Mark A Cella on Depression Advertising

In an article dated 4-17-09 called ‚Burger King to Boost Ad Spending‘ distributed on the AdAge website, authored by Emily Bronson York, cites Marketing Director, Russ Klein, who acknowledges the strategy of the company to fiercely boost ad budgets amidst financial hard times.

Clearly seeing favorable good fortune during recession:

„…there is strong historical evidence around companies that step up with their innovation and advertising and their ability to move through economic downturns and they emerge with stronger brands on the other end.“

Mark A Cella on Economic Recession Advertising

New Yorker Magazine’s James Surowiecki’s article dated, April 20, 2009, for the financial page. He suggests in his article that several studies prove that businesses that continually invest in marketing and research and development while amidst recession do enormously better than companies that decrease spending in those areas.

Mark A Cella on Recession Advertising

In 1927, economist Roland Vaile ascertained in his studies that „firms that kept ad spending stable or increased it during the recession of 1921-22 saw their sales hold up significantly better than those which didn’t.“ Not to mention:

„A study of advertising during the 1981-82 recession found that sales at firms that increased advertising or held steady grew precipitously during the next three years, compared with only slight increases at firms that slashed their budgets. And a McKinsey study of the 1990-91 recession found that companies that remained market leaders or became serious challengers during the downturn had increased their acquisition, R. & D. and ad budgets, while companies at the bottom of the pile had reduced them.“

Strategic Planning Institute concluded through their own research that businesses whom cut investment during recessions grew at a smaller pace in the years after the hard economic climates ended.

Mark A Cella on Depression Advertising

Kraft brought out Miracle Whip in the great depression and it became the #1 dressing across the USA in only 6 months. The transistor radio was launched in the 1954 deflationary period by TI, and Apple launched its iPod in the 2001 recession.

Perhaps the most compelling example of successful recession opportunity is illustrated with Kellogg’s profound success during the Great Depression. Surowiecki relates that:

„While Post Cereals…cut back on advertising (during this period,) Kellogg doubled its ad budget and by 1933, even as the economy cratered, Kellogg’s profits had risen almost thirty percent and it…became…and remains the industry’s dominant player.“

History proves repeatedly businesses that increase market budgets benefit tremendously during and after recessions.

In the most trying of economic times, those that are able to rise to the challenge by capitalizing on the opportunities presented can prevail in this game of survival of the fittest.

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