Effective and inexpensive advertising during a crisis. Crisis in the minds: Heads of advertising agencies on the future of the market

Why do companies increase their advertising budget during a crisis?

A crisis is an unpleasant phenomenon that in one way or another affects all large and small companies and organizations.

In people becomes less money , as a result demand for products comes from, selling something is becoming increasingly difficult. At the same time, rent for office space, retail premises no one, of course, downgrades, wages employees need to be paid, others no one can cancel necessary monthly expenses.

In such conditions can't stop not for a minute, you need to constantly look for ways to reduce costs, optimize business processes, increase sales, just to maintain your position in the market, don't lose customers. The work of the formula “movement is life” has never been better demonstrated.

During a crisis, the question of reduction in advertising budget.

Some managers see this as one of the effective ways to reduce organizational costs, a way survive the crisis with minimal losses, taking advantage of old customers and not attracting new ones. And they look with disapproval at companies that are in difficult economic conditions vice versa are trying to invest more and more in advertising.

What is the result?

Also, in difficult economic conditions, buyers will look for more profitable opportunities for themselves, and, quite likely, they will find them and will choose another seller.

How do they find out about attractive offers from another company? Of course, with the help good timely advertising.

Sales will decline so much that over time there will simply be no way to pay salaries, rents. Working with the remaining clients and buyers due to lack of funds will become impossible. Market positions will be irreparably lost.

The organization will gradually come to its closure.

What will happen if the advertising budget is increased?

After all, this would seem to be just unnecessary expenses. Why offer something more and more actively when people simply don’t have the money?

In fact, everything is much more complicated.

So, the company, under the influence of crisis phenomena in the economy, decides increase your advertising budget.

Why?

The logic here is this. In order for the buyer to pay attention to your product in normal economic conditions, you need to spend 1 USD. And in times of crisis, when people have little money, They forced to cut their expenses, carefully plan them, in order to sell your product, you need to spend 2 USD.

Let us remember the famous phrase of Henry Ford:

“If I had 4 dollars, I would spend 3 of them on advertising.”

Why is this position relevant in difficult economic conditions?

At a time when it is incredibly difficult to keep your business afloat?

Firstly ,investing more in advertising, you will be able to maintain sales at a more or less normal level, which will allow keep your company running.

Agree, in difficult conditions, when many organizations are forced to close, even breaking even or operating with minimal losses is already good news.

Secondly, good advertising V crisis period will allow you to save, strengthen and even increase your position in the market, in conditions when competitors refuse advertising altogether, or decide not to change anything, hoping for chance.

If the buyer decides to spend his little money, he will buy the products from you.

An unpleasant surprise for operators outdoor advertising At the end of the year there were two news:

The agency cited two reasons for the rating downgrade. Firstly, the increase in placement costs, which is the result of bidding for outdoor advertising, which took place in Moscow in 2013-2014. During these biddings, a significant increase in prices for the right to place advertising structures was noted; the cost of one structure also increased due to increasing the price for approval of installation from all authorities.

The second reason for the downgrade was the worsening economic situation in Russia. According to agency specialists, the influence of this factor is manifested in the fact that outdoor advertising operators will not be able to fully compensate for the increase in placement costs by increasing prices. An increase in prices for outdoor advertising was recorded already in the fall; the dismantling of old structures was completed only a year later, which deprived the Gallery company of part of the expected income from the price increase.
Prices for outdoor advertising are a sore point for the entire industry; during a crisis, the price of one design becomes an automatic item in the loss column rather than profit, since it will not be easy to find advertisers to place on each billboard, whereas in normal times such a billboard would be a source stable income due to a continuous queue of orders for advertising space.

2) Banks cut advertising costs for the first time since the last crisis

As the newspaper Izvestia reports: Izvestia studied annual statistics banks' advertising expenses - from October 1, 2013 to October 1, 2014. It turned out that during this period, banks reduced advertising costs for the first time since 2009 - by 12.1%, to 22.5 billion rubles. As of October 1, 2009, the drop in the indicator was 28.9% (to 9 billion rubles), after which, over the course of 4 years, progressive growth was noted, the rate of which reached 50%. This follows from the profit and loss reports of credit institutions (Form 102), which the Central Bank publishes quarterly.

