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In those far more innocent days before Sept. 11, Acirca Inc., an
organic-food company based in New Rochelle, N.Y., was readying a massive
campaign to give away free samples of its Walnut Acres line of soups and
salsas. Starting on Sept. 15, youthful workers were to fan out in New
York and Seattle to hand out goodies to thousands of consumers, hoping
to introduce the brand and its healthy-lifestyle message.
That was then. Now the sampling blitz is on hold because of stepped-up
security in the crowded urban areas where sampling works best -- and
because the mood among consumers is likely to turn more sober and
reflective. "We try to create an environment that's educational and
entertaining, but that's hard to do when the country has been devastated
by an act of terrorism, confidence has been destroyed, and people feel
vulnerable," says Michael Neuwirth, Acirca's corporate communications
director.
In a country already gloomy about its economic prospects, the attacks likely will mark the abrupt end of the free-spending zeitgeist of the 1990s. As shocked Americans come to grips with just how dangerous the world can be, there is a real risk that they will further cut back on the spending that has sustained the economy so far this year.
DOWNWARD REVISION. In that climate, marketers' exhortations to indulge in ostentatious spending, make minute distinctions among equivalent brands -- or even adopt a healthier lifestyle -- could ring hollow. For marketers already on the fence about maintaining budgets, it could be tempting to dial back ads reaching out to a distracted and depressed public. It all adds up to a new blow to ad spending that had been slumping for months. Just two weeks ago, Merrill Lynch & Co. media analyst Lauren Rich Fine revised
her ad-spending projections for this year from the 0.7% decline she forecast in June to a steeper 4% drop. For 2002, she sees a tepid 1% uptick.
The situation is reminiscent of a decade ago, when the gulf war
drastically damped travel and other business activity, crushed consumer
confidence, and prompted marketers to "defer" ads. Often, they promised
to restore spending, but that year's 2% decline showed that few did.
Are we in for a replay? Marketers are just beginning to grapple with the
new reality. At Snapple Beverage in White Plains, N.Y., the first
reaction was to rush drinks to an emergency staging area. Later could
come debate over whether to proceed with several new products -- including
one with a suddenly inaccurate image of the New York skyline cut into
the glass bottle, says Chief Marketing Officer Michael Sands.
"FEAR FACTOR." Certainly, the immediate impact was extensive: retail shutdowns, canceled entertainment and sporting events, postponed business meetings. There were rumblings that TV networks, already losing millions as news crowds out ads, might delay the Sept. 17 start of the ad-rich fall season. Leisure and travel, makers of autos and appliances, all could hold off on spending, at least for now. "There could be a fear factor, a retrenchment, a thought of not wanting to take risks," acknowledges Ellis Verdi, president of New York agency DeVito/Verdi.
Expect a change in tone, as marketers abandon the frivolous appeals to
self-indulgence of the boom years for an emphasis on family, community,
patriotism, and other enduring values. "Marketers will be afraid to use
black humor right now, since there is nothing funny or whimsical about
thousands dying," says Marian Salzman, global director for strategy and
branding at Euro RSCG Worldwide. "'Kinder and gentler' will be the new
theme. Think Hallmark cards vs. Sony PlayStation."
For now, marketers and their agencies are putting on their bravest face.
"Our lives have changed, and we don't know how yet, but we have great
confidence in the American economy," says Steven G. Felsher,
vice-chairman of Grey Global Group Inc. As Americans sort through those
larger issues, ad campaigns likely will come back down to earth, in tone
and in spending.
By Gerry Khermouch in New York
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Copyright 2001 , by The McGraw-Hill Companies Inc. All rights reserved.
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