Y&R THOUGHT LEADERSHIP

CALAMITY:
MARKETING YOUR WAY
OUT OF THIS RECESSION

2 Source: Conde Naste Portfolio, January 2009 Copyright John Gerzema/Young & Rubicam
 Source: Michael Probst / AP
3
 RESULTS 1–10 OF ABOUT
22,200,000 FOR RECESSION
AND MARKETING

3 Copyright John Gerzema/Young & Rubicam

 FUNDAMENTAL SOCIETAL
SHIFT
FROM A CREDIT TO A CONFIDENCE CRISIS

SEA CHANGES IN CONSUMER BEHAVIORS

COMPANIES MUST CHANGE HOW THEY

CONNECT WITH CONSUMERS
4 Copyright John Gerzema/Young & Rubicam
MANAGING FOR AN UPTURN

SUPERIOR CASH FLOW AND

SUSTAINABLE GROWTH
ALIGN BRAND AND BUSINESS
STRATEGY
ACQUIRE TALENT AND QUALITY
DO MORE WITH LESS
SHARPEN MESSAGING AND ROI
RETURN TO YOUR CORE
FACE YOUR CUSTOMER

5 Source: Y&R Strategy, HBR: Anthony T Jan, John Quelch Copyright John Gerzema/Young & Rubicam
HALF OF ALL GLOBAL WEALTH
HAS EVAPORATED

$36 TRILLION DOLLAR LOSS

WORLDWIDE
S&P 500 DECLINED 64.4% FROM 2000
45% OF AMERICAN WEALTH FROM LOSS
OF EQUITY AND HOUSING VALUES
AVERAGE RECESSION IS 6-12 MONTHS.
THIS IS A MARATHON

6 Source: Bloomberg, Iconoculture March 2009 Copyright John Gerzema/Young & Rubicam
THE NEW FEAR ECONOMY

UNEMPLOYMENT NATIONAL DEBT

HOUSING VALUES DETROIT

EQUITY MARKETS CURRENCY VALUATION ?

INTEREST RATES ? PROTECTIONISM ?

COMMODITY PRICES BANK LENDING

IN(STAG)FLATION ? FACTORY & HOUSING STARTS

BAILOUT ? CREDIT CARD EXPOSURE

}
CONSUMER CONFIDENCE

7 Copyright John Gerzema/Young & Rubicam

 CONSUMER CONFIDENCE:
LOWEST SINCE 1967 (INCEPTION)
EXCLUDING 2003 / IRAQ WAR PERIOD

8 Source: ABC News

THE LARGEST U.S. BUDGET
DEFICIT POST WWII

9 Source: Board of Governors of the Federal Reserve System Copyright John Gerzema/Young & Rubicam
 VISUALIZING THE BAILOUT

10 Source: The Atlantic Copyright John Gerzema/Young & Rubicam

FRACTURED FAITH IN
THE AMERICAN DREAM

11
12
 HOUSING VALUES CONTINUE TO
DECLINE ACROSS THE U.S.

12 Source: “Irrational Exuberance”, 2nd edition, 2006, by Robert J. Schiller Copyright John Gerzema/Young & Rubicam
 AMERICAN’S HOMES NO LONGER
PERSONAL LINES OF CREDIT

13 Source:Us Department of Housing and Labor, 2009 Copyright John Gerzema/Young & Rubicam
 WHILE THE CREDIT CRISIS HAS
HALTED HOUSING STARTS

14 Source: www.calculatedriskblog.com Copyright John Gerzema/Young & Rubicam

INTO THE GREAT WIDE OPEN

UNEMPLOYMENT 8.5%; HIGHEST IN

TWENTY-FIVE YEARS
FOURTH STRAIGHT MONTH OF
600,000 JOBS LOST

15 Copyright John Gerzema/Young & Rubicam

 THIS PERIOD MARKED BY MOST JOB
LOSSES, WEAKEST RECOVERY

16 Source: Change in Nonfarm Pay rolls, Reported Monthly, Bureau of Labor Statistics, U.S Dept of Labor Copyright John Gerzema/Young & Rubicam
DEALING WITH THE STRESS
OF THE CURRENT ECONOMY

3 Source: Comscore Copyright John Gerzema/Young & Rubicam

AN EQUAL OPPORTUNITY
RECESSION

MILLIONAIRES HAVE LOST ONE-

THIRD OF THEIR NET WORTH.

17 Copyright John Gerzema/Young & Rubicam

 AFFLUENT MORTGAGE
RATE DEFAULTS

18 Source: LPS Applied Analytics Copyright John Gerzema/Young & Rubicam

DRAMATIC INCREASE IN
FINANCIAL AND ECONOMIC
RELATED SEARCHES

1 Source: Comscore Copyright John Gerzema/Young & Rubicam

ONE STORY IN
THE AMERICAN NIGHTMARE

20 Source:New York Times Copyright John Gerzema/Young & Rubicam

 A GROWING REALITY:
A MORTGAGE IS FOREVER

21 11
19 Copyright John Gerzema/Young & Rubicam
 THE ONLY CERTAINTY IS
UNCERTAINTY

24 Copyright John Gerzema/Young & Rubicam

YES WE CAN?

