Recession Insurance: How Much
Would You Pay?
By Timothy R. Hawthorne
Whether our economy is technically in recession is moot. Consumers are behaving with
recessionary caution — tightening their
belts and polling with gloom. Four-dollar-per-gallon gas keeps casual shoppers on their couches
with front-row views of their declining home values.
Companies are in a funk too. Forrester claims that
more than three-quarters of global marketing executives
expect their ad budgets to stagnate or shrink by around 3
percent. So why is it that, from my desk, I see silver linings in darkening skies?
The answer is simple: direct response television.
DRTV is structurally
well-suited to thrive during difficult times. Media
billings prove it. During
the two notable recessions
our nation has suffered
during the past 20 years,
DRTV billings were robust. The Direct Marketing Association (DMA)
claims DRTV grew
roughly 10 percent during
the early-90s recession,
and long-form billings rose
six consecutive quarters
during this decade’s dot-com bust.
Even as trade publications project ad budget cutbacks, Response keeps
reporting record DRTV billings. Should direct response
marketers draw confidence from history’s tendency to
repeat itself? Of course. But there are very good reasons
for optimism:
The Killer Deal. When times get tight, consumers
start comparison shopping.
They track down the best
deals, clip coupons and wait
for discounted offers. With of-
fers prominently repeated dur-
ing each call to action, DRTV
always speaks the language
nervous buyers want to hear.
Free premiums and discounts are popular any time;
in a troubled economy, they’re compelling.
Bargain Media. It’s not just consumers who love
finding deals — advertisers welcome them also. For
the cost of 30 seconds in prime time, DRTV marketers can fund dozens of airings across a broad range of
stations. More reassuring, DRTV media buyers actually encourage ad planners to scale back, by axing
any media that doesn’t perform.
Solving Problems Is a Household Necessity.
People’s first response to recessions is to sacrifice
luxuries in favor of items perceived as necessities.
At the grocer, this means
replacing filet mignon
and asparagus tips with
peanut butter and pasta.
For lifestyle decisions,
it means eating out less
to fill up the gas tank.
General advertising suf-
fers in recessionary times
because it’s tough to
position wine coolers as
staples. You might miss
them, but you don’t need
them. DRTV, of course,
routinely positions
products as solutions to
everyday problems. For
consumers that face these
dramatized troubles, the products that solve them
become necessities.
Tough times are the best times to win over converts.
Given skyrocketing gas prices, DRTV agencies should
be all over carmakers to devote some half-hours to extolling the cost benefits of fuel-efficient vehicles. Big-box
wholesalers could enjoy a similarly striking impact by illustrating the breadth of their merchandise and the depth
of their “stores full of savings” — at precisely the moment
their targets need price breaks.
Successful companies always insure themselves against
possible damages that untold contingencies cause. For
predictable and cyclical recessions, the best policy may be
simple: tried-and-true DRTV.
