The latest company to consider recession-inspired messaging is General Motors, which announced last week it may use empathetic strategies to entice cautious car buyers. The beleaguered car maker is taking a cue from competitor Hyundai’s latest campaign.
GM has studied Hyundai’s effort “extensively” and is exploring something the company believes will be more consumer-friendly, said Mark Leneve, GM North America VP of sales, service and marketing, in a March 3 conference call with reporters.
Hyundai Motor America’s recession-related Assurance program, announced in January, allows consumers to return any new Hyundai leased or financed in 2009 if the owner unexpectedly loses his/her income within the first year.
The Hyundai program expanded at the end of February to give customers a one-time, 90-day payment relief in the event of job loss or physical disability. The tagline assures consumers “We are all in this together, and we’ll get through this together.”
“We believe that brands grow stronger in uncertain times when they actively respond to consumer needs. Assurance signals that Hyundai understands the challenges that consumers are facing today,” Chris Hosford, VP, corporate communications, Hyundai Motor America, told DMNews via e-mail. “This is an emotional issue as well as an economic issue, and we think it is important to communicate that as a company we understand the difficulties and want to do what we can to assist people in these difficult times.”
GM’s approach is still evolving. “We’re not crazy about the Hyundai program because all it really does is keep your credit from getting wrecked,” Leneve said. “You lose your job, you’ve got to turn your car in. If you lose your job, you need your car, right? How are you going to get a new job?
“So, we’re trying to figure out maybe a more consumer-friendly program,” he said. “And we haven’t quite landed on it yet. But we think it’s a rich area to explore in this kind of overall economic environment.”
The auto industry players are just one group that is adapting its customer outreach strategies due to the sluggish economic growth that is expected to last well into the year. Other industries have seized on emotional messaging as well.
JetBlue Airways is letting people who lose their jobs off the hook for any travel plans by offering refunds on typically nonrefundable fares. The effort is an attempt to build confidence in consumers to still book travel, even if they are concerned about being laid off.
Dean Foods, which has numerous dairy brands countrywide, took the unprecedented step of launching a national promotion in January that included a partnership with Kraft Foods, a strong digital presence and shopper marketing.
“This is the first time Dean Foods has done a national program across all of its brands,” said Rodney Mason, CMO at digital and promotion agency Moosylvania. The decision was “driven by the economy requiring more efficiencies” and the need to bring more value to its marketing.
“Adding real and tangible value for the consumer above and beyond the purchase and discounting of a product,” is essential during these times, said Mason.
With consumer spend slowing, some clients may question the effectiveness of investing to launch new campaigns
“Clients are in panic mode, and they are searching for answers,” said Marc Fleishhacker, managing director of Ogilvy’s North American consulting business, who is leading Ogilvy’s new recession marketing practice, which brings together more than 100 experts in marketing strategy, analytics, measurement, e-mail, technology and media.
Ogilvy’s practice will help marketers figure out how to cut their budgets by 40% and still maintain a profit or what to do when they have large numbers of long-term loyal customers who have suddenly stopped spending. Ogilvy came up with a set of 21 solutions that can be implemented in four to six weeks, and each comes with its cost spelled out.
“We wanted to make it very easy for our clients to identify a problem, see a solution, identify the cost and act on it,” Fleishhacker said. Making this happen required some re-organization within Ogilvy, he added.
The recession practice has already been engaged by existing Ogilvy clients British Airways and Six Flags.
“In some cases, we’re changing the messaging, but it presents a challenge if you go to completely value-priced messaging,” said Fleishhacker. This is because differentiation in a down economy becomes increasingly difficult when your only message is built around pricing.
The better way is with “empathetic messaging” that shows the marketer understands the plight of the consumer, he said.
The Folsom Project, a new marketing consultancy, whose clients include IBM, also wants marketers to realize that it’s going to be hard to compete on price in this market.
“You can only go so low or you will eventually go out of business, so you have to give consumers another reason to come [to your Web site or store],” said Robert Wolfe, one of the founders of The Folsom Project.
Success in today’s marketplace is all about being notable and creating loyalty, Wolfe said. “If a marketer is going to send a message to a customer, where it’s a text message, e-mail or whatever, it’s got to be so good that the recipient is going to forward it to a friend.”