JWT’s AnxietyIndex is designed as a place to discuss how brands and consumers are responding to the global recession. With daily content updates, AnxietyIndex.com includes contributions from around JWT’s network, offering a truly global perspective.
BMW’s recent shift away from its longtime tagline “The ultimate driving machine” to “Joy is BMW” looks like a savvy way for the luxury brand to remain relevant to post-recession consumers. In a release, BMW marketing VP Jack Pitney explained: “All of our efforts in engineering, design and technology are about one thing, which is creating moments of joy” and said the campaign focuses on “sharing those moments in an upbeat, humanized and refreshing fashion.” In other words, a cool car isn’t an end in itself. The visuals reinforce this, with ads showing more people (real BMW owners) than vehicles.
The North American campaign, emphasizing that “what you make people feel is just as important as what you make,” is at the opposite end of the emotional spectrum from one focused on performance and engineering. Which is about right, considering that “People now want to lead a richer life, rather than a life of riches,” as Madelyn Hochstein of DYG, a market research firm working with BMW, told The Wall Street Journal. Still, consumers may see touchy-feely as too much of a stretch for BMW; “Germans? Joy? Hahahaha,” remarked one commenter on the auto blog Jalopnik.
We just wrote about the irony of multinational big-box retailer Office Depot casting its lot with the little guy in a somewhat shameless bid to tap into populist zeal. By contrast, Miller Life will run regional Super Bowl ads that showcase a more authentic effort to align with the Main Street America ethos.
“This year the brand is giving its Big Game commercial to deserving small businesses from around the country,” reads Miller High Life promotional copy. “The ad … reinforces that Miller High Life isn’t just about brewing a good, honest beer at a tasty price, it’s about helping others live the High Life as well.” Spots will highlight four businesses (Loretta’s Authentic Pralines in New Orleans, etc.).
A teaser ad cleverly positions this Super Bowl advertiser as standing apart from “those big muckety-muck companies [that] prance out those fancy-pants commercials.” The tone is spot-on, as is the approach (positioning the effort as socially responsible). And it’s the perfect time for a brand that has long cultivated a blue-collar image to play on populist sentiment.
Assurances and guarantees were a dominant theme in marketing during this difficult year, helping to assuage consumer anxiety about spending. It kicked off with Hyundai’s widely copied Assurance Program. By late summer, GM was offering a “60-day satisfaction guarantee” (“If you don’t absolutely love your new vehicle, we’ll take it back”). In the online-travel category, Orbitz now offers both a “Price Assurance” program (if another customer books the same flight/hotel for less, Orbitz refunds you the difference) and a Low Price Guarantee (find a lower online fare for the same booking and Orbitz refunds the difference and gives you a $50 coupon). Competitor sites are doing likewise.
Now Gap is experimenting with putting this idea in the mall. Its Sprize program, so far only operating in the Vancouver area, has shoppers register for a Sprize card, which they show whenever they buy a Gap item; if the item’s price drops within 45 days, the difference is credited to the card. That credit is redeemable for up to a year.
This seems like a smart response to what’s become a sticky problem for retailers, which have been forced to slash prices this year, in effect training today’s value-conscious shoppers to wait for sales and offers (coupons, etc.). Since Gap’s refund is in the form of a credit, a good percentage of shoppers will likely spend extra once they’re back in the store or forget to redeem it at all. It will be interesting to see whether Sprize provides enough incentive to get bargain hunters to buy now and hope for discounts later.
For many Americans, this recession has meant putting the brakes on freewheeling consumerism while at the same time learning to enjoy the simpler pleasures that come with more time spent at home among family and friends.
L.L.Bean does a nice job tying these two trends together in a holiday commercial that shows a family frolicking in slow motion in a snowy wonderland. Backed by what sounds like hand bells being quietly struck, the voiceover tells viewers: “Every penny counts. So does every moment. Make the most of both this holiday season with free shipping from L.L.Bean.” (Accompanying copy on YouTube and Facebook also advises shoppers to “Slow down and enjoy the season.”) To further back up the first part of the proclamation, the Maine-based retailer is offering a $10 gift card with a purchase of $25 or more.
