Posts by Deanna Zammit - New York

BP will pay

In his speech last night, President Obama made it plain that BP is responsible for “the worst environmental disaster America has ever seen … one we will be fighting for months and even years.” The words came a week after Obama called on BP to suspend ad spending and dividend payments until the company has fully paid for the cleanup. While the oil giant has agreed to set aside $20 billion for cleanup and claims, the company’s PR team might consider Obama’s advertising suggestion as advice well taken. The catastrophe has laid waste to BP’s carefully constructed “green” image; now its communication efforts are only throwing salt on the wound.

A 60-second spot shows CEO Tony Hayward announcing that BP has taken responsibility for the cleanup, along with pictures of crews mustering on beaches, lowering booms and bathing birds. And while the commercial avoids images of the actual slick, it has inevitably generated angry response videos. BP’s YouTube post of the spot has generated an overwhelming 12,000 or so “dislikes” vs. about 1,100 “likes” (the company disabled YouTube’s comments function). The message is too little too late, and BP’s website covering its cleanup efforts feels far less like a genuine attempt at transparency than a calculated PR move. After all, this is the company that bought the search term “oil spill” from Google in an attempt to get control of its image.

Other oil companies will have to be careful not to be pulled into BP’s quagmire. Perhaps Hippocrates is a good place to start: First, do no harm.

Singer Wainwright sees some brands as synonymous with the ‘New Depression’

loudon-wIn the good ole’ days—about three years ago—it seemed brands racked up only laudatory shout-outs in music lyrics. You remember, back when we were all riding in Escalades, passing the Courvoisier, shaking it like a Polaroid picture. (In 2008 Wired looked at how some brands actually courted musicians.) Now, folk musician Loudon Wainwright III is singling out a handful of brand names for some not so flattering attention. His latest album, Ten Songs for the New Depression, is a compendium about the new hard times, channeling the spirit of the Great Depression with ukulele strains and cutting lyrics.

One that captures consumer helplessness: “Times is tough/Times is hard/take a pair of scissors to your credit card/Circuit City just said, ‘So long!’/All I can do is sing this song.” Wainwright takes aside GMC and Volvo for a slap in the riff “Cash for Clunkers,” while “The Krugman Blues” is a paean to The New York Times columnist, if not the sour commentary he’s been doling out. How can brands escape this downturn without becoming synonymous with the “New Depression”? Survival, for starters. But beyond that, Wainwright’s self-pity suggests consumers need a comforting tone. A good banjo tune helps too.

Photo Credit: http://www.lw3.com/songs.php

iSold.com positions itself as alternative to real estate agents

isoldHome improvement retailers have been hawking DIY as an empowerment tool for some time, but the downturn has seen some other brands looking to the same strategy. Consider iSold.com. The U.K. real estate service, backed by supermarket chain Tesco, is offering a package that includes home valuation, online and print advertising, and agent-led open houses for £999 and up. The service aims to straddle the line between pure online selling—via eBay, for example—and agent-lead sales. Considering that U.K. real estate agents earn 1.5 to 2 percent on each home sale, according to the iSold site, the package could save sellers thousands of pounds. Home owners are responsible for negotiating selling prices and meeting with prospective buyers, but that could be a good thing for iSold. Owners made to feel helpless by the recession might like a turn in the driver’s seat.

Photo Credit: http://www.isold.com/

Unironically, Office Depot jumps on populist bandwagon

The downturn brought a wave of populist fury, stirred up by the good guys/bad guys notion of Wall Street vs. Main Street. But while that fury is now set at simmer, big business remains woefully unpopular—and so in a new commercial, Office Depot harnesses some populist zeal for itself and casts its lot with the little guy.

But Office Depot is a Wall Street-traded big box chain, right? Not so fast. A recent TV spot features Dan, a small-town barber, whose shop is threatened when a large chain moves in across the street offering $6 cuts. So Dan heads to Office Depot for a banner that reads “We fix $6 haircuts.” The banner really sticks it to “Nitro Cutz,” which papers its windows five months later, a satisfying reversal of fortune for Dan.

