Tariffs, Tactics, and Tough Calls: Marketing Strategy in Uncertain Times

[00:00:00] Kelly: economics always works in cycles. We're not always gonna be in a recession or a downturn, things like that. Things will turn around. People will get discretionary income, things will get better, and so are you planting seeds now that will pay dividends down the road that you can afford to do so? And these are the balances you can start to think about and the shifts if you have a really intelligent team that can take those views and make those types of recommendations on your behalf. Hey everyone. Kelly McGuire with IDE Digital. Excited to get into today's topic.

[00:00:52] Todd: Hey, podcast world. This is Todd Kelly's partner, and today we're gonna talk about a hot topic that's buzzing around, which is what's going on with tariffs, how are they affecting brands and consumers and marketers? And, we're sort of right in the middle of it. We've got Some clients that this is potentially having an impact on, and we're trying to figure out how to navigate.

[00:01:15] Todd: So I thought we could talk about this today. More importantly, I think the juxtapositioning of, what happens in times of crisis with marketing budgets. Do they pull back or do you try to take on market share, is sort of what I want to get into. So, you know, everybody's on on edge about this and. I think one of the things we can reflect on, which wanna talk about today is we can use Covid as sort of a not too distant, time in the marketplace where we saw a lot of just craziness with marketing budgets. And so I think, the big question to talk about Kelly today is, I'll pick your brain on, is.

[00:01:52] Todd: When the economy gets shaky, if that's what we wanna call it, or potentially, starts to create some anxiety or, things like that, is it safer for brands to pull back and go dark? Or if you do that and you sort of lose mental shelf space in people's minds that you spent a bunch of money generating over the years, is that potentially worse?

[00:02:14] Todd: Do you look for your competitors that might be doing that? And you go, now I'm gonna eat your lunch because I'm gonna keep my foot on the pedal and the pedal to the metal. we're gonna keep going. So, it's always a knee-jerk reaction in many cases. You know, trim the fat, which is usually the marketing budgets, and I don't know why those are considered the fat, but, maybe we look at marketing budgets more as revenue generators instead of cost centers.

[00:02:35] Todd: But, I think we'll just open up with, What do you think in general about what's going on in terms of what you're hearing clients you've talked to? I know we've got a couple of clients that do have products that are manufactured overseas. They're gonna be impacted by this. We're already hearing about the potential and need to raise prices on products, on things that haven't had price increases and many, many years.

[00:02:56] Todd: And they're worried about what consumers are gonna think about that. Are they still gonna buy? what are the consequences of going quiet? So, What's your overall gut feel and take on what you're seeing and hearing right now?

[00:03:08] Kelly: I really like this as a topic because I think it really forces us to think about the levers that we pull and the considerations we make, and really the nuance in what we. Do when we have to really consider getting more aggressive and more mindful about how we decide to place media, how we prioritize it, how we tap into things.

[00:03:29] Kelly: And it's always interesting, right? If you're in a very open environment, a lot of. Problems can get papered over or you can miss a lot of inefficiencies because things are going well and you can overcome some of those challenges, I think when we enter an environment like what we're potentially facing here, you really have to get buttoned up that's when talent and skill and mindfulness.

[00:03:51] Kelly: I think really has a chance to shine through because all of those things get magnified and amplified and you start to understand what it takes to, be better at the things that we do really well. And what I mean by that is If you're in an open environment and your signals are going well, I kind of liken it back to wild West days of, meta, right?

[00:04:11] Kelly: Where you put a dollar in and you'd get a bunch of money out and you didn't have to be incredibly dialed in, to get positive returns and, there wasn't a lot of scrutiny on things because you're like, Hey, I'm getting huge returns. I'm happy. Maybe they could be a little bit better, but am I gonna.

[00:04:24] Kelly: be overly aggressive about that. you didn't need to be because it was just, it was a shangrila, if you will. Everything that was going well, but now it's like, okay, we have to be really mindful and we have to pull back and we have to look at marketing as a function of business, and we have to make short, medium, and long-term decisions.

[00:04:39] Kelly: And we have to understand, you know, what those are. And I think it's not an answer that I think can be given universally based on industry and product, because I think there's a lot of really existential questions that you have to. Answer before you can start to make the right decisions on how to react in this environment.

[00:04:55] Kelly: And by that I mean you have to think about where you kind of fall on that hierarchy of needs within. your customer base, right? are you a necessity? Are you a luxury good? Are you something that can be delayed? you really have to understand the human experience that you're built your product or your service or whatever it is, your marketing is built to tap into in service.

[00:05:16] Kelly: And I think that's where you need to start to guide some of the decisions that you make, If you're something that's really important and needed, then. You can react very differently than if you're highly luxury, good or discretionary, income based, with lots of alternatives and other ways to solve it.

[00:05:32] Kelly: Right? Entertainment is very different than toilet paper, if you will, right? There's certain things that you have to make decisions differently, but I think that becomes really important because This is how I think great marketing should realistically being, getting done all the time. Again, I think this just forces you to be even better and even tighter on, on, on that because you should be evaluating what are the characteristics of the audience that I'm trying to reach?

