The BV Blog

Seems we can’t get through the day lately without hearing all about how the American economy is goin’ to hell in a hand basket. I’m certainly no economist so I can’t address whether it is or not, but in light of the current headlines I thought it important to reiterate a simple truth: when business slows down, it’s not a good idea to cut activity that drives sales - like marketing.

As support, I offer this excerpt from Jay Lipe’s “10 Commandments of Marketing.” 

“Thou Shalt Not Cut Marketing Spending During Slow Times

From 1980 to 1985, McGraw-Hill Research analyzed 600 companies and their marketing spending. After 1985, McGraw-Hill concluded that those firms which had maintained or increased their advertising during the recession in ’81-’82 boasted an average sales growth of 275% over the next five years. But those companies who cut their advertising saw paltry sales growth over the next five years of just 19%. When is the right time to market your business? All the time.”

And here’s a piece from Advertising Age on how Kraft and Kellog’s are responding to lower 4th quarter earnings.

In 2007, we thought we’d seen it all.  Skyrocketing oil prices, toys with lead-based paint, the Western wildfires, senators in bathroom stalls, and of course Sanjaya.  And just when you thought things couldn’t get any worse, there they were:  Precious Moments coffins. 

According to the TippingSprung Brand Extension Survey, deeming the best and worst brand extensions for the second year in a row, the heart-warming keepsake-maker was one of the numerous brands that just “didn’t know where to draw the line—when it came to line extensions.” 

In a poll of 785 Brandweek readers, the coffin was voted the most inappropriate extension followed closely by the Humane Society Dog Lovers Wine Club, and Girls Gone Wild apparel.

Since the “New Coke” debacle of the 80s, marketers have become more cautious with product extensions.  But brand extensions?  As time marches on, it seems all sense has gone out the door.  Usually new developments are used to increase add-on sales to an already powerful portfolio.  But too often, these new endeavors result in a straying from the core values of the brand, along with the associations consumers have tied to it. 

It’s been proven—one mistake and a company can dilute or even severely damage the brand they have spent years building.  When you raise eyebrows, you raise doubts. 

Brands that did it right, however, proved that you can capitalize on the core values that make you strong, but still can differentiate in a positive way.  PetSmart PetsHotel was voted best brand extension overall; Curves Cereal finished a strong first in the food extension category; and The Food Network was tops with its kitchenware line.  Innovative, successful—these brands know how to play their hand.

And as America’s preoccupation with celebrities continues to climb, it seems that a classic will still win over the audience.  Newman’s Own released a new wine line that was to the liking of 75% of the respondents.  On the other hand, The Jeff Gordon Collection of Fine Wines bombed, with an over 90% disapproval rate.  I’m not going to touch that one.

It seems that certain companies may need a call back to the basics; a reminder to “Keep It Simple Stupid.”  When designing a brand hierarchy, think commonality.  Think relevance.  And above all, think simplicity.  And if none of that helps, think about what your brand would look like in a Precious Moments coffin.