Banks are one of the most attractive advertisers and in the long term you should not expect an increase in the advertising budget in this sector of the economy. The advertiser will “go online,” where advertising costs are not lower, but are offset by the ability to track and calculate user metrics.

How to advertise during a crisis?

Not all markets are experiencing a decline in activity; at a recent forum in St. Petersburg, representatives of the construction market in Russia noted not only a commitment to old conservative advertising formats with wide coverage, but also a slight growth trend:

Agencies promote specific offers, so their tool is line advertising. The developer has larger budgets, so not only line and contextual advertising is used, but also wide-ranging advertising. We optimize advertising budget, focusing not on the crisis, but on conversion

Daria Baranova, Marketing Director at O2.

We can’t say anything about the impact of the crisis on the choice of communication channels - everything is fine with us

Elena Kovalenko, Deputy Head of the Advertising Department at KBC

Crisis sentiments are dangerous not so much for companies representing the market; they can either cut costs or play with the price of structures, focusing on demand. The danger lies primarily with the advertiser who is tempted to cut back. most of budget spent on seemingly meaningless brand development in a situation of declining demand. However, closing promotion channels means leaving without a fight, and also dooming yourself to the position of an outsider at the moment when the consumer chooses a brand that has served him faithfully in difficult times. It won't necessarily be an "economical" product, but we can say with confidence that it will achieve reliable status.

This is not the first crisis in Russia; the memory of the 2008 crisis is still fresh, when the advertising market shrank by almost a third. During this time, many professional communities have compiled not only instructions for overcoming specific crisis situations, but also analytical reports containing an “outside view” of the problems that large advertising agencies have faced and overcome in the most difficult circumstances for advertising producers. With translation from one of the best complex works ACAR (Association of Communication Agencies of Russia) introduces us to the European advertising market.
Full version research "How agencies can reduce the impact of a recession" on the website Akarussia.ru

In addition to the certainly useful market research, the Association publishes its own advice, addressed primarily to community members who may report violations either from the client or from an unscrupulous competitor. Protection is a top priority intellectual property and insurance of tenders. In essence, the guide to action is a good defense textbook in difficult situation. Instead of an aggressive policy of market capture, specific steps are proposed to control the current situation, to build competencies and increase customer loyalty through the quality of services provided.

- What would you advise Russians during the crisis that began in 2015?

- We need to have fun, spend money. The crisis is not only in Russia, but throughout the world. I don't understand why we ended up in this situation. This is a problem all over the world, and it seems paradoxical, because there is enough money in the world. You need to change your attitude towards life, your worldview.

Good advice not only for end consumers of advertising, but also for players in the advertising market

A crisis does not arise suddenly in financial markets, but in people's minds. It is impossible to say that the country today is mired in an economic crisis, which is associated with the collapse of the economy. Most companies are at a low start for implementation anti-crisis measures in order to maintain business stability, and, believe me, the majority marketing plans already have traces of “anti-crisis” programs. For example, many are planning to freeze budgets for advertising activities in the second half of 2014.

But this is not a collapse in consumer and financial markets. There is a decline in consumer activity, and there are crisis expectations among top managers. Today, everything is being done to minimize the consequences of the recession for business.

We feel the recession due to the fact that the advertising business is a derivative of any production activities. If there is a decline in consumption, then the dynamics of investment in advertising decreases - budgets are redistributed in favor of channels that have a higher conversion into subsequent sales of goods, costs for image projects are reduced.

The general euphoria around Sochi allowed decision-makers and ordinary consumers to be distracted
from negative moods

Despite this, the first quarter of 2014 was probably the most interesting in my many years of activity in advertising business. There was no reduction in consumer demand for durable goods, advertising investments only continued to grow (compared to last year, the company showed an increase of more than 40%).

The general euphoria around Sochi allowed decision-makers and ordinary consumers to distract themselves from negative sentiments. Those who were unable to get distracted directed all their savings (some saved for an apartment, some for a car, some for a vacation) to purchase durable goods, and therefore from car dealers, as well as in electrical households. There were queues in retail.

