Marketers face uncertainty ahead

The events of Sept. 11 have had a 'profound psychological impact' not just on consumers but also on decision makers, says Jacques Duval, president and CEO of Marketel/McCann-Erickson in Montreal. To that end, he believes it is up to Canada's marketers to take a lead role in re-igniting the economy - a task easier said than done, he admits.

The events of Sept. 11 have had a ‘profound psychological impact’ not just on consumers but also on decision makers, says Jacques Duval, president and CEO of Marketel/McCann-Erickson in Montreal. To that end, he believes it is up to Canada’s marketers to take a lead role in re-igniting the economy – a task easier said than done, he admits.

‘Our world has changed overnight. How can we make assessments when we’re not sure how solid the ground is?’ he asks.

‘Historically marketers have always been in charge of crystal-balling, being ahead of the parade. The pressure is on marketers to basically lead the corporations and the economy.’

Frank Palmer, chairman and CEO of Palmer Jarvis DDB in Vancouver, says that agencies need to be ready to step in with advice to clients that goes beyond urging them to continue spending.

He believes that in times of crisis good agencies will come up with creative solutions and provide guidance, sometimes in more areas than just advertising. He says experienced agency people who have been through similar circumstances can help keep clients motivated and moving in the right direction.

‘In some cases it’s not advertising. They may be interested in other things that relate to their business. Maybe it’s a staff motivation thing,’ he says.

Palmer predicts that in many cases clients will discover that their agencies are not up to the task of being leaders in a downturn. He believes the fallout will result in more agency reviews in the coming months. ‘There’s going to be a culling out,’ he says.

Palmer is among the profusion of agency industry executives who say marketers must continue to advertise in a soft economy because history indicates that they will be the ones to emerge with stronger brands.

Another adherent is Gerry Frascione, president of BBDO Canada in Toronto. Frascione’s advice to his clients is that in economic downturns they must stick to the fundamentals of good brand building – what is also known as the ‘discipline of market leaders.’

‘Know your customers, surround them with one voice and be bold and daring from a creative point of view,’ he advises. ‘It’s important for brand leaders, for market leaders, to sustain their level of investment in tough economic times.’

Indeed, while events of Sept. 11 put an immediate halt to ad spends in certain sectors, others have continued to advertise with barely a hiccup. New campaigns by TD Canada Trust, Coca-Cola and Bell Canada have all launched in recent weeks.

The only stall resulted from the wall-to-wall news coverage in the days following the attacks, which bumped TV ads on every major network for the remainder of that week.

‘At this time of year a lot of our budget would already be allocated in marketing and advertising,’ says Norm Berberich, spokesman for Bell Canada, who adds that the company has no plans to hold ads in the short term. But ‘in the long term I think it’s too early to tell how a (decline in the economy linked to Sept. 11) would affect budgets,’ he adds.

Since Canada never experienced the Web-based plateau, the economic decline had been slower all along. And the attacks, while close to home, do not appear to have had the same net effect.

‘We get fooled by listening to what’s happening in the U.S. and what people are doing there. It won’t be the same here,’ says Alan Middleton an assistant professor of marketing at the Schulich School of Business at York University in Toronto.

‘The obvious industries have been and will be hit, which are airlines, hotels and tourism in general.’

‘Right now, there is an increased feeling of cautiousness. But we haven’t seen any kind of dramatic cutbacks or anything like that,’ says Dom Caruso, president and CEO of Toronto’s MacLaren McCann.

‘Overall, this year has been one where people have been cautious and we’ve had certain clients cut back a bit on their spending because of that. But I can’t say that I’ve seen any of that accelerate since Sept. 11.’

Marketel’s Duval, whose clients include Air Canada, Tourism Quebec and Tourism Montreal, says his clients both in the travel sector and otherwise are taking a wait-and-see approach.

‘In terms of budgets, that means let’s pull everything we can right now, but let’s not cancel that money, and let’s see what happens in Q1 2002.’

Some observers believe that a decrease in air travel will result in the telecommunications industry finding itself increasingly important to companies working on the international market.

Indeed, since Sept. 11, cell phone sales have increased, according to two of the nations top service providers, Telus and Rogers AT&T.

‘Any teleconferencing technologies are going to do extremely well,’ says Caruso whose clients include Rogers AT&T and Microsoft.

‘I’d say Microsoft is very well positioned, just because they’ve got so many different applications that allow people to communicate online.’

But beyond the telecom sector, in the game of predicting which sectors have the propensity to thrive in this post Sept. 11-world, all bets are off.