Should I cut my CPG advertising and marketing budget?
This question is being asked by packaged goods marketers everywhere right now as the COVID-19 pandemic overturns daily life (not to mention supply chain and forecasts) around the world.
Sure, pulling back ad budgets will potentially help the bottom line. But what’s at risk? A new study by Kantar just revealed that “going dark to save costs” can have drastic, long-term impacts on brands. In fact, “a six-month absence from TV will result in a 39 percent reduction in total brand communication awareness, ‘potentially delaying recovery in post-pandemic world.’”
People have relationships with brands, and brands need to maintain those relationships in both good times and tough times. This continuity is important. Steady communication will help your brand recover faster. Data tracking from the 2008 financial crisis shows that brand strength is a leading indicator of how fast a brand will recover, with the strongest brands recovering up to 300% more than others.
Evidence is actually pointing to the fact that media consumption will skyrocket as consumers spend more time at home. A study from Nielsen shows we might see as much as a 60% increase in the amount of content viewed as consumers look to stay informed, fill their time and keep in touch with others.
But this doesn’t mean business as usual. Messaging and objectives need to be adjusted. First and foremost, look to provide value and not exploit the situation of a captive audience. Here are a few tips as you navigate adjusting your approach:
- Acknowledge the current environment and what consumers are going through.
- Let consumers know what your brand is doing to combat the situation.
- Be genuine, current and transparent—and be prepared to adjust in real time as things are changing daily.
- Focus on the consumer and the value your brand can bring during this time. Brand advertising is very relevant as opposed to direct response sales messages.
- Don’t worry about expensive production value. Understated or motion pieces can go a long way in the current climate. And speed to market is key.
It is important for brands to be strategic in how they advertise and what message they convey right now. But, at the same time, they must continue to look toward the future. We know that marketing is not an optional expense. It’s a good and necessary one. It brings in revenue. It drives brands into the future. Don’t let the current COVID-19 climate distract your view of the future. If your brand is looking for ways to reach your target market during this time of uncertainty, we’re here to help.
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