Brexit is looming, due to finally happen! Leaving the EU has already started to and will create further significant waves of change across the UK.
You’d think with over three years to plan and sort out our future, we’d be in a good position when we leave, but we still don’t really know what’s happening.
What impact will Brexit have on brands and advertisers?
The uncertainty surrounding Brexit is already having massive financial implications, with many individuals and big brands holding back on spending. We all know that marketing is often the first budget cut. With the current frugal approach to business, the desire to invest in promotion, especially when it comes to larger campaigns, is waning and agencies and marketing departments alike have begun to feel the hit.
Brands' fear of spending isn’t unfounded, as they themselves are likely to experience a cut in sales. Brexit has scared us as individuals into being more conservative with our funds, therefore those who sell products at a high-end, or even middle-range price are particularly likely to be affected by a drop in consumption. The entertainment industry is also likely to feel the hit, with consumers less likely to splash out on nights at the cinema or theatre.
But it’s not just consumer focused industries who will experience financial shifts. Business to business (B2B) focused industries will also be affected. The agricultural industry in particular is a good example; businesses throughout the supply chain will have to adapt to new demands inside the UK which might increase income and restrictions on exports to the EU which could decrease it.
However, despite all the doom and gloom caused by the uncertainty of Brexit, there are also exciting opportunities for advertisers and brands coming to light.
What opportunities will Brexit create for brands and advertisers?
- Open market share
The most obvious and possibly the most lucrative is that with so many companies looking to cut back spending on advertising across the majority of sectors, their market share is open for the taking. This offers a brilliant chance to help brands get noticed and front of mind for their target audiences, while those who are too nervous to spend will shy away and lose out.
Using an extreme example, say Tesco or Sainsburys stop promoting awareness of their brand. Other supermarkets such as Aldi or Lidl, who are already becoming more mainstream, would be perfectly positioned to take advantage. By increasing their advertising spend they could raise visibility and create trust at a time when consumers are lost and looking for brands they can put their faith in.
- Price differentiation
Advertisers can work with brands to turn the lack of consumer spending to their advantage, by positioning themselves as cost effective or focused on helping their target audience to save money. For example, cinema brands can capitalise by showcasing themselves as a cheaper, yet still brilliant, alternative to more costly nights such as the theatre.
On the other hand, brands who do have higher-end products and can’t drop price-points could position themselves as a special luxury during points of the year that consumers might want to treat themselves, for example on payday or at Christmas. It’s all about how they appear and appeal to the consumer.
- Talking about Brexit
Directly referring to Brexit and tailoring creatives/copy in ads around the controversial subject could have a constructive impact and a number of brands this year have trialled this with positive effects. Some like Marmite with their ‘Hard breakfast? Soft breakfast? No Breakfast?’ slogan have gone down a comical route, a clever strategy at a time when the public are angry and confused; humour is vital to cultivating brand love and loyalty.
Others, like HSBC with their ‘we are not an island’ campaign have taken a more sensitive tone, another intelligent strategy to build faith when people are feeling exceptionally disheartened.
By addressing Brexit in a way that is tailored to their consumers fears or expectations, brands focused on a UK target audience have the ability to immediately connect with their key audiences and encourage the actions they want.
Brexit may be an overwhelmingly complex and terrifying event on the horizon, however, there is definitely the opportunity to create positives. Brands and agencies need to be brave, bold and take advantage of what is looming and whatever it may entail. Spend more, don’t shy away.
Jack Young, campaign executive, Altair Media