By casting itself as a Main Street ally, Office Depot slyly gets viewers to forget that it’s a large multinational chain whose low, low prices have put independent stores out of business. Now that’s a reversal.

Knob Creek puts silver lining on stormy cloud

knob-creek-advertisementFolks calming their recession-wracked nerves with a smooth shot of bourbon might find their bottle’s run dry, at least if they drink Knob Creek. Last month, the bourbon maker ran ads in American weekend papers, apologizing for running out of stock until November. Ad copy that read “Thanks for nothing” was paired with a near empty bottle. The line was a delightful twist on the morbid feeling shared by homeowners, stockholders and small-business owners alike these days.

If the tongue-in-cheek thank you note sounds like cold comfort to thirsty customers, think again. Knob Creek has managed to do what most other brands haven’t—pin a silver lining on a stormy cloud. Sure, the bourbon’s stores have run out, but at least someone’s doing well. According to a report in The Guardian, the company is growing by double-digit percentages, and the American consumer is to thank.

Thank you, Knob Creek, for putting the consumer back in the driver’s seat and reminding us that it’s always driest before the dawn. Perhaps by the time Knob Creek’s Christmas batch hits shelves, we’ll be toasting our recovery instead of drowning our fiscal woes.

The Small Movement is here

thumbnails_smallmoveFor a long time, bigger was better. Now, we’re backing off of big. Drivers around the world are embracing small-class cars, developers are downsizing their blueprints, and big businesses are revising their game plans. We’re calling it The Small Movement.

Why is small having its big moment? A global recession that’s forcing us to live with less makes frugal seem fashionable. An environmental crisis makes smaller houses, cars and carbon footprints look more responsible. Booming population growth has turned smaller, more streamlined products into space savers—a key quality in a crowded world.

Small Movement success stories plug into one or all of these themes. Concentrated laundry detergents allow for smaller containers, taking up less space in cluttered home and giving consumers the sense that they’re helping to save the world. Smart cars are eye-catching, gas-friendly and easy to park in crowded cities. Stand-alone kiosks are now big business with big retailers, allowing them entry into new venues—like Blockbuster kiosks in malls and pharmacies.

These are tricky waters for businesses that have relied on selling bigger, shinier doodads for decades. But this new culture of restraint is far from bad news for brands. The Small Movement isn’t necessarily about living with less; it’s about getting the most out of life—your home, your budget, your electronics—without contributing to the world’s ills. Smart marketers will show consumers how to do just that.

Our latest trend report explores these themes and more—download it here.

The recession and its impact on luxury

thumbnails_luxuryPre-recession, luxury was big, bold and blingy. Now, the sector is shrinking—worldwide, the luxury sector saw a 20 percent year-over-year decline in sales revenue during the second quarter, shrinking from $220 billion in 2008 to $198 billion, according to Bain & Company. Bain estimates an overall net decline of 10 percent for 2009.

This is occurring not only because consumers can’t afford the luxe life but because attitudes toward conspicuous consumption have shifted dramatically, especially in developed markets where consumers are experimenting with “brown bag” luxury. Corporate misdeeds have cast the new rich as the new villains, and their luxury lifestyles are no longer an aspirational fantasy.

Luxury manufacturers are rethinking their strategies, shifting away from fast fashion and masstige. They’re returning to their roots—producing the ultimate that money can buy—and they’re responding to new definitions of what luxury is, emphasizing green credentials or playing up health and wellness benefits.

While the appetite for luxury goods is waning in the developed world, however, emerging markets are just getting started. In fast-growing countries like China, India and Brazil, the new meritocracy want to show off their success, and they’re doing so by embracing Western luxury brands.

Our latest trend report explores these themes and more—you can download the report from our Trends and Research page.