The economic crisis silver lining

With 2008 bowing out on a season of unremitting business gloom, the New Year bringing with it the prospect of a deep recession is a daunting one for some. But not the UK marketing community. When Marketing Week asked industry figures for their thoughts about surviving and thriving through a downturn, the overwhelming message was: Don’t panic!

Feature%202With 2008 bowing out on a season of unremitting business gloom, the New Year – bringing with it the prospect of a deep recession – is a daunting one for some. But not the UK marketing community. When Marketing Week asked industry figures for their thoughts about surviving and thriving through a downturn, the overwhelming message was: Don’t panic!

Most see a recession as a time of great opportunity that will favour the brave and many believe the coming year will see the survival of the fittest. News Corporation chairman and chief executive, Europe and Asia, James Murdoch advises marketers to shape up, literally. “Stay fit,” he says. “It keeps energy high and the mind clear.”

Murdoch reflects: “There will be a lot of pain in 2009, both for consumers and the companies that serve them. For marketers, the key thing to ask yourself is whether you’ll just focus on survival, or if you’ll be among a small number of businesses that see pain as a catalyst for transformation. It’s worth remembering Lance Armstong’s words that ‘pain is temporary, but quitting is forever’.”

Murdoch encourages marketers to “get out from under the desk”. He advises: “It’s an opportunity, unlike any we’ve seen, to challenge and change things. Now is the time to press any advantage.”

He is not alone in seeing a chink of light through the dark skies. Aviva chief marketing officer Amanda McKenzie tells those working through their first recession: “If you love learning, enjoy every moment.” Brands will be sustained by applying “a relentless focus on customers”, she says. 

Procter & Gamble corporate marketing director and head of marketing UK and Ireland Roisin Donnelly agrees: ‘There has never been a more critical time for putting consumers at the heart of everything you do. Keep innovating and responding to their needs.” Donnelly advises: “See the recession as an opportunity to reinvent your brand, your company and even yourself.”

A willingness to change and the ability to respond quickly to consumer needs will be key in 2009, according to our respondents. GlaxoSmithKline general manager of consumer healthcare UK James Hallett advises marketers to be “flexible and prepared to change what is not working quickly” and adds another important tip: “Don’t lose your sense of humour.”

For younger marketers who lack experience in sustaining a brand through uncertain times, Hallett – who has seen off previous recessions – says reassuringly: “Markets don’t disappear and nor do brands. Brands can thrive and most of the strong brands that exist today were around before 1990.” They should not feel downhearted, he insists: “Hard as it may be to believe, it’s a great experience managing in tough times.”

While the impact of the credit crunch on the retail sector might indicate radical action is needed by some brands, Waitrose managing director Mark Price urges caution. “You have to stick to your mission. If you’ve spent 100 years building a brand, as we have, you can’t jettison it overnight and become something you’re not.”

A veteran of two recessions, Price is philosophical: “Sometimes the dice will roll in your favour and sometimes they won’t.”

With consumers tightening their belts throughout 2009, many predict value will be a key theme for the year. Andy Brent, BSkyB marketing director and former director of the Government’s £75m anti-obesity drive, says consumers will be looking for value for money and advises marketers to “focus on understanding their consumer and what they want, as never before”. He adds: “The answer may not always be lower prices, but if it is you’d better give it to them.”

Brent points to the positives that can emerge during tough times: “The great brands and the great marketing organisations will grow stronger,” he says. “The trust people have in great brands is especially valuable.”

Yet trust is not everything. Many point out this recession differs from previous ones in that consumers have instant access to comparison sites where they can seek the best deals. London 2012 commercial director Chris Townsend says: “There is significantly greater choice and competition in 2009, underpinned by decreasing brand loyalty and greater consumer willingness to trial new brands, products and services.” And while marketers should apply themselves to sustaining their brands through the downturn, Townsend reminds them: “Plan well for growth opportunities that will be available at the end of the recession and maximise the upswing.”

There are other reasons for optimism. Some believe that while the increasing fragmentation of media is an issue, it is also an opportunity. Coca-Cola Great Britain marketing director Cathryn Sleight foresees precision marketing offering “a substantial opportunity in today’s climate”.

Sleight says companies will need to work even better with their retail partners to build a closer relationship with shoppers and believes fully-integrated campaigns will enable this. At rival PepsiCo, Pepsi marketing director Bruno Gruwez considers offering “the right promotions and incentives” a key factor for 2009.

Media companies will need to offer effectiveness and value for money to get their share of diminishing spend, according to Radio Advertising Bureau chief executive Andrew Harrison. “Media owners that can offer bespoke research to advertisers, which demonstrates effectiveness, and have inventory at competitive pricing should build share,” he says. 

While demonstrating return on media investment will become increasingly important, some warn against getting obsessed with accountability. Tess Alps, chief executive of TV marketing body Thinkbox, says: “Marketers must treasure holistic effectiveness evaluation over easy ‘countability’ and risk ruffling a few feathers of their direct and online specialists.”

The consensus is that meeting the varied challenges presented by what many experts predict will be a deep and long recession will result in a leaner, fitter and maybe a more exciting marketing industry. Jim Prior, managing partner of branding agency The Partners, suggests: “We can look forward to more creative, inspiring marketing. No one is going to invest in mediocrity.”

And Abbott Mead Vickers.BBDO chairman Cilla Snowball has faith that this cloud has a silver lining for the marketing industry. She says: “Things will get better. And when they do, we’ll emerge stronger.” 

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