Branding In A Challenging Economy

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Ad Age report finds that aggressive branding during economic downturns creates unique opportunities.


One piece of branding news that caught our attention recently can be found in an extensive piece of research by Advertising Age magazine.  The headline of the research is that overall ad spending fell over 10% in 2009, during one of the most painful recessions in decades.  But a deeper look into the numbers reveals that 26 of the top 100 brands actually increased their advertising spending as the nation’s economy struggled.  The result?  Of those 26 brands that expanded their spending, 70% saw a corresponding increase in sales during 2009.

When a brand’s revenue falls or profits begin to dive, one of the first reactions is often to find ways to reduce expenses.  This strategy makes sense as often a good crackdown on expense lines reveals waste and opportunities to make a company more profitable.  One flaw in many expense-reduction reviews, however, is clearly visible in this Ad Age report.  During tough times, marketing dollars are often seen more as a discretionary line of expenses that makes for a juicy target, rather than a revenue-generating opportunity.  As competitors pull back marketing budgets, a hole opens in the market to gain more market share often with more value, created by more competitive advertising costs.

As this article reveals, more times than not when a brand “leans forward” with its marketing as competitors are moving the other direction, the result can translate into greater brand awareness and increased sales.  As economic conditions cycle back in a recovery, those companies who seized the opportunity to raise awareness of their brand find themselves in a much better position than those who ran for cover.  There are opportunities in every type of economic cycle, but far too often we see companies passing on opportunities to increase brand awareness at the exact time their competitors open the door.

Read the entire Advertising Age report.

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