The fact that the UK is currently in an economic cost of living crisis is no secret. And while the implications of this mean that almost everyone is suffering; brands, consumers, the general public, etc, what does this mean for the Connected TV landscape, if anything?

The rise of Connected TV over the past few years is evident, and although it may be surprising, “consumer worries around cost of living and a greater tendency to stay at home have meant that content such as Connected TV and social media have become more appealing [1] ”. The apparent rise of Connected TV despite the cost of living crisis has meant that there is an increase in brands wanting to advertise their content through CTV as “48% of UK consumers said they used digital content to inform planned purchases more than they did pre-Covid [2] ”.

However, although brands have increasing opportunities to advertise because online shopping and planned purchasing behaviours are at an all-time high; do they need to consider sensitivity when advertising? Should they address the economic crisis within their campaigns?

When it comes to product advertising in times of uncertainty, brands can do one of the following: either address the matter at hand through their campaigns or not say anything about it at all. While the latter may seem like an inconsiderate approach, often addressing the crisis can actually backfire on many advertisers. Due to the cost of living crisis, many brands have already and will need to, increase their prices to keep up with their own potential financing issues, and due to this, brands can “fall into the trap of being seen as hypocritical and lacking empathy [3]”, even though their intention may not be as such. Therefore, it can be argued that not only would this deter consumers from purchasing, but the constant reminder could potentially increase their worries and anxiety levels toward the matter. In this case, “brands are far better off highlighting their quality and reliability in times of uncertainty [4]”.

Revealed through studies conducted in past recessions, certain consumer behaviours have shown that buyers will use “brands as a safe haven [5]” in times of hardship. This means that they will tend to stick to brands that they already know and love, in order to feel a sense of security in times of improbability, despite theoretically having to pay more. They will often budget accordingly and then buy from their favourite brands for “indulgence and respite [6]”. This further strengthens the previous point of why it is more important now than ever, for brands to promote their reliability in the current climate.

Alongside proving that they are trustworthy, brands can also take many other approaches when advertising during the cost of living crisis. Many major brands have opted for providing buyers with discounts, promotions or schemes, which would benefit both them, as well as the consumers. A good example of this would be the Tesco Clubcard which “brings price-driven value to life in an overt way, by lowering prices on specific items and rewarding loyalty [7]”, while also benefiting the brand as it then increases consumption through high levels of traffic.

https://www.hertfordshiremercury.co.uk/news/hertfordshire-news/tesco-clubcard-named-best-reward-7800441

As well as this, it would be both beneficial and fulfilling for brands to do more outside of just their campaigns; “charitable giving, local sponsorships, partnering with wellness brands in adjacent categories, or using their gravitas to influence consumers [8]”.

In light of this, the UK inflation rate has actually fallen by “10.5% in December [9]”. Will this now push a change in behavioural spending trends in consumers?

Saniya Saleem

Sourcing

[1]https://www.campaignlive.co.uk/article/cost-of-living-crisis-drives-stay-at-home-content-demand-relevant-ads/1807892

[2]https://www.campaignlive.co.uk/article/cost-of-living-crisis-drives-stay-at-home-content-demand-relevant-ads/1807892

[3]https://www.marketingweek.com/andrew-tenzer-cost-crisis-say-nothing/

[4]https://www.marketingweek.com/andrew-tenzer-cost-crisis-say-nothing/

[5]https://advertisingweek.com/navigating-the-cost-of-living-crisis-4-ways-brands-can-play-their-part/

[6]https://advertisingweek.com/navigating-the-cost-of-living-crisis-4-ways-brands-can-play-their-part/

[7]https://advertisingweek.com/navigating-the-cost-of-living-crisis-4-ways-brands-can-play-their-part/

[8]https://advertisingweek.com/navigating-the-cost-of-living-crisis-4-ways-brands-can-play-their-part/

[9]https://www.ft.com/content/6cdbacad-be8a-4ea1-be90-a503d8137bd8