It is said that for every arrow of Ram's that got rid of one of Ravan's ten heads, another one popped up.

Interesting
This went on and on in a nightmarish loop till Agastaya Muni pointed out an extremely simple, almost naïve, solution. "Strike at the heart' he said, that's the only way to conquer your opponent.
Ram listened, and, won. Of course he needed the Brahma Missile to do the job, (the instructions for which clearly read "to be used only when all else failed') but then that's another story for another day)
The interpretation explains that this momentous battle between two equally strong opponents is symbolic of the battle between reason and emotion. For every argument that Ram put forward, Ravan countered with a very clear, logical reply. The more Ram reasoned with Ravan, the more reasons Ravan had, to justify his position. Till of course Ram used emotion and went and won Ravan's heart. And the rest is history.
So why should I be quoting this little story for an article that deals with "impact of economic slowdown on advertising budgets and its long term implications"?
The answer, as they say, lies in the telling.
To come back to the world of today, let's have a look at what we are facing. Recession days are here again. And advertisers are doing what they love best - Cutting back on advertising spends. So we bring up the inevitable question all over again. How will cutting back affect the "brand" over the long-term?

As I see it there are two typical ways marketers address a recession
1. Resigning to the fact that there is no point in throwing good money after bad and pulling back on spends altogether
2. Pushing the envelope way, way out and going for all-out brand building.

We see very few companies indulging in the latter, with the first option being everybody's favourite route.

As a corollary to the first route, most companies are falling all over themselves in a 'price-off' bid to win the consumers wallet. Of course, who doesn't love a price-off? But what is worrying about this is that at the expense of a price-off promotion, it is the brand's 'value' that is eroding at an alarming pace.

Creating value around a product is what all of us strive to do, day in and day out. As Coca-Cola's COO, Steven J Heyer so succinctly described it, "Coca-Cola isn't black water with a little sugar and a lot of fizz anymore that one of your movies is celluloid digital bits and bytes, or one of your songs is a random collection of words and notes. Coca-Cola isn't a drink. It's an idea. Like great movies, like great music, Coca-Cola is a feeling."

I think he spoke for the entire gamut of advertising and marketing when he expressed it this way. We all know that our consumer taps into a feeling, or the emotion that a brand radiates, rather than respond to cold, hard reasoning.

And we all know that in a world where our consumer is getting more knowledgeable, more sophisticated, more risk-averse (especially when the economy is going through a downturn), building on emotions and feelings are being postponed for fair-weather days.

History has many interesting anecdotes of how companies who continued to invest in marketing and brand building during a recession went on to become category leaders and some of America's most successful brands. On hindsight it all seems pretty clear. The companies who didn't have a significant advertising presence caused their consumers to feel abandoned and thus drove them to a more aggressive suitor. It looks like distance in this case really didn't make the heart grow fonder.

1978, while those who cut advertising were ahead by 79%. During the 1981 recession, sales of companies that were strong recession advertisers had risen 275%, compared to an increase of 19% growth for those companies that decreased spending. * In 1982, Cahners Publishing Company & The Strategic Planning Institute studied 2,000 businesses to explore the relationship between market share and profitability, and advertising's impact on this relationship. As it pertains to our discussion of recessions, the study found that businesses that increased media spending by up to 28% had a .5 market share increase during periods of recession, and those that increased 28-80% increased market share by 1.5 share points. During expansion times, however, those that increased spending up to 28% saw a .2 share increase, and those increasing 28-80% also had a .2 share increase. (See Chart “Media Advertising Expenditures”) In other words, the study suggested that "a recessionary market condition can provide an opportunity for a business to break from traditional budget-cutting patterns and build a greater share of market through aggressive media advertising. In fact, the study

A case study from brands of the Great Depression (1929 through 1941) Procter & Gamble
A company with history like P&G has obviously weathered many a recession and its philosophy of not reducing advertising during down economic periods has generally resulted in progress in each of the last major recessions. As stated by Ira Matathia, CEO of Brands Future Group, Young and Rubicam, "P&G's progress in every one of the last major recessions is no accident. Everyone let up the gas on spending and Procter was smart in increasing spending."

Historically, P&G's philosophy of spending during economic downturns dates back to the Great Depression. The Great Depression caused hardship for many U.S. corporations as well as for individuals, but Procter & Gamble emerged virtually unscathed. Radio took Procter & Gamble's message into more homes than ever. Then a variety of products such as Camay, Ivory and Lava Soap were promoted on product-oriented shows, almost like infomercials. But in 1933, in the heart of the depression, P&G went into radio in a new way, and took a risk that changed the company, and the medium. The president of P&G at the time, Richard Deupree, believed people were still buying essential household products and saw the opportunity to capture market share, despite protests to cut advertising from shareholders.

His idea: create compelling serial programming for the radio networks that did not focus on a product, but was clearly sponsored by a product. Hence, the beginning of the daytime "soap operas" and an advertising model that still exists today.

