The ads which really do the numbers in hard times aren't the ones you'd expect. Chris Baker highlights examples in the IPA's Advertising Works volume to be released next week
Can advertising hope to be cost effective in a recession?
On the evidence of the 1992 IPA Advertising Effectiveness Awards, which Marketing sponsored, the answer to this question must be a resounding 'yes'. The 31 entries shortlisted represent excellence, both in terms of advertising effectiveness and its evaluation.
Despite this evidence -- that for many companies advertising still works in a period of recession -- ad expenditure in the past three years is well down on the levels which prevailed during the second half of the 80s. It has been estimated that the recession has been four times worse in advertising than in the overall economy.
Among the first to go under pressure
The fact remains that advertising is something that most companies do more of when overall corporate profits are increasing, but is among the first things to go when profits are under pressure.
Difficult times make it harder for the agency to argue for the value of advertising to its clients. The Mandy Rice-Davies response -- "They would say that, wouldn't they?" -- is inevitable, closely followed by the injunction to "prove it".
The case histories in Advertising Works 7 are of great value in this respect. They provide a detailed and transparent analysis of the specific ways in which specific advertisers have benefited from advertising in a period of recession, including full supporting data. In addition, they provide insights about what it takes to succeed with advertising. Two main ingredients emerge over and above basic strategic competence: confidence and creativity. Neither are strangers when it comes to effective advertising in any economic climate, but when the going gets tough, both become doubly important.
In many ways, this year's Award winners are a roll of honour of confident companies. They include established goods and services with the confidence to build their consumer franchise and actively go after business when market trends and general economic factors were against them. The dairy industry's Milkman campaign, Kellogg's All-Bran, The Economist and Whipsnade are all examples of this. There are advertisers with the confidence to launch new brands with creativity and panache -- Haagen-Dazs, Gini, the Renault Clio, K Shoes and Cussons Limelite -- or to develop an underdeveloped consumer franchise, such as Scottish Amicable and Direct Line. Others demonstrate how long-term commitment to building confidence in their brands has allowed them to prosper even in the face of competitive pressures and sometimes difficult market conditions. …