by Phil Huzzard | Dec 19, 2022 | Thinking
A softer economy is predicted in the New Year. Here’s how you can win.
When, during the pandemic, the Governor of the RBA predicted record low interest rates for years to come, people listened. Many are now overcommitted borrowers and blame the RBA for their situation.
In an about-face, the RBA is now increasing the cash rate beyond where many experts agree is optimal to balance the nation’s economic health with inflationary pressures.
Meanwhile, there is already data that suggests the economy is slowing. One example can be found in the cost of freight. A 40’ container from Shanghai 6 months ago would have set you back $13,000. The current price is $700.
Federal and State government infrastructure spending is keeping the economy from a hard landing, but we’ll probably see a more pronounced slow-down post-Christmas. It’s something we all need to plan for.
The great news is that many of your competitors will be planning to cut their marketing budgets next year. What they do spend will probably be focussed on performance media. That means the opportunity to build brand presence and preference will become cheaper and less competitive.
History as a teacher
Why zig when everyone else zags?
Consider the case of Proctor and Gamble during the Great Depression. When the rest of the soap market went into full retreat, P&G experimented with taking up a sponsorship of a syndicated radio serial, Oxydol’s Own Ma Perkins. This small, tentative toe in the water was so successful that P&G went on to sponsor 29 such serials (this being, of course, where the term ‘soap opera’ was born).
P&G then rode the recovery to become the global giant it remains to this day.
Keep calm and carry on
Marketing budgets are often the first things under the microscope when times get tight. But within each category, at least one player will buck the trend. Be that player.
By maintaining your marketing spend – maybe not at last year’s levels, but certainly at a level that helps you seize a share-of-voice advantage over retreating competitors – you’ll see a significant uplift in the weight of your brand in market.
Also, by offering solutions that are relevant to the present conditions or helpful to stressed buyers, or by offering a positive voice amid the economic gloom and doom, you’ll not only increase your presence, but be seen as a brand people want to associate with.
Your increase in market share and presence will deliver big dividends as the recovery floats your (now bigger) boat.
We’d welcome the opportunity to help you calibrate where you are now in relation to your customers and competitors and discuss cost-effective options to gain an advantage during the coming dip.
Call Phil Huzzard on 0418 344 763 or email firstname.lastname@example.org.