22 Source: Pew Research Center

 MASLOW UPENDED:
MARKETING MUST MOVE FROM PASSION TO COMPASSION

20
07

20
19 Source: American Progress.org February 2009
90 Copyright John Gerzema/Young & Rubicam
“WE HAVE A STRONG
CAPITAL POSITION”

27
23
TECTONIC SHIFTS IN CONSUMERISM:
LACK OF
DECAYING PERMANENCE LACK OF
INFRASTRUCTURE LEADERSHIP AND
RESPONSIBILITY

TAXPAYERS SELFISHNESS
ARE NOW
SHAREHOLDERS TRUST AND
COLLUSION

FAILURE OF
REGULATORS PROLONGED
CONFLICTS AND
EGREGIOUS PARTISANSHIP
AND CRIMINAL
BEHAVIOR

28
LACK OF LEADERSHIP
AND RESPONSIBILITY

29
26
SELFISHNESS AND
COLLUSION

27 Copyright John Gerzema/Young & Rubicam

 PROLONGED CONFLICTS
AND PARTISANSHIP

28
 EGREGIOUS AND CRIMINAL
BEHAVIOR

29 Copyright John Gerzema/Young & Rubicam

FAILURE OF REGULATORS

30 Copyright John Gerzema/Young & Rubicam

 TAXPAYERS ARE NOW
SHAREHOLDERS

31
25 Copyright John Gerzema/Young & Rubicam
DECAYING INFRASTRUCTURE

32 Copyright John Gerzema/Young & Rubicam

LACK OF PERMANENCE

33 Copyright John Gerzema/Young & Rubicam

THE NEW CULTURAL
FAULT LINE

34
37
28
35 Copyright John Gerzema/Young & Rubicam
WE EXAMINED 15 YEARS
OF DATA FROM BRANDASSET
VALUATOR®

WORLD’S LARGEST 40,000 BRANDS QUARTERLY U.S.

DATABASE OF PANEL OF
BRANDS 215 STUDIES 15,000+
RESPONDENTS
OVER 500,00 ACROSS 44
CONSUMERS COUNTRIES 72 DIFFERENT
BRAND METRICS

39
BRANDS NOW ACCOUNT
FOR 30% OF THE VALUE OF
THE S&P 500

Source: Millward Brown Optimor 2007

30
37 Copyright John Gerzema/Young & Rubicam
THE 250 MOST VALUABLE
GLOBAL BRANDS ARE
$2.197 TRILLION DOLLARS
WHICH EXCEEDS THE GDP
OF FRANCE

31
38 Copyright John Gerzema/Young & Rubicam
 BRAND ESTEEM AND
REGARD IS DOWN 12%

BRAND AWARENESS HAS

DECLINED BY 20%

PERCEPTIONS OF BRAND
QUALITY HAS ERODED 24%

TRUST IN BRANDS HAS

DECLINED BY 50%

39 32
39 Copyright John Gerzema/Young & Rubicam
 TRUST IS DESIRABLE, BUT IT HASN’T
DIFFERENTIATED

40 Source:BrandAsset Valuator 1993-2007 Copyright John Gerzema/Young & Rubicam

 IN THE PAST QUARTER, A ‘TRUST VIRUS’
INFECTED MANY CATEGORIES

41
Source: BAV USA FY2006, FY2007, Q4 2007, Q4 2008; All Adults
Copyright John Gerzema/Young & Rubicam
42
“I SCREWED UP”
Source: Barack Obama Press Conference, February 2009 Copyright John Gerzema/Young & Rubicam
 CONSUMERS ARE BEGINNING
TO OWN THEIR PROBLEMS

43 Source: Time Magazine Copyright John Gerzema/Young & Rubicam

THEY REALIZE THERE’S A LONG,
HARD SLOG AHEAD

44 Source: Reinhart and Rogoff, The Aftermath of Financial Crises, 2009

 SAVINGS RATE HAS RISEN IN PAST FIVE
CONSECUTIVE MONTHS

45 Source: U.S. Department of Commerce: Bureau of Economic Analysis Copyright John Gerzema/Young & Rubicam
 Q4 SPENDING FELL 3.7% FROM Q3 -
STEEPEST DECLINE IN 62 YEARS.
$3 TRILLION IN SPENDING STOPPED IN Q4, WAS SUSTAINING US GDP

46 Source: www.calculatedriskblog.com Copyright John Gerzema/Young & Rubicam

MOST POPULAR TAG’S ABOUT
CONSUMER BEHAVIOR

50 Source: Gabriel Dance, Aron PIlhofer and Andrew Kueneman - New York Times
CREATE COMPETITIVE
ADVANTAGE NOW

EVERY RECESSION ENDS...EVENTUALLY

CONSUMERS MOVING FROM ANXIETY TO ACTION

HOW YOU ACT NOW WILL SHAPE YOUR FUTURE

PERFORMANCE

48
39 Copyright John Gerzema/Young & Rubicam
THE NEW RULES OF
‘POST-CRISIS CONSUMERISM’

