Spooner on…how brands can survive cost of living crisis

spooner newSecure as he is, luxuriating in his Western fastnesses among the water meads and vineyards and lily-ponds, sheltered by the languid curves of the downs that beetle above his magnificent, many turreted, machicolated Sussex mansion – and site of special horticultural interest – safeguarded by centuries and phalanxes of devoted, if not besotted, staff, retinue, entourage and retainers, Lord McKelvey still, surely, as evidenced by the following words, deeply and genuinely commiserates the suffering of the little men and women of this world.

Why else would he have ordered me – surrounded as he was by his pack of rigorously trained Cairns Terriers, striking his riding crop against the mirror-sheen of his faultless, handmade top-boots – to write this particular column?

“Spooner, you worthless cur!”, he barked, in his honeyed, film-star tones, “I require a thousand of your very best words on ‘Marketing In The Cost-Of-Living Crisis’ by sunrise, or I shall set my brave and rowdy terriers upon you again.

“Jump to it!”

Naturally, in as much as this sagging bag of crumbling bones is capable of ‘jumping’, reader, I jumped. I can only hope that I do not, as so often, incur his wrath simply by doing his bidding.

According to a publication, only half as essential as Lord McKelvey’s own prestigious Decision Marketing, the soi-disant Marketing Weekmore than a third (38%) of shoppers say they have already started to swap their tried and trusted brands for supermarket value ranges or cheaper alternatives. Some 24% have cancelled subscription services such as Netflix; 33% have cut back on large expenses like holidays abroad; and 33% have cut their spend on non-essentials like eating out. 35% are already driving less. 23% have cancelled donations to charity and 53% are considering delaying life events (weddings and parties I suppose).

This is hardly surprising when 91% say they are ‘concerned’ about the rising cost of living – with 58% ‘very worried’ about prices getting out of control.

‘So, what can a humble marketing person do in response to this?’ I hear you cry.

Well, the short answer is ‘Not a lot’.

But, as someone whose career has somehow continued through at least four disastrous economic downturns, I do have some thoughts.

Be honest
Now I realise that this is a bloodcurdling concept for many of you, but bear with me. If you tell your customers that you are raising your prices because of dramatically increased overheads – fuel costs, logistics costs, energy costs and so forth – they may not be happy but they may well bear with you.

If you describe increased costs as OUR BEST PRICES and they can remember what they paid before, you will seriously piss them off. I’m looking at you Mr Sainsbury.

Likewise, if you are a financial services provider, telling the people who pay to use your services that you are charging them more ‘due to circumstances beyond our control’ is not helpful at all. Yet, if you explain why you are increasing your charges – and not just in a blunt FCA-compliant way – you may find that you retain what little trust they may still have in you.

Remember, the great British public is already angry with you, simply because of what you do – and after what feels like thousands of years of Tory government, they are super-sensitive to hypocrisy, selfishness and deceit – so you could give honesty a go.

What have you got to lose?

And if you are working in the world of fund-raising, well, honesty is very often the best currency in the good times – but it’s even more important when disposable income has shrunk so dramatically. Donors recognise that times are tough for you too – and if you can demonstrate, truthfully, how you are responding to rising costs, you may even build greater loyalty.

I understand that I may actually sound clinically insane in recommending honesty to you, but as I often say to my ghastly children, “Trust me, I work in advertising”.

Talk to them
Those of you who have read all forty-five of my columns in this august publication will know that I often remark upon how difficult companies make it for their most important asset, their customer base, to engage with them.
I may even have suggested that the hallmark of late-stage global capitalism is to make customers pay through the nose for the privilege of doing all of their own admin.

Some of your wealthier customers may glide though the cost-of -living crisis serenely unruffled. Most won’t. If you can find any way at all of making things easier for the majority, they will thank you for it. I don’t mean taking a hit on profit to keep prices low, I am not yet quite that mad. I mean helping them to spread costs, incentivising payment by Direct Debit, moving to a subscription model, discounting bundled packages and the like.

But by far the most important thing for you to do is to continue to communicate with your customers. Use social media, use SMS, use broadcast media, even use the press – to explain what you are doing and why.

And don’t promise better times – ask them what they want and, if you can afford to do some of the things that they suggest, tell them you are doing it, tell them you’ve told them – and then tell them again.

Don’t stop doing stuff
Very often an organisation will look at its marketing budget with a resentful eye when times are tight. The temptation is to put activity on hold and ‘ride out’ the hard times.

This is simply idiocy.

During any kind of economic crisis media prices can be very attractive indeed. What’s more, your media pound will buy you more than at other times (many of your competitors will take the kind of cautious approach that tempts you yourself).

But remember, share of voice increases when there are fewer voices.

Your suppliers will often be happy to discount services to ensure a continuing relationship and if you are honest and continue to communicate with your key audiences you may well reap the benefits – as this quite good article in the Harvard Business Review sets out in that strange, dry, half-academic, half-folksy way that it has.

Don’t panic
Many of the ‘greener’ energy companies operated using a business model that was only sustainable in the good times. The minute price pressure was applied they went out of business.

Is your business model sustainable? If it is, don’t panic. Keep doing what you do.

Be an established, luxury brand.

Of course, the best way of marketing your way through a cost-of-living crisis is to be an established, luxury brand. If your target audience is the plutocracy, you are laughing – as they know nothing of such things. Haute couture, jewels, fancy cars, multi-million dollar properties, yachts, Lear Jets, you know the kind of thing – they all hold up quite robustly when, as my daughter puts it, “we are all fighting over the last Nando’s bone in a ditch”.

But (though Lord McKelvey may be able to correct me here) I doubt that the CMOs of Maserati, Van Cleef & Arpels or Chanel are regular readers of my column in the UK’s premiere magazine for the world of highly-targeted marketing and advertising (or whatever we are calling it this week).

And remember, the current nonsense is partly the result of circumstances beyond your control. None of us had plague or a potential world war in our marketing plans for 2019, after all.

So, if your client, donor, or customer is currently feeling the pinch, do as I do: be honest, don’t stop talking to them, keep doing stuff and above all – don’t panic.

After all, we will soon be frisking and frolicking in the sunny uplands of post Brexit-Britain – enjoying a vast wealth of Brexit benefits – using our recovered Euro-millions to rejuvenate the NHS, fixing education and social care, soothing social unrest, catching clean, timely trains, conforming with climate-crisis protocols – and, above all, thanking our lucky stars that we have an honest, straightforward, upright, consistent, trustworthy leader like that De-Pfeffel Johnson man – and his team of caring individuals who selflessly seek betterment for people at every level of society.

Right, I’m off to read the Sue Gray report.

Have a fabulous Platinum Jubilee Weekend one and all!

Jonathan Spooner is consulting creative director at Spoon Creative

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