The seven booklets, written by senior members of the agency in various markets and overseen by new Asia-Pacific chairman Tim Isaac (pictured), approach the topic of recession marketing from several angles, including budget, production, creativity, sales and digital. They target marketing and finance directors.
According to Isaac, Ogilvy’s initiative is designed to “alert clients to the possibility that they can have a constructive discussion with someone”. He added that rather than simply seeking to encourage continued investment, Ogilvy had taken the recession as an opportunity to advise clients on streamlining measures “that should be done anyway”.
The key points of the booklet, available at ogilvyonrecession.com, are that companies should view a downturn as an opportunity to increase share; indeed, marketing spend can grow share more quickly than in times of economic growth. It also details the metrics marketers need, including contribution to profit and shareholder value. Other advice includes exploring new media channels.
“We wanted to find a way of getting to the most senior clients and look at how they should be reformulating their communications plans,” said Isaac. “Ten years ago, there wasn’t really a single effectiveness model. Now, there is an indication that the industry is becoming more responsible and has grown up. You have to ask how to use a budget more effectively. It’s not a question of spending less and doing the same things as before.”
Much of the information comes from previous recessions in Western markets. However, Matthew Godfrey, chief executive of Publicis Asia, argues that the principles remain the same. “You can’t just stop advertising and then do nothing. People are asking how they can maximise what they have and do more with less. The big fear is that people make cuts and don’t change. The message is that you need to rethink your market approach - you don’t have to do nothing.”
According to Malcolm McDonald, emeritus professor at Cranfield University School of Management in the UK, recessions can “focus the mind” and lead agencies to “cut out the waste”. He advises brands to focus on core customers in needs-based segments, adding: “Whatever you do, don't cut promotional expenditure in the core business. [There is] massive evidence that cutting promotional spend in a recession is disastrous.”
Paul Hu, director and head of marketing at Volkswagen Group China, argued that the advice was well timed. “An agency in a time like this should go beyond its usual scope to provide value-added advice,” he said. “I appreciate the fact that Ogilvy has taken shareholder value into consideration.”
However, one Hong Kong-based marketing director noted that although Ogilvy was right to be targeting finance directors as well as marketing directors, with cost-cutting remaining a priority, ad budgets were still likely to be reduced.
Other agency heads, including Chris Jaques, M&C Saatchi’s Asia chief executive, and Publicis’ Godfrey, indicated that insight into changing consumer habits would be as valuable to Asian marketers in the current climate as theorising based on past events. “Asian clients want to understand how people are changing their behaviour now,” Jaques said.
Nonetheless, Godfrey conceded that the fundamental message - that a recession provides an opportunity to grow market share - is a valid one. “If Ogilvy gets that debate going, it will be worthwhile for the industry.”
According to Isaac, the reaction from clients to the recession will shape the relationship between agencies and clients for the future.
“The question will be, ‘Can agencies remain valid partners to their clients?’ The response to this crisis will be very telling as to whether we have a place at the table going forward.”
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