The first P&G radio soap opera to debut in 1933 was "Ma Perkins," sponsored by Oxydol. Satisfied with the ability of this show to successfully increase sales, P&G went on to develop "Vic and Sade" for Crisco, "O'Neill's" for Ivory Soap and Forever Young" for Camay. By 1939, P&G was sponsoring 21 radio programs, and virtually doubled its radio spending every two years during the depression. In 1935, P&G spent $2 million on radio. In 1937, its radio spends totaled $4.5 million, and by 1939 radio spending topped $8.8 million. "P&G virtually built daytime radio for the networks and became the leading radio advertiser by the yardstick of number of periods of time on the air." Looking ahead some 50 years to the recession of 1990-1992, P&G's strategy of marketing fortitude once again prevailed. Procter & Gamble was the only marketer among the five biggest U.S. advertisers to increase spending in 1991. P&G managed to increase sales and earnings during this period (the late 1980s to early 1990s) and company sales surpassed the $30 billion mark in 1993.

It would be good to remember that during a recession the consumer doesn't go away. Instead he becomes more discerning. He looks for that ephemeral quality - value

A case study from brands of the 1990-1992 Recession:
While the previous example was meant to highlight a classic American brand that rose to prominence despite the worst economic depression of the 20th Century, more recent examples of brands emerging during recessions can also be found. This supports the premise that "marketing-driven opportunities always exist, even in difficult economic times." As you will see, this applies even to big-ticket items such as computers and automobiles, which are generally considered to be the kinds of purchases most impacted by a soft economy.

Dell Computers
Technology maverick Michael Dell founded Dell Computers in 1984. The company was based on the direct-to-consumer model, which eliminated the retailer, allowing for price discounts and constant customer feedback. In 1988, spurred by growing investor interest in technology stocks, the company went public. But it wasn't until 1991, the height of the 1990-1992 recessions, that Dell chose to make its most aggressive marketing move up to that time, and take on the established computer giants. The campaign coincided with the introduction of its first notebook computer. In 1991, advertising in the entire computer hardware category was down by 17.5% over the previous year. Apple, Digital, IBM and Tandy - some of the category's leading spenders - all made significant spending cuts in the range of (-25%) to (-40%). At the same time, Dell increased their marketing dollars 346% to $6 million, up from just half a million in 1989 and $1.4 million in 1990. While Dell was still not spending in the amount of the computer giants, its message - eliminating the middleman while offering superior customer service - seemed to hit home with consumers. Perhaps the marketing cut backs by its competitors offered the opportunity that Dell needed to break into the consciousness of the mainstream American consumer. The following year, Dell was included for the first time in the Fortune 500 roster of the world's largest companies. By 1993, the company was among the top 5 computer system makers worldwide, and in 2001, Dell became No. 1 in global market share.

But the issue at hand is not just the worrying aspect of budget cutback or consumer abandonment during a recession. It is a shade more insidious.

It is about the easy selling of a brand's soul. At 50 paise less than the competitor's. It's about companies trying to create differentiation at the price point. Whether it is automobiles, FMCGs, mobiles, consumer durables, garments, electronic equipment, airlines or any other category - manufacturers/competitors are matching product feature to product feature, price point to price point. The result - the consumer is beginning to fall out of love with a brand that sells itself so easily.

It would be good to remember that during a recession the consumer doesn't go away. Instead he becomes more discerning. He looks for that ephemeral quality - value.

So what could be a possible solution?
Converge the two traditional routes and innovate. Refocus. Reprioritize. Offer value but not at the expense of the brand's values.
Focus on core values and build lasting brands.Core value focus used to be achievable with a single strategic execution. Now core values need to re-expressed with greater variety. Continuity of messaging is critical, interpreted through a variety of themes.
Use media innovatively to get the most out of it. Using the same traditional media that we do, will subject them to the same declines in its efficacy and threaten their results.
Expand the target audience. As brands mature, they will need to rejuvenate the target audience for brand health and they may also need to redefine the target audience.
Discover the joy of relationship marketing. Relationship marketing will become a fundamental part of brand communications in a fragmented media environment. Database construction will become a vital part of brand activity.
Focus only on powerful promotions. These will surround the brand with a more powerful halo. In this process, the corporate brand identity becomes more important as it adds leverage.
This is where I bring up the Ram Ravana interpretation again. As has been so well expressed, the battle should be won, not with the swift repartee that reason provides but with the total takeover of the consumer's heart. As Pascal put it, "the heart has reasons which reason knows nothing of".

The heart will find a way - to justify holding on to a brand through good times and bad.

As long as we, as marketers make sure that we find our way into peoples hearts, and, then their minds. In that order.
For when it comes to a battle for the wallet, it is almost impossible for reason to win without the co-operation and collaboration of the heart.

With research and editorial support from
CVS Sharma and Minnie Abraham

References:
1. Jay P Pederson, Editor, International Directory of Company Histories,
2. Advertising Age's, The House that Ivory Built (Lincolnwood, Illinois: NTC Business Books, 1995), p.18.
3. David Powers Cleary, Great American Brands (New York: Fairchild Publications, 1981),
4. "More Companies Cut Marketing as the Economy Falters, But Opportunities Remain as Winners from the Last Recession Show," Copernicus Magazine, October, 2001. Competitive Media Reporting (CMR), media expenditure data
5. Dell Corporation, 2001, "About Dell"
6. Ibid, quoting "How Advertising in Recession Periods Affects Sales," ABP, 1979.
7. "Media Advertising When Your Market Is in a Recession," Cahners Advertising, as reprinted in "Making a Recession Work for You," ABP
8. "Going Beyond" by Rishi Prabhakar

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