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Christmas parties to protect the bottom line. And well it might. If it comes, this is will not be the recession of 1991, when agency white papers encouraged advertisers to "stay the course." Wall Street, they reasoned, would accept lower profits if there were a sensible long-term strategy in place. That's naive. Today's stock markets take no prisoners. So when sales soften, costs must be cut and unfortunately advertising is one of the least painful cuts for a brand to make. The New York Times reports major agencies have fired 2,000 employees since December. One wonders what would have happened if those agencies had large ad budgets to cancel instead?
ERWIN EPHRON
WWW.EPHRONONMEDIA.COM
ERWIN EPHRON
WWW.EPHRONONMEDIA.COM
are far more responsive. For example, DTC, finance, Wireless, Retail, Movies. Here advertising often pays in the short-term. Agencies need to makes the case for advertising by looking where response is strongest, not just where the data are familiar.
ERWIN EPHRON
WWW.EPHRONONMEDIA.COM
lower pricing periods (TV) and taking advantage of the brand's seasonal purchase patterns. It also may make sense to move some national dollars into spot areas (higher purchase, higher share, higher growth), where advertising is more likely to produce an immediate effect. But probably the most important recommendation is to reduce weekly weight instead of cutting weeks of advertising. Better information on the short-term effects of advertising effects is necessary and should soon be available. Many agencies and research firms are working on the problem. But until then we'd better pray for a quick cure. The idea of spending scarce dollars now to increase profits tomorrow is tough to sell during a recession. - February 26, 2001 Originally published in Advertising Age
ERWIN EPHRON