“It Has to be Heinz” represents the brand’s biggest umbrella campaign in five years in the U.K. The latest spot shows a range of lighthearted situations that “just have to be” (“Men just have to gather around the barbecue,” “Mum has to call at exactly the wrong time,” etc.), ending with the line “And always, it has to be Heinz.”
Like most supermarket brands, Heinz has been bruised by competition from private labels as consumers trade down and cut costs. In response, the company has hiked its global marketing spend this fiscal year by 15 percent, and CEO William Johnson recently said Heinz will continue to increase its marketing investment through April.
Heinz is coming at this recessionary challenge from a strong position: Its ketchup “consistently appears as the brand that British consumers least want to give up, followed by Heinz Beanz,” according to Marketing columnist Mark Ritson. So while many supermarket brands have been boldly asserting their value in response to the private-label threat (as we’ve noted), Heinz is doing something different: It smartly turns its ubiquity in the British kitchen into its own kind of value and implies that giving up the brand is akin to going against the natural order of things.
New York City’s new “NYC Extreme Local” campaign—designed to get locals spending more at neighborhood businesses during the holiday season—reflects several trends JWT has written about in the past few years.
Co-sponsored by American Express and AT&T, the print, outdoor and online campaign touts “24 days of shopping, dining, deals, events and more” in 15 Manhattan and Brooklyn neighborhoods (the emphasis on neighborhoods presumably explains the “extreme” aspect of local). A microsite also outlines a promotion: Make a total of $300 in purchases at three or more participating businesses with an American Express card and get a $50 card credit.
NYC & Company, which is behind this campaign, is one of several tourism organizations that have responded to the ongoing “staycation” trend by focusing on locals. Such efforts tie in well with the current affinity for all things local, especially at a time when many neighborhood businesses are hanging on by a thread; efforts like the 3/50 Project have sprung up to encourage people to patronize such businesses. (Most participants in the “Extreme Local” effort are independents, but IKEA in Brooklyn and a few other chain stores are also involved.)
One of JWT’s 10 trends for 2010 is Location-Based Everything, which covers the growth of location-based or -aware tools that use data from a user’s mobile phone—an area of huge potential for brands that can help consumers based on their location. We’ll see more brands building up their credentials as guides and advisers. American Express operates a travel-themed site that breaks down deals for cardholders by city. And as noted in a New York Times story on the “Extreme Local” campaign, AT&T wants to promote offerings including its Yellow Pages mobile applications.
AT&T told the NYT that it’s hoping to find similar sponsorship opportunities in other major markets. Watch for more promotions that tie these themes together.
In “Marketing in a Recession,” an audit of existing thinking on the topic that we published last fall, we repeated a well-known story about advertising in tough times: Kellogg’s and Post were close rivals until Post cut its spending during the Depression and Kellogg’s kept going—gaining the edge it still enjoys today.
Kellogg’s has persisted in spending on advertising to keep lower-priced players at bay. “We believe it’s critical, when the economy gets tougher, that people should be seeing the value of our brands constantly,” CMO Mark Baynes told BusinessWeek last year.
Fast-forward to an Oct. 29 Ad Age story: “Kellogg Co. bested industry expectations with third-quarter earnings released this morning, thanks in part to higher ad spending.” Earnings per share grew 5 percent in the quarter, as the company increased its ad spend by as much as 17 percent. Kellogg’s said it’s likely to boost spending by a similarly sizable percentage next quarter.
“Our commitment to investing in advertising continues to be a key to our business model and to achieving our goals,” CFO John Bryant told analysts, according to Ad Age. As we noted a year ago, while spending alone doesn’t guarantee success, a multitude of studies have confirmed the potential upside of spending through bad times and the potential downside of cutting back. And for premium brands, price may not be a barrier when the consumer believes in or feels a connection to the brand.
