2008 - how do we market in a volatile market?

Jo Parker

Reading the FT’s article last week covering the views of 55 top economists it is hard to feel buoyant about 2008. Nearly nine out of the 10 believed the public finances are not in good order and that inflation is a very real risk.

Nearly two thirds said house prices would fall (not bad news for everyone then!) and that the Bank of England’s ability to affect the markets with interest rates has been significantly reduced – not least because as of today, one in five lenders fails to pass on interest rate cut to their customers.

So how should we be approaching marketing in this context going into 2008?

Well, of course we don’t know for sure how 2008 will turn out. But what all marketing plans should have in place is some clear scenario plans to show the likely affect on targets and how marketing can support the financial goals of the company. Many brands make headway in a recessionary environment. It’s when Easyjet launched. And Taco Bell and Pizza Hut stole share from McDonalds during the 90-91 recession. In 1999, PIMS conducted a study of 183 UK-based companies that compared marketing spend during recessions to share and profit gains during recovery. Those that spent in recession did better afterward than those that did not.

But how many of us are building this into our marketing plans right now or just burying our heads in the sand and carrying on as if nothing was happening?