Some Clients Gamble on Growth


The conventional wisdom in marketing circles is that during a recession, the best thing you can do for your brand is to increase your advertising spend. So who has actually done that?

According to major media spending data from The Nielsen Co., marketers in categories such as fast food, telecom, insurance, lending and cable/satellite TV spent more on advertising in the first eight months of 2009 then they did in the same period in 2008. This is due, in part, to the seizing of opportunities created by the recession, including cheaper ad rates and consumers hungry for bargains, said marketers and media buyers.

Adweek parent Nielsen estimates that total media spending, excluding online, declined 12 percent to $66.1 billion for the period. The overall pullback in spending in the U.S. has created a softer ad market, particularly in TV, which enables brands that loosen their purse strings to stand out.

Other reasons include brand relaunches, new product introductions and advertising behind an acquisition. Bank of America, for example, spent more than $21 million through August -- up from $88,000 in the like period last year -- to relaunch its home mortgage business following its acquisition of Countrywide Financial. “It was important for make sure that we were generating the awareness and building the equity around responsible lending and successful home ownership,” said Ray Chinn, head of home loans and insurance marketing at the bank.

Many companies clearly have been opportunistic by upping spending in a downturn, as consumer habits change in the face of high unemployment, lower wages and declining real-estate values. “The media/economic environment has allowed us to get more bang for our media buck,” said Tim McIntyre, vp of communications at Domino’s Pizza, whose major media spending jumped 31 percent in the first eight months of ‘09 to more than $111 million, according to Nielsen.

Other players in the fast-food realm, including McDonald’s, Subway, Burger King, Papa John’s, Popeye’s and El Pollo Loco also increased their outlays in that period.  McDonald’s spending climbed 6 percent to $575 million and Burger King’s 3 percent to $173 million, per Nielsen.

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