Recession Zeitgeist: Office Politics, Upcoming Talent Wars … Ad CEOs Think its over … the Economist Doesn’t

Recession Ups Backstabbing and Sucking Up
More than four in 10 US employees say they are encountering increased workplace backstabbing, “sucking up” and politicking as co-workers take desperate measures to stay employed amid widespread fears of layoffs during the recession, according to a study conducted by Professor Wayne Hochwarter out of Florida State University.

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many employers, you may soon be facing a “resume tsumani” when valued workers who have been with you through the recession start flooding the market with CVs as the economy improves. Planning for post-recession turnover may determine whether you’re among the talent winners or losers when the economy improves.
Global ad Omnicom Group Inc. and Publicis Groupe SA reported significant declines in revenue and profit but indicated a bottom may be at hand in the global advertising downturn. “We don’t see a recovery, but we feel we’ve hit the troughs,” said John Wren, chief executive of Omnicom. He added that it will take a couple of quarters to cycle through the current downturn, and a couple more before growth comes. “We believe the worst is behind us,” said Publicis Chief Executive Maurice Lévy. “All figures should be less in decline in the third quarter than in the second quarter.”
The global slump has reached its trough. Asia’s economies are looking rosier, buoyed by a spectacular rebound in China, where output grew at an annualised rate of some 16% between April and June. Even in America and the euro area, GDP is likely to stop shrinking during the summer. Trade, having fallen precipitately, is levelling off (see article). And, as firms rebuild their stocks, global growth over the next few months could be surprisingly robust. That is a welcome prospect. But it is not the all-clear. For this “recovery” has fragile foundations
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What the pundits say, What CMOs say, What marketers are doing

Companies and brands that went with the flow of the boom-bust cycle by cutting ad spending — as data suggest household and personal-care players did last year — tended to lose more share to private labels both immediately and longer term. Companies whose ad spending didn’t vary according to economic cycles — based on an analysis of Ad Age data on global ad spending — also tended to increase their stock prices an average of 1.3 percentage points annually ahead of others from 1986 to 2006, said Mr. Steenkamp, who analyzed global results of 26 marketers across multiple industries.
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“Marketing, we are happy to report, is not running scared from the economy by slashing budgets and headcount. Instead, marketing is getting back to our key function: driving business and opportunity to sales and owning the customer experience.”

Companies continued to reduce marketing budgets in the first quarter of 2009 but the rate of decline has slowed, according to the IPA‘s Bellwether survey. In the first quarter, the net balance of companies reporting an increase in budgets was -34%, which compares to the record low reading of -42% in the fourth quarter of last year.
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Hipsters, GTbyCITROEN, Photomake, Gates v PC, TV Ads Work

Hipsters Will Save Our Economy

In a rather striking article this week, Forbes recognizes hipsters as possibly the one demographic group that’s still happily consuming, at least in the retail sector. The article argues that while hipsters – here very broadly defined – might not make a lot of money now, they are a huge, powerful consumer group, and marketing dollars spent to capture them now will likely pay off in the future. Not to mention the fact that, even today, retailers which cater to the “creative class” are thriving while the rest of the retail industry struggles:

The gaming world merged with reality this week at the Paris auto show with the unveiling of the GTbyCITROËN. The sportscar is the first ever car to be specifically designed to bring the virtual and real worlds together. The French car maker partnered with Polyphony Digital Inc, the creators of the Gran Turismo series to stretch their creative vision.The exterior design of the car is a modern look at a racing coupe. The concept uses sharp body lines and dynamic shapes to communicate performance and speed. In the game version the car is powered by a zero emission fuel cell and electric drivetrain. There’s no word on if the physical prototype runs. For now the ‘Citroën GT’ represents one automaker embracing the gaming world and testing out how to potentially integrate it into product development.
Photomake is a very cool web service that will translate line drawings into solid objects. Like a 2 dimensional version of Shapeways, the site makes it really easy to create unique objects. All you have to do is draw something, scan it – or even take a photo of it, upload it to the site, and in a few days you’ll have a custom item. They offer a bunch of different subsrtes including 17 different colors of acrylic, styrene and plywood. People have been making all kinds of interesting objects with photomake, like jewelery, furniture and art sculptures.

