±±¾©Èü³µpk10

Two years ago the company experimented with a brief branding campaign in Europe, "but there was no significant benefit in terms of lead generation,

says Duignan.

Dell also invests heavily in PR, ensuring the company is represented at significant IT events and that its products are regularly reviewed in the trade press.

While some brands have recently adopted advertising, others have dropped it. Safeway hasn't used broadcast media for three years. It switched all its marketing activity below the line, and now focuses on weekly flyers promoting money-saving offers which are door-dropped to homes in the neighbourhood.

In the 18 months since it launched the flyers, Safeway has attracted one million new shoppers and has seen its share price rise from £1.70 to £3.30. "Safeway is the fourth-biggest food multiple, it has ten million shoppers a week, and it has huge saliency and prominence in the local community, so it feels it doesn't need advertising at the moment," explains Kevin Twittey, chairman of through-the-line agency Triangle, which produces Safeway's leaflets.

As marketing went to press, there was speculation that Safeway would return to TV advertising.

But Dag Bennett, senior research associate at the Centre for Research in Marketing at South Bank University, warns: "Brands tend to miss advertising when it's gone."

Some big brands, including Heineken, he says, have been tempted to stop advertising. "For six months they might not notice, but then sales fall."

Advertising is not effective on its own, he says, and should be used as a support tool rather than the core of a branding strategy. "But ads serve as reminders. You need a mix of communications, but at its best, advertising holds everything together."

The London Business School's Ritson judges some companies' decision to switch their marketing budget into DM and promotions "a legitimate trend", prompted partly by the clutter of the 90s.

The role of communications

"But the bigger revolution now is that smart companies realise marketing communications both below- and above the line is a relatively small part of the branding job,

he says. "Brand building is not about communications at all. Communications is arguably the least important aspect; everything else, including product, service and distribution, is more important."

He uses the example of premium ice cream Haagen-Dazs, launched in the UK in the early 90s. Initially it built the brand by limiting its distribution and charging a premium, making it an exclusive aspirational purchase.

It then used celebrity endorsement and PR before, finally, advertising.

As Ritson points out, Tesco has some great TV ads, but its point of difference is its staff and the quality of the service it provides. "The advertising is irrelevant in that sense, though the strapline 'every little helps is used internally to motivate staff."

Likewise, when Allan Leighton and Archie Norman revived Asda's fortunes, they relaunched the brand through changing the products and the prices, merely reinforcing the new strategy through the 'Asda price' ads.

Ritson believes firms are realising "the brand is everything

and agencies are starting to reconfigure to fight for a bigger share of the growing pie. The diminishing role of traditional advertising is, he says, "bad news for ad agencies and good news for marketing and brand consultants".

Ad agencies will become tactical executors, he predicts. "The agencies that win will be the ones that are brand-centric. We're seeing the beginnings of a battle for brands."L

Ericsson announced last week that it is laying off 17,000 staff worldwide after a 25% fall in sales in the first quarter of 2002. Both this, and a rights issue of around £2bn, are designed to help it ride out a severe industry downturn that it is expected to last into 2003.

Unlike some of its peers, it is raising money before it gets desperate, and when the downturn eventually ends, Ericsson should be strong enough to take advantage of its number-two position in mobile phones.

Aside from its Sony Ericsson joint venture, Ericsson itself has embarked on a major repositioning exercise that involves a complete rethink of its strategy and a massive staff brand-training programme. But Ericsson will not be relying on TV advertising to build this new brand.

"It doesn't mean that we have stopped our communications programme with our customers,

says Bill Gajda, director of brand and identity management for Ericsson. "We have been doing trade shows, sponsorships and conferences to reinforce our new business-to-business positioning."

So although Ericsson is building a new brand image, it won't be using traditional advertising to communicate this. "Advertising should be the icing on the cake,

says Mark Ritson, assistant professor of marketing at London Business School, who has been advising Ericsson on its brand strategy. "An ad campaign can steal the glory, and the true meaning, of a great brand relaunch."

While for the majority of brands traditional above-the-line advertising is an integral part of the marketing strategy, there are many that favour below-the-line work or no advertising at all.

Success before ads

Shared Beliefs, the IPA guide to 'what makes good and great advertising', states "a brand isn't a brand without advertising". Brands such as Pizza Express, Pret A Manger, Dyson Appliances, Dell, Next, Body Shop or Marks & Spencer would disagree. Granted, some of these brands have turned to advertising latterly, but they were built by other means.

Between November 2001 and January 2002, Pizza Express ran its first-ever advertising campaign in its 37-year history. The poster campaign featured four separate lifestyle pictures from the 60s, 70s, 80s and 90s, showing people talking, with the line 'Word of mouth since 1965' beside them.

When Pizza Express launched, it was a niche brand with a unique offering, and its reputation spread based on the quality of its product and service.

But others copied the formula, and competition grew, while Pizza Express scarcely changed its offering - last year it changed its menu for the first time in 26 years.

