Creativity in a cost-of-living crisis

Summer in Britain is coming to an end and winter is on everyone’s mind as we face double-digit inflation, the slowdown of the UK economy and imminent hikes in energy bills. 

A rise in the cost of living - particularly if it leads to a predicted lengthy recession - affects every customer of every brand. At a time like this, what’s the best creative approach for advertisers to take? Is it even right to advertise at all?

At a time like this, what’s the best creative approach for advertisers to take? Is it even right to advertise at all?

My answer is yes. As System1's Chief Innovation Officer Orlando Wood writes in his book, Look Out; “It is brand-building advertising which is the more important and requires the greater investment.” Despite our current obsession with performance marketing, advertising isn’t just about getting consumers to spend their limited money now. It’s also about building brands people like and trust, helping customers in tricky situations and, frankly, also entertaining viewers. After all, the last bout of UK stagflation in the 1970s coincided with one of advertising’s golden ages, an era of Hamlet cigars and Smash Martians, which made the reputations of the creatives who worked through it.

Above: In the 1970s, during the last bout of 'stagflation' UK advertising saw one of its golden ages, with ads like Photobooth, for Hamlet cigars, being made.

But there are still very real risks to brands advertising this winter. One risk is reputational, where the advertising damages the brand because it generates bad publicity, and another is effectiveness, where it isn’t good enough to help the brand grow, so the business wastes money at the worst possible time. 

The most dangerous reputational risk isn’t so much failure to read the room as failure to align your ads with your customer experiences.

Reputational risks grab the headlines - nobody wants to be the brand with a badly judged ad - but the most dangerous reputational risk isn’t so much failure to read the room as failure to align your ads with your customer experiences. Hypocrisy is your biggest threat. Like an ad pledging help for struggling customers which hides a reality of price hikes or dubious deals. More than ever, during a cost-of-living crisis you need to make sure your business is genuinely customer-centric and joined-up. 

In my view, though, it’s the effectiveness risk which is more likely to harm a brand in the long term. From our testing at System1, we know that around half of all video ads (TV and online) score only 1-Star out of 5, meaning people’s reaction to them is negative or neutral and that the creative is very unlikely to help brands grow. In a cost-of-living crisis the last thing you need are ads which eat up your budget only for nobody to notice or care about them. 

Above: The Covid-19 pandemic underscored how brands who acknowledged the pandemic early on were seen in a more positive light.

It's vital for creative work to catch viewers’ attention and combine big, emotional appeal with strong, fluent branding. That means making ads which read the room and get the public mood right while still leaving people feeling positive. 

The best examples come from the Covid-19 pandemic, which turned the world of advertising on its head. What we saw in tests then was that the public really appreciated brands that acknowledged the pandemic early on and offered positive help. For instance, to people in isolation or to frontline health and essential workers. But, by the end of 2020, the mood had shifted and brands who reminded audiences of the pandemic in their holiday ads tended to get a worse reaction than those who kept it in the background and moved back to entertaining audiences. 

Even if you’re centring ads on the cost-of-living crisis, you have to keep brand fluency high - people need to know it’s you.

We learnt that the most important thing to know is what stage of the crisis you are in. Are your audiences going to want reassurance and proof that you’re helping, or are they ready for brands to acknowledge that things are tough, but try to entertain? With the pandemic that was easy because it was happening everywhere at once. With the cost-of-living squeeze it might be that in your sector prices have already risen and plateaued, or it might be that the worst is still to come, and this will have an impact on the tone you take. 

Even if you’re centring ads on the cost-of-living crisis, you have to keep brand fluency high - people need to know it’s you. This was one of the big problems with the wave of very well-meaning pandemic ads; most could have been for anyone! When you’re making an ad, make sure your logo, signature colours, brand characters, distinctive sounds and other assets are centre-stage, even if the content is more serious.