Whatever 2003 brings, we can be certain only of uncertainty. After two years of collapsing confidence and business caution, this could now be a time of opportunity, but in a Europe faced with the threat of war and the danger of the same collapsing confidence and caution from consumers, any plan for 2003 must seem fraught with danger.
If the international and economic contexts are uncertain, the practice of marketing itself is on the cusp. The accepted wisdom and traditional media are questioned as never before.
Forecasts for a rebound in media advertising lack conviction. In most markets, television has been the medium hit hardest by declines in advertising budgets and softening of rate cards. The emergence of new cable and satellite channels has hurt the audience shares of the leading broadcasters and reduced their bargaining power.
Worse, numerous studies and advertisers are calling into question the raison d'etre of television as the dominant medium of communication. Print publications, with pressure on readership and revenue, have fared little better.
The conventional wisdom is that in a downturn, expenditure will shift to communication that is both targeted and measurable, generating a demonstrably higher return on investment. It should be the time of direct marketing.
The statistics lend some support for this case. The discipline of direct marketing has certainly boomed in the UK. But there has been little evidence of acceleration in any other market, and the trends are evolutionary rather than revolutionary.
Many observers still expect a return to an emphasis on broadcast and print once confidence returns. One even senses many businesses seeking comfort in a return to traditional media and to tried and trusted marketing methods.
Amid the blizzard of forecasts, there is general acceptance that interactive or online marketing is once again set to grow. But the growth rates are of an order less than those of the heady days of 1998-2000, and from a very low base. And there is no demonstrable business model: the banner is limiting, and the pop-up interstitial rejected. Interactive marketing remains outside the mainstream.
The least certain factor in 2003 is the behaviour of the consumers who are the market. Will so far bullish British consumers continue to trust in rising property values and Gordon Brown? Will depressed German consumers emerge from their winter of discontent with Chancellor Schroeder? There is little that governments can do, especially in the Eurozone. So what can marketers do?
The year 2003 will be one in which we have to live dangerously, because nobody will be able to tell what lies round the corner. Here are three resolutions -- make them real for your business, to mine the immediate opportunities while minimising the undoubted risks.
1. Understand how much you can grow your sales (and build your brand relationships) with existing customers:
The insight that it is easier to sell more to existing customers than to acquire new customers has become marketing speak without becoming marketing practice.
Run a pilot marketing program (i) to seek customer feedback as to their satisfaction with your services and potential needs for more; (ii) to test new propositions and offers to increase your share of wallet; (iii) to learn how you can add more value to the experience your brand delivers in the future.
This is not research, but a live marketing pilot. It can be executed at low cost and fast turnaround. The results can focus marketing in the second half of 2003, when either confidence will return or a double-dip recession will require you to cut budgets but maintain sales.
2. Develop a plan for using digital channels to create new connections with consumers:
The internet and the developing broadband digital channels create two new forms of opportunity. The first is to deliver lower cost, faster response and more deeply branded consumer experiences. The second is to leverage the community or viral potential of these channels to motivate your existing customers attract a growing franchise.
And don't just plan for digital channels in isolation. Look at how all of your other touch points with customers could integrate them. From how the internet could replace or support steps in the sales cycle, to how information could be made available for consumers to access rather than the more expensive and intrusive push marketing methods of print and mail.
Digital channels can make catalogues and literature more efficient and productive. They can support and combine with live events to reach wider audiences. Switching some budget to digital can significantly increase return on investment.
3. Build a real-time feedback loop connecting your top decision-makers to your consumers:
Whatever happens in the market, your business will have to learn to turn on a sixpence, to change direction instantaneously, to respond to changing behaviour, whether from consumers or competition. Responsiveness will be the critical success factor.
Execute real-time monitoring of consumer response, and develop the management systems to make this accessible and relevant to every senior manager in your company. You become the voice of the consumer and, therefore, the one who more than anyone else can 'call' the dangerous market of 2003.
Getting closer to your existing customers enables you, at worst, to maintain sales with lower budgets -- the learning can also lead towards a deeper brand value proposition for the future. Switching investment to digital channels can turbo chargerelationships and sales among key customer segments -- including those most valuable for the future. Building a feedback loop from customers to decision-makers can increase your responsiveness to change -- and create a new strategic role for yourself and marketing in your company.
Together these three resolutions add up to a new approach -- to navigate the dangerous waters of 2003 with a new consumer compass.
Stewart Pearson is CEO Europe, Middle East and Africa for Wunderman, a Y&R Group company and member of WPP Group.
Please write with feedback and opinion to Stewart Pearson.