And proud though it was of not having to advertise, it capitulated. "We advertised because we had never advertised before and we thought we might be missing out,

says chief executive David Page. "As it happens, we probably weren't. The advertising appeared to have a neutral effect, with sales increasing at the same rate in areas where we advertised as in areas we didn't. It was an experiment that we probably won't repeat."

He adds that rather than choosing a blanket advertising approach, Pizza Express tends to gain a local following in each of their restaurants based on local initiatives such as live music.

Having tested a medium it once shunned, Pizza Express remains one of several brands that have disproved the conventional marketing wisdom that you can't launch a brand without TV advertising.

"Brands aren't a function of advertising, but of a good product experience,

says independent marketing consultant Mike Sommers, former chief marketing officer at Sequence, Royal & SunAlliance's property services. "Good advertising is like whipping a top that is already spinning."

Pret A Manger built its reputation on its excellent product and service, and used its sandwich boxes, bags, paper cups, its staff - even the shops themselves - to engage in a dialogue with customers.

Its shops are effectively three-dimensional ads in their own right. What's more, Pret's core customers work within 500 yards of the shops and typically buy lunch there three or four times a week. "We have a frequency that is greater than most FMCG companies,

points out group marketing director Morag McCay.

Last month, Pret appointed WCRS to work on a major communication project.

The agency's remit is broad, taking in positioning and branding, and may not even include advertising, says McCay.

The firm has expanded rapidly from its London base to other towns and cities throughout the UK as well as the US and Hong Kong, but she denies that Pret's evolution from a niche player requires a mass medium to reach a mass audience.

"We are a whole collection of small niches in different places,

she says. "Much mass-market advertising leads to mass-market waste because so much of it is irrelevant. We are very much an occasion- and location-driven business and that determines our strategy in terms of the priorities we give to different elements of brand building."

Pret ran some recruitment ads in 1998 that "made a statement about the brand,

says McCay, "and we may do some similarly innovative stuff again. But we certainly won't do mass TV or print advertising."

Bagless vacuum cleaner firm Dyson, which founder James Dyson launched by lugging the prototype around the streets, is open-minded.

The business ploughed what little money it had into research and development.

'The Dyson' was manifestly different from other vacuums and marketing effort went into showing its superiority over its bag rivals.

Within 23 months of the first Dyson vacuum being launched in 1993, it was the best-selling vacuum cleaner in the UK, with no advertising. Even today, 70% are bought on word-of-mouth recommendation. As with Pret, the offer's uniqueness generated PR.

Now that other manufacturers make bagless vacuums, Dyson does some advertising - though it spends only about £2m a year on TV campaigns, which are focused around product launches. Most of the company's effort continues to be directed at improving the technology.

Other advertising 'resistors' - notably Marks & Spencer and Body Shop - were forced into advertising to try to change perceptions when their founding propositions ran into trouble. They lost touch with their market and competitors stole a march.

Body Shop's guerrilla marketing - such as using its lorries as moving billboards to find missing people - was clever and counter-cultural. But Body Shop relied too long on the PR value of Anita Roddick, when much of its customer base had moved on.

"It's dangerous to condemn any form of marketing when you might need it at some stage,

says Peter Shaw, marketing director at brand consultancy Corporate Edge.

But the danger in companies turning to advertising as a distress tactic is that they use it to shore up a flagging brand without changing the underlying offer. Of course, different brands have different communications needs. Retailers such as Body Shop, M&S, Next and Bhs arguably don't need to advertise because they have a very visible presence in every high street.

Generating interest

Many internet companies, which tap into specialist areas where there is active consumer involvement, such as Friends Reunited or Amazon, have gained a huge following without traditional advertising.

"The reason FMCG firms have invested so heavily in advertising is that their products are essentially boring and they have to try to work their way up the interest ladder,

says Stef Calcraft, partner at Mother.

Likewise, financial services, which are essentially commodities, have been big spenders on above-the-line advertising. Yet First Direct, a financial services brand with no high street presence, has built a successful brand with little traditional advertising.

Instead it built its brand on efficiency and professionalism. "We model ourselves on other service companies rather than financial services firms,

says communications manager Matthew Higgins. "We do some press ads, TV and DM, but our brand is communicated by the person on the phone."

One third of First Direct's customers come via word-of-mouth recommendation, a level four or five times higher than most banks, and more than 80% of customers recommend the bank to others - twice the proportion of other banks.

But though advertising plays "a smaller role than some people think", says Higgins, it is important. "TV ads stimulate higher recommendation among our customers,

he says.

But PR, which he calls "an under-used tool", is even more important.

"We do lots of stunts and roadshows and that sort of thing, because we have to get out and be seen,

he says. "And column inches are important too - they beat a press ad any day."

Computer supplier Dell, like First Direct, sells direct to customers.

Founder Michael Dell doesn't believe in brand advertising. Stephen Duignan, Dell's consumer marketing manager, says: "If your brand is competing on shelves it has to be front of mind. The Dell brand is not, so brand awareness is not as important for us."