The New York Times recently ran a story, “In New Campaigns, Spots Take On a Rosier Hue,” observing that new messaging from brands including GE, Bank of America and Levi’s visualizes a bright future for America. “Marketers’ emphasis on American pride and an economic comeback suggests that the air is starting to crackle with optimism,” the paper reported.
But new spots for John Hancock’s “Cursor” campaign—dialogue-free commercials in which people tap out digital messages—acknowledges some disheartening realities that everyday Americans are facing. In one ad, an older man in a café messages a friend: “Remember when we used to say ‘WHEN’ we retire like it was a sure thing?” Responds his mate: “Then it became a lot of ‘WILL WE.’” To get “from WILL WE back to WHEN WE,” the spot touts Hancock’s findtheanswers.com. In another spot, a middle-aged man texts his wife about someone whose parents are selling their house—“realized their money wouldn’t last”—and moving in with the younger couple. “Tell me that won’t b us,” he pleads.
Viewers likely want a bit of both approaches. John Hancock’s message that it understands the retirement-related anxieties of Americans will surely strike a chord; at the same time, consumers want to believe in an “American renewal” (as GE puts it), even if the job market they’re facing offers little immediate hope.
This Christmas won’t be a merry one for retailers, which are faced with frugal consumers still anxious about the economic upheaval of the past year. In the U.S., the National Retail Foundation is forecasting a 1 percent drop in total sales for November and December combined. That’s a decline over last year—which is considered the weakest holiday season on record (that is, since the Commerce Department started tracking retail sales in 1967).
Not surprisingly, the NRF says it expects to see aggressive price promotions, with some prices, notably in electronics, dipping below last year’s. Wal-Mart is setting the tone: Last year it priced 10 popular toys at $10 for the holidays, and this year—after working with toy makers to create new items and institute cuts on existing ones—it’s expanding the offer to more than 100 toys. To achieve the $10 threshold, the retailer cut prices by up to 50 percent. Target countered by saying it will match Wal-Mart’s prices where it sells the same items.
Along with price wars, expect to see retailers “turning back the clock, conjuring images of hearth and home,” as the Associated Press recently reported. Comforting consumers by tapping into nostalgia has been a popular tactic during the recession, as several of our contributors have noted, and it will dominate this holiday season. Where whimsical and splashy characterized marketing in recent years, now it’s all about old-fashioned and traditional. Seen any good examples? Send them our way.
The global fashion retailer Mango has launched a lower-priced collection, Think Up. Some of the line’s 90 items are new, but most just feature new, lower prices; special price tags will distinguish the pieces. There’s also a Think Up blog, which chats about fashion, pop culture and the like.
The tagline, “Special prices for creative living,” adeptly taps into young fashionistas’ recent shift away from mindless spending and toward more creative solutions for looking good.
A few other retailers have followed this strategy—we wrote about one Israeli chain launching a “basic line” in a bid to retain customers without damaging brand perceptions. In Mango’s case, the Spanish retailer is seeking to hold on to newly thrifty customers who are being tempted away by value chains such as H&M and (in Europe) Primark. Watch for other fashion chains to become similarly aggressive in taking on their lower-priced rivals.
Assurances and guarantees were a dominant theme in marketing during this difficult year, helping to assuage consumer anxiety about spending. It kicked off with Hyundai’s widely copied Assurance Program. By late summer, GM was offering a “60-day satisfaction guarantee” (“If you don’t absolutely love your new vehicle, we’ll take it back”). In the online-travel category, Orbitz now offers both a “
New York City’s new “NYC Extreme Local” campaign—designed to get locals spending more at neighborhood businesses during the holiday season—reflects several trends JWT has written about in the past few years.
The global fashion retailer Mango has launched a lower-priced collection, 
