Advertisers ponder how to cut costs while holding appeal for consumers

Reduced marketing budgets will force advertisers to go back to basics in the coming year with a focus on fewer and bigger brands and on mainstream media. In the face of uncertain consumer confidence and the downturn in the economy, there is, according to Mr Michael Caraher, chief executive of the Association of Advertisers in Ireland, a back-to-basics thinking among advertisers.

At a Marketing Society seminar this week, he predicted there would be a new mood of accountability for any money spent on advertising with an "if we can't evaluate it, we can't do it" philosophy governing advertising spend.

To boost consumer confidence he suggests that, at a time when marketing budgets are under pressure, marketing professionals should set achievable goals and be ready to respond quickly to consumer demand and market conditions.

If Mr Caraher's prediction on how budgets will be managed during 2002 come true, commercial media including newspaper, broadcast and outdoor media are in for another uncertain year. He said advertisers would adopt a wait-and-see approach to committing budgets and would ringfence outlay, with many committing only 40-50 per cent of expenditure until they assess sales results after the first quarter.

The focus on mainstream media, which is usual in a recession, is not necessarily good news for those chosen media, as advertisers are now flexing their muscles after the boom years when media called the shots in terms of space availability and price.

"There is now a change in the balance of power in favour of the buyer," said Mr Caraher. "Deals can now be done." Already, at least one Irish advertiser, Eircom, is following the lead of the multinationals and demanding highly favourable media deals - in some cases at 50 per cent of the rate card rates.

Despite lay-offs in some advertising agencies, there is a bullish mood in the industry. "You have to see the downturn in advertising spend in the context of the extraordinary years we have just had," said Mr Chris Cawley, president of the Institute of Advertising Practitioners in Ireland.

"If you take IT recruitment and property advertising out of the equation you get a clearer view of the advertising industry and the fundamentals are still good."

IN OTHER markets, the recession in advertising is prompting more than a positive attitude. In the UK this week, Metro, a freesheet aimed at commuters, took out a double-page spread in other newspapers advertising for advertisers. Under the single line heading "Out of sight, out of mind" it suggested that advertisers failing to advertise during a recession do their business irreparable damage.

The copy directed readers to websites with examples of products which were either launched or had thrived in the last advertising recession in 1991 by advertising aggressively - most notably Barclaycard and Renault, which introduced its new Clio with the famous Nicole/Papa campaign.

In Brazil, the association of advertising agencies is going directly to consumers with a $19 million (€21 million) promotion asking people to nominate their favourite brand. The slogan - "There are no great companies without great brands. Advertise" - couldn't be clearer.

bharrison@irish-times.ie