[00:05:55] Kelly: What is the value exchange that I can afford to go into? What is the business, the outcomes of my funnel and what I can afford? To invest now and how quickly do I need to realize those returns and nurture it? And those are the types of things that lets you start to decide. What is my cashflow based decisions, the things that are gonna give me immediate sales and immediate returns, what does that look like versus what investments can I afford to make that might not pay off for 12 or 18 or 24 months?

[00:06:21] Kelly: But, you know, it's the whole stock market idea of buy the dip if there's less competition and there's more open space, if there's more attention and you have that dry powder to really put it to use and you have that long-term vision. there's gains and opportunities to be had if you're really smart about it.

[00:06:36] Kelly: So again, it's all these different components that you have to start to tap into and look at and consider. And those are the things that get really exciting because that's what makes people who are great at this able to shine through and bring value and really have that strategy and that initiative that separates from the pack everything that can be done in the marketing world.

[00:06:55] Todd: Yeah, I think there's a reformatting of the comm strategy, right? So when you're thinking about, in media specifically, channel allocations under performers, brand performers, low funnel performers, and also makes me think about in this case, I don't know what your thoughts are on this.

[00:07:12] Todd: In times like this, do you think, or have you seen, or do you have any evidence, I guess, and I'm sure this exists out there, but you may not have this, at the time of this podcast that I'm putting you on the spot asking you, but I wonder, do media prices like CPMs, for example, go down? , if we see a pullback in ad spend.

[00:07:31] Todd: by larger advertisers that can actually move the marketplace costs. I wonder if we'll see some of that coming up where the actual cost of media will go down and we'll benefit from that if we stay vigilant and actually stay optimized and consistent with spend and in the better performing areas.

[00:07:49] Kelly: like everything else, there's not one answer to it, but we're subject to the same economic drivers as almost anything else. And that's supply and demand, if there is a demand, this is why during election cycles and holiday periods and things like that, things get expensive because people want the media.

[00:08:04] Kelly: There's more money at play. You're participating in auctions, you're having to win on data and, and availability and priority of value. And again, we're on a value spectrum like anything else, if lots of people want it, if it's fairly high value, it's really targeted advertising, people are willing to spend more for it.

[00:08:19] Kelly: You have to bid more on the auction and all of that. So yes, it absolutely will impact the auction cost and the availability of media. But there's also another dynamic at play, which is, it can go up or down in terms of the supply. how much are people turning to the internet and digitally driv, digitally advertising driven mediums for entertainment?

[00:08:40] Kelly: Are people not spending more time on expensive, golfing, it's not advertising driven. Are they spending more time watching golf that is advertising driven because there's a cost exchange. So it's human behavior that modeled and dictates some of how that interacts as well. So. There's no straight answer of yes or no.

[00:08:57] Kelly: It will get cheaper. I would say on the whole, the supply tends to go up and the man tends to go down in these types of environments is certainly what we saw in Covid for a degree. Had a lot more people at home streaming movies and TV and things, that they were going through and on their computers all day.

[00:09:12] Kelly: and so the most likely scenario is there will be some cost efficiencies to be had, but that may not be true in every vertical, in every space, in every audience. Again. This is why media buying is not that zero sum game. It's not as simple as things get cheaper, you buy it. Everything should be bespoke to the client and the industry and the opportunity and the product, and the user map and the journey, and all these things that should be part of the planning well before you make the decision on how much money should I be spending and what results should I expect out of it.

[00:09:44] Kelly: And again, it's, putting that magnifying glass. And having to be so much smarter and so much more buttoned up on doing the due diligence of figuring those things out in order to spend these dollars in, trying times.

[00:09:54] Todd: Yeah, I would, think, like you said, just supply and demand. If advertisers pull back, supply's gonna open up, demand will dip, prices will dip. At least on a media efficiency standpoint, I think that's what I would be thinking. we've got some clients in some industries where there. They're very likely gonna get impacted by this.

[00:10:13] Todd: And like I said, some have already started to talk about having to raise their prices. if that's you, if you're the brand manager and you work for product and all of a sudden you're like, oh man, we're finding out our shipping costs and our tariff costs and all this stuff's gonna go up. how do I even continue to sell my product if I gotta raise prices?

[00:10:32] Todd: And. In that moment of that decision, if you're like thinking, okay, my product today sells for $5 and these tariffs go into place, now I've gotta sell my product for seven 50. That's two and a half to 50% increase or whatever, two, $2 and 50% increase. Does that in your mind, tell you, well, now, I've gotta cut costs everywhere else to just make ends meet, or if I've gotta raise.

[00:10:59] Todd: Prices, this is what it would tell me. Now I've gotta do even a better job of communicating the value prop of why, the emotional connection and the value of this product is, is worth paying What you now have to pay for it versus, oh, I've, I've gotta charge this for it, so I'm gonna charge this for it.