NEW CULTURAL VALUES

NEW CONSUMER BEHAVIORS

NEW MANAGEMENT PRINCIPLES

49 Copyright John Gerzema/Young & Rubicam

 POST-CRISIS CONSUMERISM
RULE #1

CULTURAL VALUE = LIQUID LIFE

CONSUMER STRATEGY = DÉCLASSÉ

CONSUMPTION

MANAGEMENT = DOLLARS AND

PRINCIPLE SENSE

56 Copyright John Gerzema/Young & Rubicam

DÉCLASSÉ
CULTURAL VALUE=LIQUID LIFE
CONSUMER BEHAVIOR = DÉCLASSÉ CONSUMPTION
MANAGEMENT PRINCIPLE= DOLLARS AND SENSE

CONSUMPTION

54
Copyright John Gerzema/Young & Rubicam
 CULTURAL VALUE=LIQUID LIFE

DOLLARS AND SENSE CONSUMER BEHAVIOR = DÉCLASSÉ CONSUMPTION

MANAGEMENT PRINCIPLE= DOLLARS AND SENSE

55
Copyright John Gerzema/Young & Rubicam
POST-CRISIS CONSUMERISM
RULE #2

CULTURAL VALUE = ETHICS AND

FAIR PLAY

CONSUMER STRATEGY = EMPATHY AND

RESPECT

MANAGEMENT = VALUE AND

PRINCIPLE VALUES

56
Copyright John Gerzema/Young & Rubicam
EMPATHY AND RESPECT
CULTURAL VALUE = ETHICS AND FAIR PLAY
CONSUMER BEHAVIOR = R-E-S-P-E-C-T
MANAGEMENT PRINCIPLE = VALUE AND VALUES

54 Copyright John Gerzema/Young & Rubicam

 CULTURAL VALUE = ETHICS AND FAIR PLAY

VALUE AND VALUES

CONSUMER BEHAVIOR = R-E-S-P-E-C-T
MANAGEMENT PRINCIPLE = VALUE AND VALUES

55 Copyright John Gerzema/Young & Rubicam

 POST-CRISIS CONSUMERISM
RULE #3

CULTURAL VALUE = INDESTRUCTIBLE

SPIRIT

CONSUMER STRATEGY = DURABLE LIVING

MANAGEMENT = BRAND THAT

PRINCIPLE LASTS

50 Copyright John Gerzema/Young & Rubicam

 CULTURAL VALUE = INDESTRUCTIBLE SPIRIT

DURABLE LIVING CONSUMER BEHAVIOR = DURABLE LIVING

MANAGEMENT PRINCIPLE = BRAND THAT LASTS

51 Copyright John Gerzema/Young & Rubicam

 CULTURAL VALUE = INDESTRUCTIBLE SPIRIT

BRAND THAT LASTS CONSUMER BEHAVIOR = DURABLE LIVING

MANAGEMENT PRINCIPLE = BRAND THAT LASTS

61
Copyright John Gerzema/Young & Rubicam
 POST-CRISIS CONSUMERISM
RULE #4

CULTURAL VALUE = RETURN TO THE

FOLD

CONSUMER STRATEGY = COOPERATIVE

CONSUMERISM

MANAGEMENT = COMMUNITY
PRINCIPLE ORGANIZER

59 Copyright John Gerzema/Young & Rubicam

 CULTURAL VALUE = RETURN TO THE FOLD

COOPERATIVE CONSUMER BEHAVIOR = COOPERATIVE CONSUMERISM

MANAGEMENT PRINCIPLE= COMMUNITY ORGANIZER

CONSUMERISM

63
Copyright John Gerzema/Young & Rubicam
 CULTURAL VALUE = RETURN TO THE FOLD

COMMUNITY ORGANIZER CONSUMER BEHAVIOR = COOPERATIVE CONSUMERISM

MANAGEMENT PRINCIPLE= COMMUNITY ORGANIZER

64
Copyright John Gerzema/Young & Rubicam
THE OPPORTUNISTIC CEO:
BRAND MANAGER IN CHIEF

53 Copyright John Gerzema/Young & Rubicam

MARKETING IS NOT A COST, BUT
A FIDUCIARY RESPONSIBILITY
TO SHAREHOLDERS

54 Copyright John Gerzema/Young & Rubicam

THE CHINESE CHARACTER FOR
CRISIS ALSO MEANS OPPORTUNITY

BAD COMPANIES ARE DESTROYED

BY CRISIS. GOOD COMPANIES
SURVIVE THEM. GREAT COMPANIES
ARE IMPROVED BY THEM.”
—ANDY GROVE

65 Copyright John Gerzema/Young & Rubicam

RECESSION-PROOF
YOUR BRAND

JOIN THE CONVERSATION AT

THEBRANDBUBBLE.COM
ON FACEBOOK
OR TWITTER
@JOHNGERZEMA

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