2009: What's new in "brand"?



Depending on the industry we're talking about, 2009 can be seen as a year that started things off completely badly, but it can also bring new opportunities.

Since Brandweek doesn't have a team of economic analysts, this assessment is certainly more difficult, as we are only judging based on historical speculation.

Predictions won’t go too far, for now, one thing we can be sure of is that 2009 was not a good year for the auto industry, and it’s likely that the advertising industry will suffer the same fate. At the same time, the economic outlook is getting worse, consumers are clinging to their cars and are not keen on buying a new one, however, some signs are also showing that the auto industry will grow quite a bit this year and we can expect that there is still a way for auto advertising in 2009.

But other industries are looking shaky. Most packaged goods companies spent big on advertising and marketing, raised prices in 2008, and expect to continue to see decent growth. But later this year, private-sector competitors will launch their invasions.

Will 2009 be the year when consumers make a more decisive decision and abandon their favorite brands for cheaper mass-market brands? This is certainly possible, especially as the economic downturn continues. 

Can big-name packaged goods convince consumers that they’re getting the same quality at the same price? Maybe, although private labels have yet to come together and speak with a single voice.

In the short term, 2009 will be a test of the brand’s health. The Big Money website is ready to publish “The Dark Side of Great Brand Myths,” and the title alone is worth the price: “Do you think Microsoft would sell fewer copies of Office if it changed its name in the future?” writes Mark Gimein. And many have suggested the same thing before. 

In 2004, for Wired, James Surowiecki argued that “The transparency of the Web will help consumers see through brands.” While that may seem like a reasonable statement, it’s not entirely convincing. Does anyone really think that Office sales won’t be impacted by Microsoft’s rebranding? And as we can see, the brand is the most valuable thing. And this year will be our chance to prove it.

Auto industry: A bad year with federal help.


Both domestic and foreign automakers are cutting spending this year as production lines are idled and sales slump, and only a more aggressive fiscal policy can save the day.

Anthony Crupi, Mediaweek

Although nearly every American citizen admittedly believed that the auto industry in 2008 had taken a terrible downturn, they still believed that the road ahead for the giant American auto industry was still wide open.

Looking at the other side of the economic crisis, big auto corporations like General Motors and Chrysler as of March 31 still showed a strong ability to survive the long and thorny period ahead, and their work mainly revolved around concessions to suppliers, creditors, and the United Auto Workers.

The views expressed in the negotiations, the debt-for-asset swap may not satisfy both sides, forcing the Detroit company to end its 26-year sales slump, at a time when intermediaries cannot afford to prolong the debt situation.

As the three-way battle rages on, production has ground to a halt, causing a ripple effect on marketing. Even Ford, which will receive a portion of the $17.4 billion federal auto bailout, has slashed its advertising budget by $101 billion next year. 

And GM, the only remaining automaker, increased its advertising spending in 2008 from February to September, raising media spending to $15.71 billion for TNS – the nation's third largest advertising company-to continue to sponsor the Super Bowl and Academy Awards.

Part of the plan to revive GM and other automakers is to cut $600 million from advertising by 2012. That's a big cut, and GM will continue to flex its marketing muscles in promotions like the 2010 Chevrolet Equinox, which hits showrooms this summer.

Unfortunately, media spending is tied to the fast-moving car market, which doesn’t look like it’s going to improve anytime soon for the automakers. Honda’s full-year profit fell by $621 billion in late December as the global crisis and consumer confidence spiraled. Toyota, meanwhile, warned that it would be its first major loss in history.

Observers hope that Obama’s new policies will be more favorable to Detroit. “The persistent debt will no longer be able to wait for Detroit to survive the crisis of 2009,” said George Magliano, an analyst at IHS Global Insight, who also advised that only a huge amount of money will be able to save the city, otherwise there will be no choice but bankruptcy.

As for labor, according to the Center for Automotive Research, only a three-way agreement between manufacturers, creditors, and the government can keep workers employed, or 2.95 million jobs will disappear. The $17.4 billion figure seems insignificant, but perhaps by March, policy and Congress will be more willing to help.

According to Brandweek