What's your attitude towards a downturn?

In a major downturn, not everyone has to suffer.

Already there are lots of mixed messages. The media reports that sales are up at the Victoria Market, while lots of other retailers are down. Yet retail plant nurseries have reportedly had a great Springtime.

Even in residential property the picture is not clear. All year prices in many areas have not reached the dizzy heights of late 2007. And since September the fall off in prices has been more dramatic. Yet on 20 November it was reported that sales in October had taken a jump. And builders have reported an increase in sales of new homes of between 30% and 50%.

In addition to all this, many mums and dads who are in work are finding things OK so far. The cost of running their car has dropped slightly and their mortgage is easier.

Clearly, we are looking at a variable picture with winners and losers.

In your business it is important to get your attitude right. Are you going to head for cover and hope it passes quickly? Or are you going to take the initiative and make good things happen? There is nothing that says you must take part in the downturn.

If your target market is feeling the pinch, this is a very good time for you to review your methods. It is almost certainly not good enough to just keep doing what you have been doing. There may be a very good case for more business investment in advertising or promotion or corporate gifts – or whatever is appropriate in your case. But whatever it is, think about it carefully beforehand and try to make yourself standout.

In moving to be successful during a downturn, my guess is that fortune will favour the brave.

Action Words writing tip

Clutter in writing is a major problem.
We seem compelled to add. Even in this piece on ‘clutter’ I started out with a first sentence that read: ‘Clutter in writing is a major problem for writers everywhere today.’ When I reviewed it, and cut it, the sentence became stronger.

Writing improves when you keep things out that don’t need to be there. Clutter is so much part of our writing today, we often don’t notice it. But I promise you, it’s there.

“It is interesting to note . . .”
“At this point in time . . .”
“It’s my personal opinion . . .”
“As has been pointed out earlier . . .”

If you are writing something that’s important to you, check each word and ask yourself, “is this needed?” If you can remove clutter, your readers will be pleased. You will communicate more easily.

Will your brand die any time soon?

Three leading academics at Monash University have produced an innovative approach to the lifespan of brands that will be featured very soon in the renowned Journal of Business Research.

The academics have put forward the idea that it is normal for brands to die!

Professor Mike Ewing, Dr Colin Jevons and Associate Professor Elias Khalil say that the idea of brands being invincible is a myth. Their study argues that brands have a finite life span, and companies that expect them to last forever are just not being realistic.

The Monash study argues that every brand moves through stages: from birth, through growth, to maturity. The final stage, death, should be seen as a natural part of this life cycle. And every brand, no matter how big, is vulnerable. Remember Ansett, Oldsmobile, Atari?

According to the researchers, consumers drive the rise and fall of brands. They say two factors influence people’s decision to buy: firstly, the product’s use value, or ‘constitutive utility’ (basically, what it does for them); but more importantly, its ‘symbolic utility’ – what it means to them.

Brands are driven largely by this symbolic utility: people buy them primarily to feel good about themselves. The power of symbolic utility depends on two elements: the ‘boredom effect’ (meaning the product’s novelty starts to wear off after purchase), and the ‘status effect’ (which relates to who else buys it).

The status effect packs the most punch – and this can be both positive and negative. If people you count as part of your social circle (‘reference group’) buy the brand, its appeal will increase. But if people outside that circle (‘trespassers’ or ‘social climbers’) start buying it too, the shine will quickly start to wear off. This ‘trespassing’ effect is a major cause of brand demise. As more outsiders lay claim to a brand, its status falls. Once its appeal drops, demand also dwindles.

The researchers suggest that brand extinction can be stalled by clever revitalisation and repositioning strategies, but in the long run, this is just delaying the inevitable. While it’s impossible to accurately predict exactly when and how a brand will kick the bucket, it’s only a matter of time.

For marketers, planning ahead is better than living in denial.