Challenger brands need different rules for growth during a recession
Opinion: Strategy Leaders
We know brands should continue to invest in a downturn. But what if your brand doesn’t have the resources to compete in a share of voice battle over the long-term?
The cost-of-living crisis, the economic downturn, the great big clusterfuck, call it what you will, but the recession is here and looks set to stay for two years according to latest forecasts. We’ve dusted off the ‘advertising in a recession’ playbooks and we’re finding time in our clients’ busy schedules to attempt to convince them to continue to invest in media through the bad times.
We all know the script: those brands that keep the advertising lights on and maintain share of voice will be rewarded with greater market share returns when the tide turns. The mountain of evidence in support of this strategy is solid and undisputed.
But what if, quite simply, your brand doesn’t have the resources to compete in a share of voice battle over the long-term? When investing now for anticipated future brand growth feels like an almighty gamble which only businesses with immediate healthy margins will have the stomach for?
This is the rub for many scaling challenger brands who are now forecasting into their budget a massive row-back of capital investment funding, shrinking consumer demand compounded with inflationary supply-chain and media costs. So blindly asking clients for more budget because it’s worked in the past, is simply off the table.
In fact, we need an alternative set of rules and media behaviours for challenger brands. We need to challenge ourselves to think more creatively about how challenger brands can out-smart rather than outspend the competition. We must fully understand the position of the business bottom up and build an irrefutable business case of what to invest and where, attacking unoccupied spaces, exploring new entry points and getting more tactical with our data.
Attack unoccupied spaces
We’re exposed to over 5,000 ads per day, and 84% of those are unrecognised. But it’s no wonder when media investment is concentrated in the same, predictable channels and category contexts. Whether it’s fintech start-ups plastered all over the London Underground or the 716 gambling messages you’ll see in a single Premier League broadcast, it’s hard to break free from your competitors in a sea of sameness.
Instead, look for the clear spaces in media where your share of voice will be disproportionately higher, where your growth audiences can be reached away from the noise of the competition.
Find new brand entry points
Many brands will soon find themselves attempting to grow share in a contracting category. The path to growth therefore is precariously narrow, but it doesn’t have to be. By finding new and varied category entry points to attach to, challenger brands can forge new routes to market and become more resilient to future shocks.
Saatchi & Saatchi’s chief strategy officer Richard Huntington recently referred to this idea — dubbed ‘Share of Life Thinking’ by Vertic founders Stan Rapp and Sebastian Jespersen — of opening up the role of the brand in people’s lives into new and adjacent spaces. A clearly defined brand purpose will make this task cleaner. Lego is in the business of learning through play which unlocks multiple avenues into the brand. The other dimension to add to the what, is when — finding or creating the moments you want to be thought of which your competitors are neglecting.
The growth of ‘naturally fast food’ restaurant Leon is an example that speaks to both the what and the when, extending their purpose beyond lunchtime into in-home grocery, cookbooks, homeware and a healthy School Food Plan in ways McDonalds can’t.
Test, learn, and scale
There are many reasons this recession won’t resemble the 2008 crash, the media landscape being a pertinent one. We’ve never had such a rich opportunity to conduct experiments in channels with more rapid data feedback loops. To be clear, this isn’t an excuse to shift budget further down the funnel. But it does allow clients with shallower pockets to de-risk investments on a smaller scale, understand and model impact, adapt and scale future investment.
Getting this right means measuring the right things as much as measuring things right, but maybe this time brands will develop their own sharp set of parameters for growth, rather than relying on blunt rules of best practice that do not serve them.
Whilst the evidence suggests brands must go forth and spend to prosper during a recession, these rule books were simply not written for challenger brands. We need to be agile and brave, tear up the rule book, and find new formulas. That forces us to think creatively, and to use new tactics to outsmart the competition.
As the late, great Ayrton Senna once said: “You cannot overtake 15 cars in sunny weather, but you can when it’s raining.”
Chetan Murthy is chief strategy officer at independent UK media agency Bountiful Cow
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