Back to results THE FRONT PAGE : Let the good times roll By Julie Rutledge Post recession, when are those delicate green shoots going to sprout into a full blown economic recovery? And who will fare best when the good times roll around again? In the words of ANZA ceo Jeremy Irwin: “Optimism has largely replaced pessimism but with a cautious approach to advertising investment. It will be good to see some positive reinforcement and market upswing as the year progresses.” Reports of rising business and consumer confidence throughout 2009 may have buoyed the spirits a little, but is our joy premature? Are we really on the verge of a recovery? Surely it is only natural to grasp at the positives and desire better times? Summertime and the holiday season, coupled with Christmas, a time for giving and eating (and consequently buying) has given us all brighter spirits. Consumers and retailers enjoyed the lead up to Christmas, with spending up 6.2% on 2008. Many retailers saw Christmas as an opportunity to counter what had been a very tough year. Marketing tactics were focused on sales, with consumers being lured with ‘never before’ deals on everything from whiteware to clothing, toys to technology and discounts as high as 75% in some instances. The Boxing Day sales have closed. What strategies will take retailers into 2010 and beyond? CAANZ ceo Rick Osborne: “Whilst an element of economic volatility stills remains, 2010 is shaping up as a year that will likely reward those forward-thinking businesses who maintained communication with their existing and potential customers during the dark times of 2009.” Regardless of whether we are on the rebound or just in the midst of a bounce, all the research tells us that those who continue to market themselves, retaining a high profile throughout a recession, can maintain sales and profits. “Businesses mustn’t overlook the importance of ensuring that there is an effective marketing budget in place – even if you don’t plan to spend it all – if brands are to respond to the anticipated 2010 recovery,” Osborne says. (See the NAB’s September 2008 Advertising in a Tough Economy report at www.nabs.co.nz.) “It’s an old adage but cutting marketing budgets is only profitable in the short term, and ultimately the brand – over the medium to long term – emerges much weaker. That’s why it’s important to increase marketing spend in the early stages of an economic recovery.” Markets, consumer attitudes and behaviours do change in recessionary times, and businesses need to be aware that strategies that produced sales in the past may no longer work post recession. A recent McKinsey Research study suggests consumers are learning to live without expensive products and say they may not return to pre-recession premium brands as they are “not worth the money”. Consumer buying behaviour and concerns over quality and price have changed over the past 10 years. In the NAB’s 2009 Retail Report, The Kiwi Consumer, we explore some of those changes, including ... • A tendency to research purchases more thoroughly prior to in-store purchasing. • Looking for quality but less likely to believe higher prices mean better quality • 60% of respondents in the Q3 08-Q2 09 Nielsen Readership Survey say they shop a lot for specials and bargains. (Look at the new figures to Q3 09 – it will be interesting to see how that statistic has changed in the past six months.) • Consumer attitudes have changed. They are looking for increased value, better service and they will take time to research where best to find what they require. • If you are selling something, best be in the market now espousing how you can offer better value and service, so you are already in the mix when the good times do roll around again. Jeremy Irwin predicts marketers will be cautious but will need to be visible: “Cost effective new and traditional media opportunities will be evaluated very closely before ad placements are made, and post placement. “The winners in the marketplace will continue to be those who heeded the research provided to advertisers in 2008 that demonstrated ongoing advertising investment in recessionary conditions will enhance the short and long-term strength of their brands.” Julie Rutledge is the Newspaper Advertising Bureau’s Market Information Manager. © Copyright AdMedia magazine February 2010 All material appearing is copyright and cannot be reproduced without prior permission of the publisher. Please contact the copyright officer: Ph 0-9-845 5114, Email copyright@mediaweb.co.nz.	Username Password Keep me logged in on this computer Forgotten your password? Enter your email address and we will email your password to you:

THE FRONT PAGE : Let the good times roll

By Julie Rutledge

Post recession, when are those delicate green shoots going to sprout into a full blown economic recovery? And who will fare best when the good times roll around again?
In the words of ANZA ceo Jeremy Irwin: “Optimism has largely replaced pessimism but with a cautious approach to advertising investment. It will be good to see some positive reinforcement and market upswing as the year progresses.”
Reports of rising business and consumer confidence throughout 2009 may have buoyed the spirits a little, but is our joy premature? Are we really on the verge of a recovery? Surely it is only natural to grasp at the positives and desire better times?
Summertime and the holiday season, coupled with Christmas, a time for giving and eating (and consequently buying) has given us all brighter spirits. Consumers and retailers enjoyed the lead up to Christmas, with spending up 6.2% on 2008.
Many retailers saw Christmas as an opportunity to counter what had been a very tough year. Marketing tactics were focused on sales, with consumers being lured with ‘never before’ deals on everything from whiteware to clothing, toys to technology and discounts as high as 75% in some instances.
The Boxing Day sales have closed. What strategies will take retailers into 2010 and beyond? CAANZ ceo Rick Osborne: “Whilst an element of economic volatility stills remains, 2010 is shaping up as a year that will likely reward those forward-thinking businesses who maintained communication with their existing and potential customers during the dark times of 2009.”
Regardless of whether we are on the rebound or just in the midst of a bounce, all the research tells us that those who continue to market themselves, retaining a high profile throughout a recession, can maintain sales and profits.
“Businesses mustn’t overlook the importance of ensuring that there is an effective marketing budget in place – even if you don’t plan to spend it all – if brands are to respond to the anticipated 2010 recovery,” Osborne says. (See the NAB’s September 2008 Advertising in a Tough Economy report at www.nabs.co.nz.)
“It’s an old adage but cutting marketing budgets is only profitable in the short term, and ultimately the brand – over the medium to long term – emerges much weaker. That’s why it’s important to increase marketing spend in the early stages of an economic recovery.”
Markets, consumer attitudes and behaviours do change in recessionary times, and businesses need to be aware that strategies that produced sales in the past may no longer work post recession.
A recent McKinsey Research study suggests consumers are learning to live without expensive products and say they may not return to pre-recession premium brands as they are “not worth the money”.
Consumer buying behaviour and concerns over quality and price have changed over the past 10 years. In the NAB’s 2009 Retail Report, The Kiwi Consumer, we explore some of those changes, including ...
• A tendency to research purchases more thoroughly prior to in-store purchasing.
• Looking for quality but less likely to believe higher prices mean better quality
• 60% of respondents in the Q3 08-Q2 09 Nielsen Readership Survey say they shop a lot for specials and bargains. (Look at the new figures to Q3 09 – it will be interesting to see how that statistic has changed in the past six months.)
• Consumer attitudes have changed. They are looking for increased value, better service and they will take time to research where best to find what they require.
• If you are selling something, best be in the market now espousing how you can offer better value and service, so you are already in the mix when the good times do roll around again.
Jeremy Irwin predicts marketers will be cautious but will need to be visible: “Cost effective new and traditional media opportunities will be evaluated very closely before ad placements are made, and post placement.
“The winners in the marketplace will continue to be those who heeded the research provided to advertisers in 2008 that demonstrated ongoing advertising investment in recessionary conditions will enhance the short and long-term strength of their brands.”

Julie Rutledge is the Newspaper Advertising Bureau’s Market Information Manager.

© Copyright AdMedia magazine February 2010

All material appearing is copyright and cannot be reproduced without prior permission of the publisher.

Please contact the copyright officer: Ph 0-9-845 5114, Email copyright@mediaweb.co.nz.

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THE FRONT PAGE : Let the good times roll