From Innocent abandoning its Village Fete to Sony Ericsson ditching its sponsorship of Ibiza Rocks, many brands are reappraising their experiential and events strategy in the recession. Marketers used to trade shows in far-flung, exotic locations are also finding that internal and business events are taking place either closer to home, or virtually. While the B2B arena focuses on minimising costs, consumer experiential activity is becoming an increasingly important tool for driving sales on the beleaguered high street.
Julian Pullan, executive vice-president and managing director EMEA at Jack Morton Worldwide, says that in the current climate, many business managers are afraid to be seen spending money.
'In these challenging times, businesses should be looking to communicate with their customers more frequently and more powerfully than ever,' he says. 'History shows that it is those that have the confidence to do so, and the knowledge of how to do so effectively, that succeed.'
Certainly many events and corporate functions are being scaled back, particularly in the financial-services sector. Images of 'bankers on a jolly', whether or not it is part of an existing sponsorship package or an internal conference, are likely to provoke consumers' anger and an irate headline in the Daily Mail. One financial PR advisor says he is actively counselling brands in the public eye, particularly those that have been bailed out by the government, to avoid being seen at any event that could be deemed 'flashy'. Even events and activity linked to existing sponsorship deals, which have already been paid for, should be reconsidered, he adds.
However, many in the industry believe that simply ditching events is a flawed strategy. While a growing number of brands are turning to the virtual world as a cost-effective alternative to staging a full-scale event elsewhere, this cannot be the solution to every problem.
Gemma Newland, managing director of TBWA\Stream, says the difference between a real event and a virtual one should not be underestimated. 'You don't get that shared experience when you are sitting on your own at a computer,' she says. 'Emotion-ally, it's a completely different experience.'
Brands cancelling long-running events or partnership deals, particularly at short notice, can incur significant financial penalties. With knee-jerk reactions to economic conditions, some marketers may be selling their brands short.
Several have taken the recession as an opportunity to reappraise their strategies and invest more in face-to-face activity.
At a time when many brands are focusing solely on maintaining their existing customer base amid the economic downturn, live events and experiential activity can provide a low-cost route to reaching highly-targeted groups and driving both sales and loyalty.
Cameron Day, managing director of Iris Experience, says there has been a huge increase in retail spend. 'There has been a big shift in client spend away from areas with less tangible results,' he adds. The era of brands using events to make consumers feel warm and fuzzy about a brand is over. Events and experiential activity have, in effect, become a direct sales tool.
Claire Stokes, managing director of the Circle Agency, says the recession has driven a sharp increase in the amount of short-term activity taking place. 'Clients need to look at what they are doing and how they can activate sales directly through experiential,' she says.
Many in the industry say the down-turn has made face-to-face communication with consumers more important than ever. 'It creates consumers who will give honest, impartial and positive word-of-mouth for a brand or product,' says Charles Moyle, managing director of experiential event specialist Grass Roots Live.
However, virtual events have also grown in popularity recently, as several trends have combined to make them more attractive, particularly to a B2B and internal audience. Technological advancements in communication, such as Skype, have made videoconferencing both less expensive and more accessible to a broader audience. Second, companies working to reduce their carbon footprints are finding that virtual events are much more eco-friendly. Finally, what is the most important factor for many companies at the moment: a virtual event requires a much smaller outlay than a live one to host.
Yamaha's music division is one business that has embraced virtual events. It ran an 'Expo show', targeting its retail partners, for 10 years. Every September, it transformed its offices into demonstration suites, music studios and a concert venue. However, the expense of the show meant that cuts were needed. Yamaha's solution was 'V-Expo', a three-day online experience, with streaming product demonstrations. DJPR, which created the campaign, sent each dealer a V-Expo goody bag. The total cost was about 10% of the traditional Expo.
However, for most consumers, virtual events do not provide the necessary connection for which brands are aiming.
'When you are looking at digital events, it is important to remember that you are in competition, with both other media channels and everyday distractions, for the consumer's attention,' warns Newland.
Additionally, consumers do not receive the full effect of shared experiences and memories from watching a performance on their laptop as they would a live show.
Meanwhile, in the B2B field, many brands could find that one-on-one interaction with retail and business partners is vital to the growth of their businesses. Despite the cost savings, there is little doubt that relationships and positive experiences are much harder to build online.
Day believes that, rather than ditching live events for digital, the biggest trend in the industry is toward using digital media and social networks to maximise the impact of events. Brands can then follow up and continue their conversation with consumers.
'The role that digital plays within experiential activity has expanded considerably,' he says. 'From a brand point of view, it is no longer good enough to simply brand an event and give consumers a good time.
'We use events as a platform to effectively drive sales,' Day adds. 'The event itself is only one part of the campaign - following it up with digital CRM programmes is equally vital.'
While virtual possibilities are proving to be increasingly popular for B2B events, it seems unlikely that many consumer brands will follow suit. However, maximising the impact of experiential activity through digital CRM programmes ensures that marketers can get the greatest return on their investment.
Live activity is growing in importance for high-street retailers and brands, as the evidence shows that getting out and meeting consumers face-to-face does indeed drive sales. Whether the same relationship can be fostered face-to-screen remains to be seen.
Unilever Sure Girl Fashion Idol
Unilever deodorant brand Sure tasked experiential agency iblink to drive traffic to Superdrug stores and distribute 50,000 samples.
After research into Sure Girl's target audience, the campaign focused on fashion, which was found to be important to young girls. It included a Sure Girl Fashion Idol competition within Superdrug stores. Girls in six major cities were invited to model for pictures in the stores for the chance of winning a professional photo shoot as well as shopping vouchers worth £200.
The competition culminated in a live finale, which included hair and make-up sessions for shoppers.
The winner was selected via social networking site Bebo, and featured in a two-page feature in Superdrug's customer magazine, Dare. The competition also secured coverage in regional press titles. According to iblink, the campaign reached 1.6m consumers.
Lavazza A Modo Mio
Lavazza asked Iris to devise a campaign to drive sales of its A Modo Mio home coffee system in the run-up to Christmas. The agency targeted key events, including the London Fashion Week-end, the Spirit of Christmas Fair and the BBC Good Food Show, to reach a broad target audience.
Staff were on hand at each venue to demonstrate the machines and serve coffee samples to consumers. They also promoted a competition offering the chance to win a trip to Italy. The brand also had a significant presence at trade shows and demonstrations in Selfridges, Fenwicks, House of Fraser and selected Tesco Stores.
The campaign included a total of almost 15,000 demonstrations and 10,960 samples. The experiential activity also generated 129 sales to consumers on-site.