At the same time, the weakening of the ruble affected almost everything manufacturing industries- from FMCG to durable goods. The final forecast for the advertising market 2014/2015 can be given closer to September. We all remember that for Russia August is the most significant month in terms of internal political and internal economic changes.

If we look at the beginning of 2014, the situation in advertising industry practically unchanged compared to last year. We can say that the level of advertising activity of clients remains at the same level: it is not growing, but it is not decreasing yet.

We haven’t felt the crisis yet, but we see that compared to previous years, the growth of the advertising market has slowed down. While TV and digital are expected to grow at around 10 percent, other media are stagnating. During a crisis, a slowdown in GDP growth provokes a slowdown in consumer activity.

The share of large FMCG advertisers is growing, consumption of durable goods is decreasing, so these manufacturers will cut budgets. Based on the experience of previous crises, we can say that the media that survive are those that are effective in terms of return on investment: TV channels, top radio stations and printed publications, the most popular equipment in outdoor advertising and Internet resources. The share of strong media players becomes larger, the share of weak ones becomes smaller, or they disappear altogether. Companies are more often turning to channels that are not aimed at image, but can sell products cheaply and effectively.

Now we feel the crisis only on one project. I don’t know what will happen next, but there is a feeling that globally this will only affect large network agencies and companies that work a lot with Western contractors. We cooperate with a Thai retouching studio, the amount in the contract with them is stated in dollars, and with the client - in rubles, so, of course, we are now losing money due to the fall of the ruble.

But globally nothing has changed. I have a feeling that this is more of an exaggerated crisis than a real one; it is clearly artificially created from the outside and manifests itself only in relations with Western companies. Moreover, this does not apply to companies that have their representative offices here.

Usually during crises there is a redistribution of clients - I think we will only benefit from the crisis,
if it really happens

It doesn’t affect our plans in any way, but it’s easier for us: we always try to work with a small amount large clients. We have not yet heard from any of them about reducing budgets or freezing projects. But even if something serious happens, I’m sure we won’t have any big problems. Usually during crises there is a redistribution of clients. Often, large companies, cutting their budgets, stop working with large agencies and begin to turn to small boutique agencies, because the total costs are lower, and the level of services and creativity is the same, and sometimes even higher. So, I think we will only benefit from the crisis if it really happens.

The advertising industry is no stranger to crises. Especially for those companies that work with tobacco or alcohol brands. The crisis strengthens and teaches us to do not spectacular, but effective projects, where every consumer is worth his weight in gold. Within the agency, we understand that financial instability is coming. A number of our clients have already optimized their budgets. And not in favor of digital marketing. The forecast is generally comforting: yes, during the crisis there will be fewer creative projects using non-standard approaches from phygital to transmedia, but no one canceled the same efficiency. We, as agencies, need to understand how we can achieve goals and solve client problems in an even tougher competition with other communication channels. The struggle for the marketing budget promises to be serious, and the strongest will survive.

Any crisis is a great time to enter the market. Competitors are weakened. Clients are looking for new solutions. They are disrupting the usual course of business. In such situations, cash is the king (the main thing is cash. - Note H&F). We prepared, put aside cash so that in times of crisis we could invest in our infrastructure, so that existing clients would not feel a crisis in working with us - money and resources would help us absorb competitors and capture new niches.

My clients began to report that they were seeing a drop purchasing power population. That is, people have already begun to consume less. For example, I heard that Unilever is removing budgets for non-priority brands. This means that everyone begins to sense the problem.

Tenders appeared, which were then cancelled. We already went through this in 2008. At first he is satisfied, and then it turns out that there is no project, or they simply do not allow him to do anything. This happens when employees large companies trying to keep themselves busy so they don't get fired. We need to do a couple of tenders to show that everyone is working. There are no budgets. The content of the messages in the briefs has also changed - now there are only “sales”. Previously, the goal was both to sell and to do something for the image, now this is not even considered.

It will be protracted, as it is associated with internal problems the country's economy.

