Simon is considering his Social Media status

I’ve been doing a lot of work with Social Media of late and unsurprisingly everybody’s first point of reference if Facebook. It seems to take a bit of effort to get clients to think bigger than Facebook sometimes and it can be even trickier getting them to realise what they can actually do with the network itself.

We were discussing this for a client this week saying how great it would be if rather than simply creating a fan group we could get everybody to change their status to show that they were taking part in our promotion. Something like Alison Christie is loving the TNCC Mini-Movie Maker right now.

Whilst I really liked the sound of this I’ll own up to not really ‘getting’ the whole status update thingy. Anda Goddard is looking forward to buying a fish. Keith Halifax is sore from football. Simon Gregory is probably skiving work right now. Thanks for letting me that your life is more eventful than mine.

Then I came across a decent post by Grant McKracken on “Exhaust Data” (the posh term for status updates). He suggested that these updates act as phatic messages (where the function is to perform a social task rather than overtly carry a message) carrying a message in their own right:

"A 'newsflash' about my cat helps keep the network node called Grant McCracken from blinking out... But this is not just news that I am extant, but that I am, as much as this is ever true, emotionally and intellectually active."

A status update acts as a consistent reminder that I’m here, you’re here, we’re both OK, our network’s OK, and we can communicate whenever we want. Nice way to look at it. Rather strangely this reminded me of a random stat about marketing spend and return on capital during a recession.

PIMS International conducted a piece of research on ad spend during a recession looking at the resultant returns and market share when an economy starts to recover. Based on a wide range of companies they came to the following conclusions:





The argument that you’re better off spending during a recession is old ground, but the effects of maintaining spend were surprising. 3% Return On Capital Employed and 1% increase in Market Share during a dodgy period is pretty good! Is this the equivalent of maintaining your status update?

Is maintaining marketing presence a brand’s equivalent to us updating our status? We know that consumer confidence is vital during a recession so can, and is it important for, brands to send out similar phatic messages? We’re still here, we’re both OK, we’re still talking, we’re here when you need us, everything’s all good?

Simon Gregory is unsure what this means for the Social Media presentations he’s working on.

The silver lining to the cloud

It was my birthday this week and the usual “you’re past it” gags came out (despite only being 25 I might add!), so it somehow seemed fitting to write a bit about “The Recession”.

Yup, the economic downturn is now officially being mooted as the start of a recession and the conversations on what will happen to advertising/marketing spend have already begun.

Marketers were predicted to decrease spend by 3% at the start of the year whilst the latest Bellwether Report (Q1 2008) reveals that, for the second successive quarter, Q2 marketing budgets have been downgraded. Original estimates of a 3.2% increase in 2008 ad spend are looking ropey if reductions continue and this positive prediction is largely due to continued online investment counteracting reductions in more traditional media, especially below-the-line. (In fact, online spend has already overtaken press and it’s predicted to overtake TV by 2009.)

Now, I’m no economic analyst but I understand the logic that positions our friend the ‘marketing budget’ as one of the first victims of money-saving cutbacks. But, I’m going to stand by him – leave him be. In fact, feed him some more if you can!

The latest Brandz report from Millward Brown suggests that investing in a brand is actually one of the best courses of action during a period of economic turbulence:

“Strong brands generate superior returns and protect businesses from risk. Our data shows that strong brands continue to outperform weak ones in terms of market share and share price during recessions” says Joanna Seddon, CEO of Millward Brown Optimor.

Strong words, but there are also strong supports:

• Reports suggest that only 10% of consumers are motivated exclusively by price
• There are strong links between Share of Voice and Share of Market – invest and increase your share of voice whilst others are decreasing theirs and snatch their share of market as well
• Companies that have brands in the BrandZ Top 100 have performed significantly better in the stock market when compared to the S&P 500
• Loyal customers stay confident in a strong brand when the going gets tough. Confident customers are less likely to switch brand
• Potential customers, staff and shareholders are more risk averse during a recession. A strong brand alleviates risk in the shareholder’s mind
• There is a greater chance of a company’s value remaining buoyant in an economic downturn if supported by a strong brand

And there are cases to point to: P&G claim to have a “When times are tough, you build share” philosophy; Dutch retailer Albert Heijn tried to compete on price in 2003 only to trigger a price war that resulted in them losing share to competitors; and so on.

So could a recession become an opportunity? Perhaps, but it’s not just spend spend spend. As Millward Brown rightly points out, each industry requires its own recession strategy as each will be affected differently. Offensive or defensive, value focused or product focused, weather the storm, etc. Either way, a strong strategy utilising marketing spend is essential.

As for my own recession… well, 25 isn’t that bad at all. Really…