The World: US ads forced to adapt to the idea of 'rightsizing'

With stalwarts such as General Motors opting out of Super Bowl, Ann Cooper reveals a new attitude to advertising in the US.

With US October retail sales the slowest since 1971, car-makers posting huge third-quarter losses and Americans facing the worst recession since the Great Depression, companies across the country are struggling to persuade consumers to buy their goods and services. And they are doing it with a renewed emphasis on cost-savings and value for money.

Procter & Gamble, for example, is focusing on value for a slew of products. Ads for Swiffer mops promise: "Cleans better than a mop and bucket or your money back." Bounty paper towels offers value by touting how the brand absorbs twice as much as competing bargain brands.

A print campaign for the company's Duracell alkaline batteries has the headline: "These are hardly the times to pay for more power than you need." It concludes with this advice: "Don't waste power. Don't waste money." P&G's Cascade and Oil of Olay have similarly launched campaigns designed to persuade the bargain-conscious public that their products are indeed a bargain.

According to a spokesman for P&G: "We are focusing on what value means for our consumers and then letting them know the many ways that P&G brands deliver value. We are continuing to educate, inform and remind consumers of the value inherent in the performance of our brands."

Call it austerity advertising. With a US economy immersed in foreclosures, lay-offs, store closings and dismal sales figures, many advertisers are rethinking their appeal to the consumer. And this is only likely to increase once the holiday shopping season kicks into gear.

"People are shopping less. Clients are looking for ways to perk their interest and make it worth their while to shop again, so value's going to be huge," Joyce King Thomas, the chief creative officer of McCann Erickson, which recently ran an ad for MasterCard offering free hotel stays when using the MC World Card, says.

"MasterCard wanted to make sure they're talking to people in the right way," she explains. "But instead of focusing on the luxury of getting an extra hotel night, they're focusing on the human benefit; ie. more laughs and conversation with your family. It's not about money, it's about the experience. People will probably be willing to spend if you can make it feel like it's attached to an experience, versus, it's just a dress."

Thomas points to a trend called "Brightsiding", which is "consumers trying to put on a happy face by putting a positive spin on the fact they're in a recession," she says. "They're saying, 'This is a good chance to get back to basics and teach my kids good values and not so much consumerism.'"

She also predicts a resurgence of humour in advertising. "People want to laugh, maybe as part of this brightsiding. They don't want to talk about how dire things are. So a few clients want to make sure we have enough humour and fun in the work. I think in the next two to three months, more advertisers are going to lean in that direction. We're all in shock and we have to find the lighter side of things."

It seems just about everyone is trying to divine the future. One yet-to-be-released report from BBDO - which has such value-conscious clients as Bayer HealthCare, Target and Chrysler - examined recent behavioural changes in a cross section of the population in the US and Europe.

According to Tracy Lovatt, the director of behavioural planning at BBDO New York and North America: "We wanted to take a deep dive into current and planned buying behaviours in these challenging economic times. The research underscores how underlying values have been shifting for a while. Even before the current economic meltdown, people were starting to adopt trading behaviour. Recent events have made people hyper-sensitive and they have responded exceptionally fast."

In addition, she says, consumption is much more considered. "People are operating their own checks and balances - consciously trading down where they feel it doesn't really matter (ie. anything perceived as a utility), so that they can trade up or 'invest' where they will get the greatest return on investment," she says.

She points to what she calls the "rightsizing of America" where consumers are simplifying and downsizing their lives. "Consumers are becoming more merchant-like, they're moving things around and taking more control," she says. Back in fashion, Lovatt says, are "layaways", a payment plan in which consumers reserve merchandise by placing a deposit with the retailer until the balance is paid.

But in the meantime, irrespective of whether consumers trade up or down, bright- or rightsize, one thing is certain: advertisers are cutting back their ad budgets. Among the media likely to be hardest hit is local TV. The conclusion of the US election meant the end of the national political ad bonanza for many TV stations, which now have few new business prospects ahead.

Cuts will impact network TV as well, with some advertisers rethinking their Super Bowl ads. With rates for the Super Bowl running as high as $3 million for a 30-second spot, some marketers are wondering whether appearing in the big game during such tough times is the right message to send, and whether they can afford it.

General Motors, for example, which has appeared in 17 previous games, is opting out. FedEx, meanwhile, also a Super Bowl veteran, whose humorous ads usually constitute a highlight of the game, is still pondering its decision. Probably, like the rest of the US, it is holding out for a bargain.