The Russian advertising market is facing a more serious crisis than in 2008-2009, say media company executives interviewed by Vedomosti. The economic crisis that broke out in Russia after the imposition of sanctions by Europe and the United States and the fall of the ruble exchange rate will be more serious and protracted than the previous one, they explain. In 2008, economists did not expect such a drop in consumer demand as now, and the ruble did not depreciate so rapidly, says BBDO Managing Director Andrei Brayovich. The economy is undergoing serious and structural changes, agrees IMHO Vi CEO Maxim Osipov.

Thus, the decline in the TV advertising market this year will be stronger than last year. financial crisis, the heads of major TV channels are confident and advertising agencies. In 2009, the entire advertising market in Russia fell by 27.5% to 186.4 billion rubles, and advertisers' spending on TV promotion decreased by 18% to 96.4 billion rubles. (data from the Association of Communication Agencies of Russia, AKAR). Vedomosti's interlocutors refused to predict exactly how much the TV advertising market will fall this year. It is almost impossible to make accurate forecasts when the macroeconomic situation is changing so quickly, they say, as well as employees of other media companies - outdoor advertising operators, radio companies, Internet holdings and publishing houses.

On at the moment Federal channels assume that their revenues could decline by more than 20%, said representatives of two major television companies. This applies to both channels working with Vi and those working with the Gazprom Media seller. And this situation is also noticeably different from the crisis of 2009. Celler Vi (formerly Video International) at that time worked with advertisers under multi-year contracts, while Gazprom Media had mainly annual deals. As a result, the decline in income for Gazprom Media channels was much more significant than for channels working with Vi. Vi later reported that its channels lost only 8% of their advertising budgets in 2009. This year, the channels serviced or consulted by this seller (a total of 17 channels work with it) will face a much more severe drop in income, Vedomosti’s interlocutors are sure.

A Vi representative again told Vedomosti that there is no official forecast for this seller for this year. The general director of the Gazprom Media sales house, Sergei Piskarev, did not answer Vedomosti’s call yesterday.

For the media, this year will not only be worse than 2008, but even worse than 1998, says Mikhail Berger, general director of the Rumedia radio holding. In 1998 there was sharp drop exchange rate and a relatively rapid recovery, in 2008 there was a smooth decline and the same recovery. “During the last crisis, it was possible to predict the future, at least a little. This year, for the first time, we don’t understand what awaits us next month,” he laments. According to him, companies that have planned a 20% reduction in revenue in this year's budget will be able to cope with the crisis. But he refused to make market forecasts for 2015. According to Kommersant FM founder Dmitry Solopov, in January radio stations recorded a drop in advertising revenue of 30-40%. The same will happen throughout the year, he suggests.

General Director of the Komsomolskaya Pravda Publishing House Vladimir Sungorkin says that there is not enough data for an accurate forecast, but the company is still proceeding from a pessimistic scenario in which newspapers will lose 30% of advertising: “If the scenario comes true, it will definitely be much worse than during the 2008-2009 crisis gg."

However, not all experts are so pessimistic. The same Goldman Sachs predicts that the entire advertising market this year will decline by 15-25%, including the income of television channels - by 20%, and print media - by 25%.

In the previous article we already dealt with marketing fundamentals the basics of what to do and what not to do during times of crisis in your business. And, as you remember, we agreed that the emphasis should first of all be shifted to regular customers.

Let me make a reservation right away - there is no such thing as “anti-crisis advertising” or even “anti-crisis marketing.” Advertising at any time can be either effective (profitable) or ineffective (unprofitable). But if in relatively calm times you can afford to lose some money for the sake of “experience,” then with the onset of a crisis, every penny counts.

So, let's figure out what and how...

Step-by-step strategy for analyzing advertising campaigns

1. Start “turning off” your advertising channels one at a time.

Let's say your typical advertising channels that you have been using for the last ten years are advertising in a local magazine, a banner on the main page of the city website, and putting flyers in the mailboxes of civilians "in the area." You regularly invest money in all this, but (and most likely I won’t be mistaken) you don’t really know what brings clients and what doesn’t; from which channels there are more people, and from which they are cheaper... If you know, I can only congratulate you - you are not afraid of the crisis.

