RETAILWIRE DISCUSSION TOPIC
Top Marketers Increasing Ad Budgets – 2/5/08
The economic news of late hasn’t been great and many companies are expecting a tough row to hoe ahead, but top consumer product marketers are increasing or maintaining ad budgets instead of seeking cuts, according to AdAge.com.
Some national brands are increasing spending in an attempt to hold back a push by private label offerings and maintain consumer equity until the economy picks up again.
Discussion questions: Do you expect that most companies will look to increase or maintain marketing expenditures this year? Why? What will higher or lower marketing expenditures mean for companies/brands when the economy improves?
Economic downturns are always an opportunity for strong companies to grab market share by maintaining and even increasing marketing spend. Marginal players will likely be unable to reduce spending elsewhere to be able to avoid reductions in ad budgets. They will suffer as a result.
The impact of store brand growth is also a factor – particularly as the stronger retail players also step up their ad budgets to grab market share. The big CPG companies will keep up ad spending, but need to do so in a way that engages the consumer. This will mean stronger investments in direct, electronic, and social media – not just more print and TV/radio.
Mike Osorio, your Dare to be Contagious! ™ strategist
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