The received wisdom is that brands can spend themselves out of a crisis. The brands that keep investing in a downturn come out of it faster and stronger. However, most CFOs will understandably not be very susceptible to this argument right now. So what can brands do instead? Act on your purpose, when you can’t advertise. The brands that act will become meaningful and memorable; they can become hero brands.
Sir Martin Sorrell says that “those arguing brands should spend their way through a recession are talking nonsense this time”. He expects marketing services to take a hit in the short term. (Campaign, April 2, 2020). He sees budget cuts and a shift to digital. The one exception? “Socially beneficial or purpose-driven programmes”. This might seem counter-intuitive, but when you consider the economic value of brand purpose it really isn’t.
It pays to act on your purpose
Brands represent 20% of a company’s value. From the Meaningful Brands research done by Havas Media, it has become clear that 30% of brand strength is defined by a brand’s societal contribution. In the current crisis, we can expect this to become even more important. The latest Edelman Trust Barometer shows that people are expecting brands to contribute in the time to come. 65% expect that how brands respond to the corona crisis will impact their purchase behaviour in the near future. 37% say they have already started using a new brand because of the positive way it has responded. If you think of a brand’s societal contribution as a Category Entry Point, one that is becoming increasingly important, then now is the time to act on it.