If we are to believe economic forecasters, expect 2002 to be a tough year. Many of you have already begun taking matters into your own hands by cutting costs here and there.

That’s all fine, good, and probably needed. However, a word to the wise is sufficient: Don’t cut advertising.

Gerry Khermouch produced a thought-provoking commentary on this very subject in the August 6 issue of BusinessWeek. The title of his article reveals his bottom line: “Why Advertising Matters More Than Ever.”

Writes Khermouch:

“Certainly, ad agencies and media sales staffs have been doing their best to remind advertisers that history has a way of repeating itself. They point to the last downturn, in the early 1990s, when private-label products leaped to prominence while packaged-goods marketers slashed their budgets. And while it’s not definitive, some research suggests that the best way to gain share is to sustain your spending during a downturn as your rivals are cutting back. That’s how cereal maker Kellogg leapfrogged C.W. Post during the Depression, and how Pizza Hut and Taco Bell grabbed share from McDonald’s during the early 1990s’ dip.”

Quoted in the article is Kevin Lane Keller, marketing professor at Dartmouth University’s Amos Tuck School of Business. Warned Keller, “People who starve their brands now will be paying for it in the future.”

Notes Khermouch:

“After all, in an era of wide consumer choice among roughly comparable products, marketers have learned to think of their brands not so much as a list of features or a logo or an advertising tag line but as a relationship with the consumer. And just as one’s friendships need to be kept in good repair, customer relationships can be maintained only through consistency. The marketing budget pays for much of that needed face time.”

He adds later:

“Besides, those that cut back risk ceding ground to a few well-funded players eager to grab market share from weaker rivals. That’s why third-ranked IBM, with a $650 million media budget, is ‘absolutely going to stay the course,’ says Maureen McGuire, vice-president for integrated marketing communications. ‘Successful companies try to use the downturn to solidify their position and take some share. We see it as an opportunity.’” Concludes Khermouch:

“That kind of long-term thinking may well be one reason why IBM lost only 1% of brand value last year, compared with bigger declines at some other high-tech companies. Will IBM and similar opportunists show the grit to maintain these commitments? As Dartmouth’s Keller points out, marketers tamper with their core commitment to their brands at the gravest risk. Those who don’t burnish their brands in the downturn may find their good names are worth a whole lot less when the tough times end.”

Get the picture?


In her presentation at the recent Sheet Metal and Air Conditioning Contractors’ National Association (SMACNA) convention, industry consultant Ruth King pointed out that advertising does not have to be a money-depleting adventure. We can all agree that e-mailing marketing messages to customers and potential customers is not going to break the bank.

E-mail “is a non-intrusive way to send a marketing message,” she said, noting that “websites are absolutely critical at this time. Put your latest projects there. Put pictures on there. People like to see what you’ve done.”

King, like many others, is also a firm believer in the power of advertising through direct mail. Because of the current anthrax scare, she advises using only postcards for direct marketing because of the current fear of opening envelopes.

“This means sending pieces on a regular basis,” she said, calling it “drip marketing.” “Just make sure that you contact your customers and potential customers at least once per quarter.”

Don’t be surprised if the first direct mail piece gets thrown out. Just know, says King, that “the second they might remember; and they might remember to call you after the third one.”

“Unlike television or radio, you know exactly who you are sending your message to,” she noted in one of her recent “Contractor Cents” e-mailings. “There is no wasted money on people in geographic areas you don’t cover or people who can’t use your services.

“But, you say, most of it gets thrown out. That’s true. However, not for reasons you might think. Many times it is poorly conceived direct mail pieces that don’t grab the reader’s attention, or you have the wrong mailing list.”

King suggests the book Direct Mail Copy That Sells by Hershel Gordon Lewis as a good reference.

Just keep in front of their face. Such is the way of the world today. If you are not known, you don’t get the business.

Skaer is editor-in-chief. He can be reached at 248-244-6446, 248-362-0317 (fax); markskaer@achrnews.com (e-mail).

Publication date: 12/10/2001