Is it wiser for brands to just ignore the cost of living crisis?

Five smart business leaders give us their advice and insight

This might sound like quite the cynical question to pose, but it’s still worth asking when it comes to the marketing industry. Particularly given the inept and inauthentic way many brands seem to approach this issue that many people face. We decided to ask some smart people how they think brands should be approaching this sort of thing.

Gen Kobayashi — Chief Strategy Officer UK & EMEA at Weber Shandwick

Gen Kobayashi

The short answer is no. Successful brands have always had the ability to understand what makes people tick. Because you can’t sell to people without understanding what motivates them. Latest data from the Trussell Trust estimates that 1 in 7 Brits are living in food insecurity and 1 in 5 people using food banks today are in work, but are in low pay and unstable zero hour contracts. These are numbers that are impossible to ignore. In a world where insecurity has become the norm, brands have the opportunity to offer people meaningful value at a personal level. This doesn’t necessarily mean discounting products or saving the world. It could just mean providing you with a moment of levity and joy that helps you escape from the difficulties that life throws at you. Or helping to make you feel a bit more secure or safe. When times are tough people don’t need empty promises from brands that they are ‘on their side’. Instead, they are looking for help in making choices that provide something of value to them in their world. So instead of asking if brands should ignore the cost of living crisis, we should be asking brands what value are you offering to people right now?

Helen Rankin — Executive Director and Astrosociologist at International Space City

Helen Rankin

A brand needs to live its brand values, and be guided by them in their business management practices and communication decisions. If a brand has ever talked about sustainability, then can they ignore the cost of living crisis? Sustainability includes financial inclusion. Many independent agencies in the region wait 6-24 months before they receive payment for their work, but they pay out production fees and people’s wages during that time. It means that the smallest businesses routinely fund some of the world’s largest brands. A brand that lives its purpose is most likely an active member of the community it serves, and would already be working with their audience to support them. For brands who are new to engaging with social problems, a low-risk entry point could be to ask these three questions: Do you pay your agency on time? Are your credit terms 30 days or less? Are you paying your agency a fair rate so they can pay their employees a fair wage? If the answer is yes to these questions, are you encouraging other brands to do the same?

Finnian O’Neill — Business Development Lead at RAPP West

Finnian O’Neill

We know businesses aren’t exactly turning a blind eye to the crisis — soaring prices and stealthy shrinkflation are easy to spot. Just try unwrapping a Toblerone (a personal pet peeve). For a brand to address this conundrum head-on they must possess a genuine reason and, crucially, walk the walk after talking the talk. While skyrocketing production costs (and material shortages) might justify a brand’s confession to ramping prices, customers should never feel like they’re footing the entire bill. Savvy consumers are also calling out brands for using the pricing crisis to make unwarranted hikes. Purpose-led brands are granted more leeway to air their opinions and might even find customers awaiting their response. But make sure any comment is grounded in the broader goals you’ve been supporting — otherwise, is your brand unwittingly losing sight of its ideals?

As ever, profit often takes the driver’s seat. But brands must look beyond short-lived returns and embrace the long game: cultivating priceless brand love through a little empathy and support. Once the financial dust settles, your business will be primed to reap the rewards.

Victoria Gerstman — Semiotician and cultural insight expert

Victoria Gerstman

We’ve been talking about the cost of living crisis for several years, and indeed, the word perma-crisis is already embedded in our vocabulary. For brands to ignore the cost of living crisis would mean blithely ignoring the realities of life for so many people, and that’s not a path to longevity.

This doesn’t mean brands need to be hyper-reactive in their offerings, or that communications should focus on doom and gloom. Instead, in order to ride out this apparent perma-crisis, brands need to be able to make appropriate decisions in the short-term, while keeping an eye on longer-term goals — all the while maintaining a cohesive identity. Life as we know it feels precarious, and consumers are therefore likely to respond well to brands that acknowledge this uncertainty, without abandoning their core offerings.

Annalisa Roy — Fractional CMO at Axel’s Elixir and Brand Strategy Lead Consultant at Speedo

Annalisa Roy

Absolutely not. It is never advisable for brands to ignore the cultural and social circumstances in which the organisation they represent operates. In a financial crisis three things are important:

1. Category knowledge: a real understanding of how the financial crisis is affecting people’s relationship with the specific category the brand operates in. 

2. Brand investment: there is a huge amount of evidence that shows continuing to invest in brand even during socio economic crises is paramount for both short- and long-term business growth.

3. Agile innovation: the ability to innovate quickly enough to make consumers feel that the brand has always something for them and therefore worth paying for even during tough economic times.

Featured image: Ketut Subiyanto / Pexels