So, start cleaning one channel at a time. For example, first don't pay for advertising in a magazine (for 1 month) and see what happens. If absolutely nothing happened - as many clients as there were, as many remain, then it’s time to admit that you’ve been funding the magazine all this time in vain. If there was a visible outflow of clients (and statistics analytics on client base will help clarify this issue) - which means promptly return your advertisement to the magazine.

After you have decided on one channel, you turn off the next one... You make a decision on it... And so on until you find out in practice which hole the money is going into. Of course, only cost-effective advertising channels (those that bring in more than you put into them) should be kept funded. If the channel is working at zero, we also leave it (this is necessary for scaling the advertising coverage).

2. Distribute your advertising budget in shares.

Suppose, after you implemented the previous point, it turned out that only putting out flyers works for you, which means that N money was freed from the advertising budget. The question arises: where should they be invested (and should they be invested)?

And then (lo and behold) a friend tells you about targeted advertising in social networks. He says the efficiency is terrible. And you’re already on fire, you can’t wait to throw all your free money into attracting new clients in one fell swoop, but... Out of nowhere, another “ knowledgeable person"strongly recommends that you hang up a billboard, citing its location in the very streaming segment of the city...

What to do? Pour all the money into the instrument whose advisor sings more beautifully?

No way!

IN new advertising you should invest very carefully and in literally minimal doses. Therefore, if you are so sure that the billboard will work, pay for it, and use the rest of the money for targeted advertising. And under no circumstances, do not take money out from anywhere else (although better business in a crisis than a business on credit). Until you know the profitability of an advertising channel, do not invest more into it than you are willing to lose.

3. Carefully consider the effectiveness of advertising.

Let's continue to develop the example from the previous paragraph. What needs to be counted and why?

— the number of conversions (or the amount of money) you earned thanks to customers who came through the advertising channel under study; (we will talk about how to track this in the 4th paragraph of the next paragraph);

— the cost of one attracted client (just divide the amount of money earned by the costs).

You can add a lot more here - all sorts of ROI, the number of “dry responses” (without a purchase), long-term value of the client... (I’m sure you can understand whether the investment was profitable based on these three figures, even the first two are enough). But if you start counting even this, you will already be ahead of the vast majority of competitors.

There are 2 fundamental reasons why all this is really worth considering:

- to be able to compare a more profitable channel with a less profitable one, and redistribute cash injections.
In short, I won't be in once again remind you catchphrase John Wanamaker. Just accept it as a fact that if you can’t name the numbers behind your advertising at night with your eyes closed, you have no control over anything.

4. Track sources of client traffic.

Ok, you did as expected and, within the available funds, paid for hanging a billboard and targeted advertising on VKontakte. But, uh... How can we now understand which client came from where (if both the phone numbers are the same)? Or did they need to be launched one by one?

No, everything is much simpler:

— indicate different telephone numbers;

— different emails;

— identical website pages, but on different subdomains;

— different chants for which you will give bonuses;

- offer different gifts;

Difficult? Not so much. But without this, again, there can be no talk of any controllability. Chaos, hardcore and the ever-increasing immersion of business into the crisis and its economic abyss.

Well, yes... I hope you will be pleased that such statistics are immeasurably easier to maintain on the Internet than offline. The same targeted advertising is easily controlled at all necessary levels by built-in analytical systems. This is the beauty of the Internet - extremely easy access to analytics and the ability to instantly influence it. Well, use it!

5. Test your ads relentlessly.

And now that we have figured out what to do and why, I will try to knock out a cozy chair from under your ischial muscles...

Even if you are an advertising and marketing professional who has eaten a dozen dogs in your product and in your industry, you will not be able to write and design an advertisement that will work “at the peak” of its capabilities the first time. At best, it will pay off.

So what to do?

