Impact of Ad Spending: Part I
Three brands that invested in marketing campaigns during a recession are Nike, Domino’s Pizza, and Kellog’s. Nike focused on making their brand more inclusive while Domino's Pizza dedicated this time to market research and developing a new recipe. Kellog's used the Great Depression period to increase its marketing efforts and create value deals while its competitors reduced their marketing activity.
- Following the 1987 stock market crash, Nike was able to triple its marketing budget and get profits nine times higher than before the crash.
- In 1988, Nike's executives and marketing specialists realized that the brand was only targeting high-ranked athletes for their sportswear.
- They decided to include all persons in sports and fitness, launching the “Just Do It” campaign in 1988.
- In launching this campaign, they predicted spending over three times the $5 million figure they had for the previous campaign “Revolution.”
- This launch would make Nike become a major network television advisor.
- The core of the campaign was the “Just Do It” slogan, selling the idea that anyone could be an athlete, thus, making the brand appealing to everyone.
- After its launch, Nike’s sales moved from $877 million to $9.3 billion.
- When the recession hit in 2008, Domino’s was not the most popular pizza establishment in America.
- In 2009, Domino’s decided to spend millions in research and marketing, changing its signature pizza recipe and launching a new campaign.
- Domino's Pizza ran a $70 million campaign to launch its new recipe. The campaign ran through television commercials on major prime-time networks like ABC, CBS, and NBC, as well as sixty-second radio spots and WebVideo used for customer feedback.
- This marketing effort was the largest one made by the company, since its video scandal earlier in the same year.
- Domino's revenue increased to $302.7 million in the last quarter of 2009. This was a 6.5% increase from the same period in 2008.
- During the Great Depression that took place between 1929 and1939, Kellogg's benefited from its aggressive marketing in a time when all their competitors reduced their marketing efforts.
- Consumers didn’t stop spending altogether during the depression but instead focused on brands that offered good deals for valuable products. Companies providing these good-value deals were the ones that benefited during this time.
- Kellog’s doubled its advertising budget while Post, its competitor during that time, reduced theirs. Kellog’s used this to their advantage, diving deep into radio advertising and pushing its new Rice Krispies cereal.
- Despite the terrible recession occurring, by 1933, Kellog’s had increased their sales by 30% as a result of their increased advertising strategies.
- Following the 2008 recession, Kellog’s launched numerous marketing campaigns. During this period, they also turned to social media marketing, using Twitter and Facebook for advertising purposes.
We began our research of the three brands that increased marketing during a recession by marketing websites like BSO Multimedia and Strategic Growth Concepts. We also visited news articles from sites like Entrepreneur.
After finding our three brands, we further dove into their history by checking expert blog pages, news articles, and marketing websites. Strategic Growth Concepts and Branding Strategy Inside provided information about Nike during the 1987 recession. We found their marketing strategy during this period and the effects of their efforts compared to their competitors.
We also found case studies about Domino’s Pizza on articles by the Guardian and Forbes. These articles provided information about Domino’s strategy and the results they got from their efforts. Finally, we found information about Kellog’s marketing strategy during the Great Depression on blog websites like Spin Sucks and Polr. We also found the actions taken by Kellog’s during this period and the results that came from this.