Words have consequences: let's not talk ourselves into a recession

There’s a story Ogilvy’s Rory Sutherland tells in his book Alchemy about a Belgian biscuit manufacturer that swapped its market-leading biscuit brand for a low-fat version. Sales collapsed overnight.

The manufacturer was confused. In extensive blind tastings consumers hadn’t noticed any difference in taste between the successful full-fat biscuits and their low-fat replacement. Actually, the problem wasn’t how the biscuits tasted – the problem was what was written on the packaging of the new variant.

Words highlighting the reduced fat content led consumers to conclude that the new biscuits weren’t as nice as the old ones. So they stopped buying. The packaging made the new biscuits taste worse. People don’t just eat food, they eat words; and the taste of the former is outdone by the taste of the latter, says Sutherland, quoting from the Polish-American academic Alfred Korzybski.

Anyone who works in marketing understands the power of words and should also understand that the way people respond to words is often instinctive and illogical. It’s time to apply some of that thinking to the way we talk about marketing itself.

There’s a real danger we compound the current inflationary and cost-of-living challenges through a relentlessly bleak dialogue about the ad industry itself. From the talent crisis to the challenges of flexible working; from the ‘low’ wages to the high-pressured new business culture; from the slow progress on DE&I to driving unsustainable consumerism – the negative narrative around the ad industry is hardly helpful when it comes to persuading brand owners that agencies are their business allies.

When we allow that sort of ‘packaging’ of the agency business to take hold, it’s much harder to counter the inevitable attempts to reduce agency fees and cut ad budgets when the economy takes a hit.

In the past few weeks some brand owners have moved fast to decimate their ad budgets, predictably focussing on advertising and marketing as a variable cost that can be slashed quickly and damn the long-term consequences (if they even believe there will be long-term consequences).

And instead of meeting these cuts by holding firm to the value of what they do, some agencies are already responding by reducing their fees and offering clients slimmed-down, low-fat services. And damn the long-term consequences.

But this is not the time to produce less-good, less-effective but cheaper work. This is not the time to introduce virtual production processes that replace quality creative craft with cheap CGI work. This is not the time to do even more for less. The agencies that blink will lose, just as those brands that are reducing their marketing investment will lose.

This is the time for agencies to continue to invest in the best talent; to invest in new tools and techniques to make the work more creative and more effective; to do, in fact, what forests of industry research tell marketers that brands should be doing: invest your way through the tough times.

The agency trade body the IPA last week warned marketers to expect beleaguered agencies to push for fee increases. This shouldn’t even need saying, let alone justifying. And marketers and agencies should be on the same side when it comes to supporting continued investment; those CMOs who are prepared to put the squeeze on their agencies right now are only undermining the value of a significant part of the marketing function itself.

No-one is naive to the brutal realities of the current economic situation, but it will pass and we need to make sure there’s a strong, effective advertising and marketing industry ready for the return of growth. Making sure the words on the ‘packaging’ are promoting quality and confidence is crucial to maintaining customer satisfaction through the lean years.