The first half of 2001 has been marked by mass layoffs, plummeting stock prices and the continuing high-tech meltdown. The economy, sustained by consumer spending, is showing its weakest growth in eight years. And still, senior managers are charged with driving up shareholder value and profits. So how do they accomplish that? It’s difficult to increase sales or raise prices during economic down times. So the inevitable happens: they are forced to reduce costs and cut what is referred to as “discretionary spending.” How each manager defines discretionary spending differs and says a lot about how they prioritize those components that drive customer value (marketing and advertising are usually the first to get the ax). But, if a manager considers their brand to be a strategic weapon or asset that creates a sustainable competitive advantage, they will not subject their brand to cuts. Instead, they will nurture their brand and find ways to continue to make it relevant, even during down times. Keep in mind that sustaining your brand is not synonymous with high levels of advertising. Sustaining your brand simply means that you keep your brand message visible so that you maintain brand expectations. Your focus is now on maintaining versus growing.

Brand loyal customers expect certain things from your brand. To cut those things that contribute to the delivery of your brand could lead to losing customers. During economic slowdowns, customers may prioritize more and differently, allowing fear and uncertainty to affect their decisions. But they still make purchases, and they continue responding to brands they consider relevant, whose core value propositions resonate and which are flexible enough to accommodate any changes or disturbances to their psyches. So while they do their part, brand managers have got to continue doing theirs and stay committed to their brand.

Brand commitment requires a philosophical commitment to putting the customer, his/her evolving needs, connection to the company and reason for believing in what the brand stands for at the center of all company actions and culture. You still can’t ignore the economy and its plight. But you can convey a message, within the core foundation of your brand, that empathizes with your customers during this difficult time. Smart companies will use the slowdown to reassess and shore up their brands in line with changing customer needs, and use it as their guide to ensure everything they do with their limited resources is focused and relevant.

Remember, the economic downturn will eventually cycle its way back up and those same consumers that trusted you before the downturn will be the same consumers you will count on to grow your business. Don’t lose them at a time when you need each other the most.

Kilmer Kilmer Marshall Duran is a strong advocate of the power of branding. To learn more, please call us at 505.260.1175 or 800.260.1165. Our e-mail is kilmer@k2md.net.

© 2001 Kilmer Kilmer Marshall Duran, Inc.