Don't make too much hay while the recession rages ~ Brand Mix

Friday, March 13, 2009

Don't make too much hay while the recession rages

Photo: The_WB (Flickr)

Not everyone is having a lousy year. McDonalds is doing well. So is Wal-Mart.

Abu Mallick posting on the JWT Anxiety Index blog asks an interesting question: "If bad times equal good times, what happens when the good times return?" How will those companies like McDonalds that are doing well now fare when things get better?

Maybe this recession will change lifestyle habits permanently: "thus fostering a permanent love for affordable brands among mainstream consumers" or perhaps the current love of affordable things is just a: "short-term coping strategy." Brands that are doing well because of the recession have to be careful not to become too closely associated with it. Otherwise, when the good times eventually roll, they'll be abandoned.

"Thank God we don't have to go there anymore," is the consumer thought they need to avoid.


Jeffry Pilcher said...

Are they successful because they are value brands? Or are they doing something with their marketing to make sure they stay on top? The first theory sounds passive, like the marketer is just lucky. The second theory wonders to what degree they're being proactive.

P&G is another company faring well, and they expressly and deliberately chose to not drop prices in response to the recession.

Ian Fitzpatrick said...

Interesting. I would posit that a brand like Wal-Mart has done a great job of positioning themselves to extend the success beyond the recession by amping up their 'live better' messaging, and then fulfilling upon that in-store by carrying a broader range of products.

Conversely, those who make price the sole point of differentiation are in for a tough recovery, indeed.

Martin Bishop said...

Jeffry, Ian: Agree with both your comments. I think the brands doing well right now are benefiting from being in the right place at the right time. But that some (e.g. Walmart and P&G) are doing more than what's strictly necessary so that they can continue being successful after the recession ends.

Charles Sipe said...

I think that some brands are being too proactive in responding to the recession. Take the McDonalization of Starbucks for instance with their value meals and instant coffee. However they can't successful as a value brand because they are charging $4 for a cup of coffee.

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