accountability might lead to less risky allocations, but if your company was considering testing social networking as a marketing vehicle, a down economy does not mean that you still don't need to test social networking.
Right now, the 92.8 percent of the labor force that is still working isn't engaging media any less. One might argue that now is the time that media is more valuable than it has been in a long time.
CPGs, food and beverage companies, and companies in the entertainment category are at the top of the list of advertisers that should be, well, advertising. People are going to be buying paper towels, beer, SPAM, and DVDs instead of buying cars or houses. These are the kinds of companies that should be advertising. Perhaps the focus on accountability that economic "astringency" brings will lead many of these advertisers online in a greater volume. Let's hope.