After a year of budget cuts, hard stops on advertising, and country-wide shut downs that cancelled in-store and event activations, many brands are now ready to get back to spending on what they feel will best impact their bottom line.
In the United States, food and beverage brands as well as other consumable goods are chomping at the bit to reconnect with customers, scooping up every activation opportunity presented to them as quickly as possible. However, a recent Nielsen report warns that without a well planned long-term strategy, as well as a focus on building real consumer brand awareness, short-term ad plays like activations hold little value, and may actually do lasting harm to brands.
During this market recovery, it is more critical than ever for brands to balance all components necessary to support sales, and in particular, to wisely invest in developing a complete brand awareness strategy.
AN INVESTMENT IN BRAND AWARENESS
If a brand completely stops marketing and advertising, as many did during the pandemic, this typically doesn’t result in brand awareness dropping to zero. It is brand decay, or the loss of relevancy or identity, that can be problematic when brands go dark for extended periods of time. This is why many brands maintain consistent advertising and marketing campaigns even during normal market conditions.
Nielsen pointed out that, on average, it can take at least three to five years for a brand to recover lost equity as a result of halted advertising. The report also noted that ‘long-term revenue can take a 2% hit for every quarter a brand stops advertising’.
Nielsen also stated that the long term effect of marketing is 88% greater than its effect on short term impact. This means brands have to play the long game of brand impact and awareness if they want to stay ahead of their competition.
WAYS TO MAINTAIN YOUR BRAND AWARENESS
Given the tumultuous state of the globe this past year, it is not surprising to see brands attempting to focus efforts on what they consider sure bets: Live event placements, paid celebrity endorsements, activations like direct to consumer discounts, sponsorships, direct mail promotions were all part of their usual strategy to stay top of mind with consumers.
Activation-oriented tactics such as these can temporarily raise awareness in specific markets; however they tend to provide more effective results when combined with organic brand awareness efforts.
Ongoing, consistent social media efforts combined with supportive public relations is the best combination for not only getting in front of, but staying on your ideal customers minds.
Forecast data also shows a near parallel connection between sustained consumer interest and sales, inferring that a 10% increase in interest can lead to a 10% increase in sales.
A FOCUSED STRATEGY TO REACH CUSTOMERS NOW
Understanding the mindset of consumers today is also a critical factor. Racial disparity, along with a strong increase in the desire for equality and support for small, woman and minority owned businesses has impacted consumers of all financial backgrounds and incomes.
Awareness of these issues, as well as other social movements, have given consumers more reasons to seek out and choose to support different brands from those they might have typically purchased. A return to activation-geared marketing that does not take the impact of these factors into consideration could result in a consumer being turned off by a brand as being out of touch or insensitive.
It’s also important that brands speak authentically about topics that connect to their core values and mission, so as not to appear to be ‘washing’ advertising messages with the sole purpose of driving sales.
Nielsen noted that 41% of consumers are more likely to buy from a brand that uses brand messaging and advertising to show how they are giving back or helping others, both with employees, as well as customers and within the community.
UNDERSTANDING TODAY’S BUYER
Consumer buying patterns have also changed. Direct to consumer messaging, as well as storytelling that clearly communicates how a brand solves a problem or has a purpose that fits into customers’ lives will likely impact a brand’s bottom line much more effectively than short term advertising or endorsements alone.
American consumers have been statistically proven to be ad-blind, and with the rise in online purchasing, curbside pickup, and contactless retail experiences, brand choices and purchasing decisions are being made well before a customer ever begins to add items to their shopping list.
If a brand wants to be top of mind and get into the cart, they must engage with customers early and often, in ways that add value and meaning for them personally.
The opportunity may also be greater than you think. Although a short-term activation might be alluring, Nielsen reported that on average, a single ‘1-point gain in brand metrics such as awareness and consideration drives a 1% increase in sales’. One percent might not seem like much, but consider that a 1% return on $500 million in sales equates to $5 million in increased revenue.
HOW TO BALANCE WITH MARKETING AND ADVERTISING
Given the ever-evolving state of media and advertising, brands need to focus on balance if they want to thrive. This means integrating long-term planning for brand building and raising awareness, along with sales-driving initiatives. Earned media and content strategies, as well as thoughtfully planned advertising that supports both awareness and sales in the market are key.
Additionally, long term business success involves more than just repeat business from retaining current customers. It also involves continuing to attract and gain new customers through ongoing brand affinity initiatives.
In the past, visibility on a store shelf, live tastings, and through POS worked well. Today, with more customers making their buying decisions before visiting the stores, if even going in at all, in-store marketing programs are now much less reliable.
In contrast, brands that use digital marketing to stay top-of-mind with consumers will come out as winners. It is important for brands to set direct metrics for performance, and have clear KPIs that are easy to measure. Determining an increase in brand awareness comes from many factors. These including brand recall, consideration within a category, as well as share of voice. Integrating advanced technologies can enable brands to connect online and offline consumer interactions, maximizing impact on a brand’s bottom line.
A TOTAL SOLUTION FOR SUCCESS
In today’s modern marketplace: sales, marketing, earned media, advertising, and brand awareness should not compete. These aspects of a brand should instead work together in unison as the complete recipe for success.
Brand owners and managers should take time now to analyze their current marketing and advertising budgeting initiatives and align where their strengths and weaknesses lie. By focusing efforts on a target audience, your brand should be able to create a proper balance of the available tools at your disposal in order to not only compete, but thrive in this post-COVID economy.