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LinkedIn Industry Trends | Ritzholtz | Full Story

 

So what constitutes a brand, really?

In a recent Warc Blog entry , author Robert Passikoff (President of firm Brand Keys) gives a good definition: He defines it as “a name, term, symbol, or combination thereof that identifies goods and services so strongly imbued with values, and articulated and emotional meaning, as to be easily differentiated by the public from the competition.”

He then builds on this characterization to question trending industry “chatter” that regards consumers who, in tightening their belts, as having become brand disloyal by transferring purchases from once-favored brands to cheaper alternatives.

And he’s right in one thing, there’s a lot of business reporting lately about consumers’ changing buying habits. Global management consulting firm McKinsey & Company reported as early as 2009 that consumers are purchasing lower-priced brands that they have in years past (in any given CPG category, an average of 18% of consumers bought lower-priced brands in the past two years). Similar findings have been issued by like organizations (i.e. Bloomberg) since then.

But what are these reports talking about when they say ‘brand’? Consumers, past and present, want value – either in terms of bang for their buck or an emotional reward. Passikoff doesn’t think that today’s consumers are being disloyal; they’re just scrutinizing a brand’s value proposition more closely now than they have in recent past. Brands can’t compete on recognition alone in today’s marketplace; they have to provide some substantial meaning to their customers. Brands with high awareness and little value, he says, aren’t truly brands. They are ‘category placeholders.’

Now that's brand loyalty

His argument is both classic and timely – A brand should always know its core values and meaning, and believe in their proposition well enough to convincingly articulate it to consumers. When things get lean, it means you just have to work harder: to make sure that a brand’s proposition is expressed in a compelling way, and that the brand promise is delivered.

What’s tough now is that consumer relationships with media are changing rapidly from passive receptivity to user-controlled experience. Some even anticipate a future where technology and its users will approach a merged experience. So I for one hope that Mr. Passikoff is right and that, as we grapple to understand how people relate to ads differently on TV versus online, in traditional ads versus those in social networking sites, etc., we can rely on some constants. People will always respond to real value.

Last week, Patty Hannon’s post “Birth and Rebirth” introduced us to one city’s quest for change in the face of destitution and devastation. In many ways, Detroit’s rebirth is generated through re-use and re-purposing. “Urban prairies” bring sun, soil, and plants to steel and asphalt-encrusted city structures, while innovative contractors rely on harvest maps to help them locate reusable building materials close to their construction site.

This week, in a moment of synchronicity, my ears tuned into NPR’s Special Series “Cities in Transition.” Like Patty’s exploration of Detroit’s growing pains, the series focuses on other major US cities who have experienced a significant degree of change in economics or demographics as a result of the Great Recession. Some significant examples are Portland’s magnet-like attraction for young twenty-somethings despite a lack of available jobs and Phoenix’s job economy’s ability to sustain foreign-born workers easier than U.S. natives. Today the series closed out with an insightful meditation on racial segregation in the U.S. housing market. If you missed the series or are curious about any of the transition trends mentioned, click here to access it.

Cast from the IFC series "Portlandia";a new dramedy that features the quirky absurdities of youth counter-culture and city trends.

Few fans of the magazine Gourmet expected the November issue of 2009 to be its last. However, a struggling economy, along with the internet, has made it hard for many magazines to survive.

After nearly 70 years, publisher Condé Nast abruptly stopped production of the monthly magazine due to lack of advertising sales and a shift in consumer interest. At the time of Condé Nast’s decision, both Gourmet and its sister magazine, Bon Appétit, were struggling with ad sales. Bon Appétit made the cut. Gourmet didn’t. Bon Appétit was offered as a substitute for Gourmet for the remainder of almost one million subscriptions.

Since then a slight margin (a slim 20 percent to be exact) of past Gourmet subscribers have chosen to switch to Bon Appétit. This seems odd for such highly dedicated and long-term subscribers. The lack of transferred subscriptions poses a hard question. Why did Condé Nast choose not to research the niche market of such an obviously successful magazine like Gourmet in order to keep those dedicated subscribers?

On the cover, the magazines look similar. Both share great recipes. Both feature articles about food, culture, and politics. However, the audiences of each magazine differ greatly. This is evidenced through both magazines advertisements as well as their contrasting takes on good living. Gourmet was luxurious and indulgent. It stressed extravagant travel and an elitist lifestyle. Bon Appétit stresses a comfortable home life, centering on family cooking. It offered complex, yet more accessible recipes.

While many Gourmet readers feel heartbroken about no longer receiving the magazine each month, Condé Nast’s decision makes good sense, especially when considering the economic forecast that sunk Gourmet. Foodies aren’t paying for exotic trips to experience food anymore. They’re cooking at home with their families, growing their own gardens, or buying local food.  Despite a large fan base, Gourmet’s attention to life’s luxuries and hefty subscription fees failed to keep advertisers interested. In the case of Gourmet and many other magazines, ad money trumps readership and loyalty.

But after loosing 800,000 subscribers, it seems that Condé Nast missed a really great chance to study their Gourmet readers. The magazine may have been out-of-touch with the current economic reality, but its subscribers were still writing checks every year. If Condé Nast saw the end of Gourmet magazine in sight, why not find out what it was that appealed to readers and kept some subscribing for decades. That sort of insight would have been exactly what Condé Nast could have used to align Bon Appétit toward the views and preferences of Gourmet’s readers in order to boost the number of subscription transfers and keep those loyal consumers.

Halloween in Chapel Hill has historically drawn huge crowds, sexy costumes, and drunken debauchery to Franklin Street. In 2007, nearly 80,000 people showed up to partake in the festivities. However, due to fears of crime, alcohol poising and gang-related violence, that number declined last year to 35,000. From the look of things, falling numbers threaten the Chapel Hill Halloween tradition again this year.

The number of bodies on Franklin Street is not the only thing declining. According to MPR, Americans are expected to spend 15% less on Halloween than last year due to the poor economy. Downscaling makes sense given that Halloween is only one day out of the whole year, but for a Chapel Hill-ian of four years and true Halloween enthusiast, any further downsizing would be an absolute atrocity.

So put on your best vampire and dead celebrity costumes and come out to Franklin Street on October 31st. Don’t let the tradition of Halloween go down with the economy.

anatomy of a crash

Over the course of the past year, there have been many attempts to illustrate just how bad this leg of the economic cycle has been. However, this week’s infographic is perhaps the best I’ve yet seen in representing the housing crisis. I’ve said before that the primary purpose of an infographic is to convey a story, and while this infographic may not be the most aesthetically appealing, it certainly serves its purpose very well.

Housing Prices

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