Why Microsoft’s Gates/Seinfeld Went Viral and ‘I’m a PC’ Ads Didn’t
According to Visible Measures, which charts online video viewing trends and has measured the videos associated with Microsoft’s $300 million ad campaign, the Seinfeld/Gates ads are squashing the “I’m a PC” ads by a margin of 4.3 million viral video views. Both ads had about equal video placements (about 75 each). Visible Measures points out that while the Seinfeld/Gates clips came out two weeks earlier than the “I’m a PC” ads, Seinfeld/Gates drew twice as many viewers their first week in market than the PC ads did. After two weeks in market, Visible Measures says, “Seinfeld/Gates was still collecting more than 700,000 views per day, while the ‘I’m a PC’ clips had tapered off to less than 50,000 views per day.” Why might this be? Microsoft sparked a dialogue in the Seinfeld ad that isn’t there in PC ads.

Now a neuromarketing study finds that viewers aren’t zoning out, but actually pay attention to ads when hitting their fast-forward button. “Our conclusion was that people don’t skip ads,” said Carl Marci, cofounder and CEO of Innerscope Research. “They’re just processing them differently.”

Crisis? What Crisis?

Ad Age asked all the holding company chiefs for their view on the turbulent economy. Here’s the CEO mashup: “Obviously, we are shocked by the fall of such significant and powerful financial institutions … The moves in the stock market during the last two weeks are unprecedented … The volatility in the financial markets is clearly creating uncertainty for both marketers and consumers … It is changing by the hour. You’ve seen in a few days the stock price of Goldman Sachs go down by 40%, and today some banks are 26% up … The current economic situation translates into an increased focus on measurability and return on marketing investment.:

I’ll give the final word to Sir Martin Sorrell: “It seems to me that the media are too focused on instant responses, when time will tell.” Thanks Mart.

Haagen Dazs Bees, Uncommon Knowledge, Virtual Goods, Penguin Dating

  • Associating environmental, social, or political causes with brands isn’t just a cheap trend. Done properly, it is also effective: studies say 7 in 10 consumers have purchased a product or service because it supports a cause they believe in.. American Express demonstrated this when it witnessed a 45% increase in credit card applications during its Statue of Liberty restoration campaign. Haagen Dazs chose Bees. Honey bees began dying mysteriously about two years ago. The reason for this hasn’t yet been discovered, but scientists’ failure to correct the situation may yield potentially catastrophic repercussions on the human food supply. Since 30 of its 73 flavors use ingredients that depend on bees for pollination (e.g., almonds, blueberries, peaches), it was considered a highly relevant issue to Häagen Dazs. The firm launched a multi-platform campaign that included TV ads, print ads that flower when planted, a microsite, and philanthropic sponsorships.
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  • From Ace Jet 170: “Designing is basically the practice of combining stuff; ideally in ways that haven’t been seen before. So the more stuff you know (about everything), the greater the chance you’ll find a relevant and distinctive, and therefore effective (and original) combination. The combinations thing goes for everything we do: On one level we combine colours with shapes and typefaces and words, and end up with logos. On another level we take an airmail letter and the idea of love songs and think about love letters, and end up with things like this, despite who the client is.”
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  • In a game like World of Warcraft, some non-devout players often can’t be bothered to put the time & effort into gameplay to gain better weapons and armor for their avatars. So they’ll outsource gameplay to “gold-farmers” to play & advance their avatar. BBC reports that at least 400,000 people in China earn an average of £77 per month selling these virtual goods to players.
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  • PenguinDating.com is a new site by Penguin UK that aims to – you guessed it – help bookworms find love. In partnership with Match.com, Penguin launched the site to introduce a little literary twist to the online dating scene. While sites like GoodReads provide a virtual community for avid book readers, PenguinDating focuses more primarily on dating. Members of the site can search through Match.com’s member profiles to find people who share their literary tastes, as well as find members on PenguinDating through members’ mini-book reports on the latest books they read.
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