If there were prosperity and growth for all outside the window, I would tell you in detail about a consistent series of tests, even for unprofitable advertising (if it appeals strictly to its target audience). But since we are in difficult times, remember the main thing:

1. We simply turn off unprofitable advertising and don’t worry about it.
2. We test advertising that has paid off. Tests involve sequentially changing key components one at a time and observing. Let me explain on my fingers. Let’s say you launched a newsletter to your partner’s client base. And it seems to have paid off. Now do the same, but change the title (subject of the letter). Did the results get a little better (how much better; are you sure you took into account all the numbers?)? Great, leave it new option. Now test the presence of prices in the price list (they were not there, but you will add them). Have your results dropped? Return the previous option... And so on until you run out of elements.
3. Be prepared for the fact that the results of the vast majority of tests will differ very slightly from each other. But even if you don’t find a revolutionary option, consistently improving each element by at least 3% of the total mass is a big deal.
4. Well, now the most delicious... The best options found - replicate in other advertising channels (but only options tested on yourself). After all, if the title, text and picture worked perfectly in the newsletter, it means that in contextual advertising their chances are higher, both in a newspaper ad and...

P.S. To give specific examples, especially with numbers (and by the way, I know my numbers by heart) would be stupid and inappropriate here (it won’t be about you anyway). So, strain yourself (at least in a crisis) and do everything according to science, from your own experience.

Anti-crisis advertising formula.

And again I'm going to lie to you - there are no anti-crisis advertising. And what I will say next is constantly distorted by numerous authors of business books in every possible way. And although these books often become bestsellers, for some reason there are no more working advertisements.

1. Your advertisement should contain at least:

- title;

— the ad text itself (which clearly and unambiguously answers the question of what client problem it solves);

— limitation;

— a call to action (I’m sure you know what this is);

— contacts for communication (as you remember, they should be different in tracked advertising channels).

1. Now read the previous paragraph and make each of the elements as attractive as your creative and financial capabilities allow:

- add a bonus to the title, special offer, 2 for the price of one, delivery (at least something that will set you apart from the competitive mass of identical goods and services and make you attract attention);

- I repeat once again - the text should not be about your product or service or their functions; the buyer wants to understand how these very functions will solve his needs - that’s what you’re talking about; (that is, not “tangerine”, but “New Year’s mood”, not “universal suit”, but “a suit that is perfect for work and for relaxing with friends”, etc.);

— in short, either the product, or time, or the number of bonuses must be in short supply (otherwise, why make a decision right now?); So enter the following restriction: “only for the first 10”, “13 copies left”, “only until 22.12.” etc.

- not just “click”, but “click the button, fill out a special form and our specialist will gallop to you on a white horse within the next five minutes” (do you feel the difference?);

— I think you’ll sort out the contacts.

Any “creative”, “sub-meaning”, “hints”, “floridness” and other near-literary heresy are punishable. Be direct, concise and as accessible as possible. Not only children, but even a fool could understand.

P.S. A gift from me personally. Since we are talking about a crisis, use the formula:

1. The key distinguishing characteristic of your product or service.
2. The very name of your product and/or the group it belongs to.
3. Dash (like this “-”)
4. The word "best".
5. The name of your product group.
6. The phrase “in crisis”, “in times of crisis”, etc.

It turns out something like: “The energy-saving refrigerator “Omorozko” is the best refrigerator for times of crisis.” Or: “Relaxing massage “Nirvana” is the most cheap way relieving stress during a crisis.” (If anything, you can also be creative within reason).

P.P.S. Working with advertising (both in the sense of composing advertisements and in the sense of subsequent analytics, correction, tests, etc.) is a serious matter. Therefore, I ask you, find either time or a specialist (whom you can afford) - it will still come out cheaper than the notorious “gravity” or doing advertising from time to time.

Let's sum it up

1. Start consistently turning off the ads you use and see (in numerical terms) what happens. Keep only what is cost effective.
2. Invest your advertising budget in small parts into several channels at once.
3. Conduct analytics carefully and calculate key indicators.
4. Turn off unprofitable advertising channels (even if they are directly related to some segments of the target audience) and forget about them until the crisis is over.
5. Test your ads until you're blue in the face (if, like me, by blue in the face you mean " maximum efficiency"). To do this, change each element sequentially and track the results.
6. Replicate the best ads across all available advertising channels.
7. Make up your own advertisements under the guidance of some smart book or at least an article (you can even do this, but I don’t insist) or hire a specialist.

That's all for today. Enjoy, ask questions if they appear (if not, they will appear). Well, don’t forget that you can express your wishes on “anti-crisis topics” and in general.

P.S. Previous material from the series “Business in Crisis” -.
And the next one.