Recession, what recession?

Tuesday, 11th March 2008. Posted by phil in Brand | Permalink | No Comments »

With the US economy in a definite slowdown, and mummurings that the UK will follow suit, what will your strategy be? From experience I recall the normal defensive position is to tighten belts, cut budgets (particularly the marketing budget) and hold on! However, this is a short-sighted view, and one that many top directors refute. A recent Mori poll found that MD's of the top FTSE 100 recognised that a strong brand was their most effective defence against recession. That's because a strong brand engenders trust, and protects you against the worst ravages of recession. Many B2B organisations already feel trapped in a price war with competitors, and whilst pricing is a key element of product development and positioning, many organisations find that it becomes the only way they can compete in an aggressive or recessionary market place. But behind a strong brand there is always a long-term brand strategy that over-rides downturns.

Gaining customers, particularly through an aggressive pricing strategy, is one thing; keeping them is another – and we all know it’s easier and cheaper to keep the customers you have, than find new ones to replace them! Branding is much more than just a good corporate identity or a decent CRM system. A strong brand assists both in staff and customer retention, moves you away from 'just the price' and into the area of trust, reputation and service levels that outweigh 'just the price' – even in tight times. But this needs to be carefully and consistently built through effective brand strategy consulting. This is where a holistic 'all-encompassing' brand strategy can bring real profitability.

Even though the US looks less likely to hit an across-the-board recession, there are going to be areas of recession that will affect UK markets. Just in case you begin to feel the pinch rather more than you would wish, my advice is to look at understanding how strong your brand is currently, how to begin to improve it, and thus underpin your strategy to ensure the ROI on the marketing budget actually works to keep your market share up, and your brand visible.

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