[00:11:16] Todd: But in order to like, add to the bottom line because we think sales are gonna dip or PE less people are gonna buy because the prices are gonna rise. I'm gonna take that marketing money and put it to the bottom line instead of spend it. I would think. Curious what you think. If I'm the brand manager and I gotta charge 30% more, 40% more, 50% more for the same product I was selling last week, I'm gonna double down on trying to reiterate my product value prop and why it's still, a good buy.

[00:11:41] Todd: do you think the same?

[00:11:43] Kelly: I love the framework that the question opens up. And again, I'm gonna try and keep it as narrow and not get too broad in my response here, but it allows me to speak about all of the different considerations. 'cause on one side of it, I fully agree with the marketing decisions and I'll come back around 'cause I think that's where I wanna focus the most.

[00:11:57] Kelly: But before I get to that, I have to acknowledge that. My instinct is to preserve the marketing side of things. I understand the business decisions that have to be made first before you can get to that, because well, you may want to be able to immediately maintain or even potentially grow your marketing budgets to take advantage of that opportunity.

[00:12:18] Kelly: Just like if there's a dip in the marketplace and you immediately might wanna buy stocks, you first have to think about paying your mortgage and buying your groceries and paying off your car and things like that. And so from a business perspective, you have to be able to calculate what is the now value of preserving cash flow and cash in the bank and potentially needing more cash flow to buy your raw materials and to to pay for things and, keep Your business operations where they need to be in order for the growth or the preservation of your market. It's this fine balance. So there's a lot of the business decisions that have to be figured out in order to know if you're there. That being said, if and where at all possible, if you do have the margin to be able to figure this out, there is a lot of opportunity, but you have to be real, really smart on how you react on the marketing side of things.

[00:13:04] Kelly: The reality is, is if you have to increase the price of your product. Any amount, but let's just, for the sake of argument, call it 50%. If you have to go from $5 to seven 50, the reality is, is if your entire customer base would've tolerated and continue buying your product. Equally as they do right now at that price increase that would've been your price increase before anyway.

[00:13:25] Kelly: Like you're gonna charge what your customer base is willing to pay. So the reality is, is that is going to alienate some portion of your customer base. And so now the exercise becomes figuring out. What continued portion of your customer base can absorb and can accept that increase and continue to get the proper value exchange of your product or service, it's still worth that amount to them, it does not represent too small or too large of a piece of their discretionary income or their allocation towards this or their overall budget.

[00:13:53] Kelly: Who can take that on and will still think. Yes, it's more expensive. I wish I didn't have to spend more, but I like it. I want it, it fits, and I can afford it, so I'm gonna keep buying it. That's gonna be a subset of what you're used to selling to. Then there's gonna be that other piece that, like you said, for everyone else, you have a choice.

[00:14:10] Kelly: You can either reduce your budget. Or focus more of your budget where you have and capitalize on a greater share of voice on a smaller, narrower focus of audience. Or you can continue to take that audience that you've now lost the imme, the ability to immediately sell to, and you can educate them and now you have to up your value exchange and convince them.

[00:14:27] Kelly: you were willing to buy it at five, you're not as willing to buy it at seven 50. Here's why you still should. Here's why it's worthwhile. Here's how much longer. You have to start to think about the impact on that, and you have to pay to tell that story, right? Marketing is still a storytelling vehicle in which you have a communication exchange with your audience.

[00:14:43] Kelly: And then the last piece that opens up is, again, if you really have a long-term vision and the room to be able to invest in it. There is a chance to start to experiment and open up with new audiences and start to plant that seed and shift to more of a brand or a lifestyle message that sets you up for future success.

[00:15:00] Kelly: economics always works in cycles. We're not always gonna be in a recession or a downturn, things like that. Things will turn around. People will get discretionary income, things will get better, and so are you planting seeds now that will pay dividends down the road that you can afford to do so? And these are the balances you can start to think about and the shifts if you have a really intelligent team that can take those views and make those types of recommendations on your behalf.

[00:15:22] Todd: So here's another thing I was thinking about again, I'm trying to put myself in, and I guess it doesn't matter 'cause we think this way anyway, as if we're the brand manager or the client. . You're in that seat. Let's say you've got a pretty all encompassing full funnel sort of marketing plan, right?

[00:15:41] Todd: You're doing a lot of upper funnel awareness stuff, maybe connected TV or television, linear tv, maybe you're just doing a lot of site sound, emotion, very upper funnel, content driven things, and you've got a really strong mid funnel to sort of nurture, through. Maybe call it email marketing. SMS, you're sort of retargeting.

[00:15:59] Todd: You've got all your good solid tactics in there, and then you've got your bottom of the funnel stuff where you're trying to ask for the order of the sale and, get a lead or a conversion or whatever. Do you feel like in times like this and factor in may factor in maybe the cost of advertising?

[00:16:16] Todd: Maybe they get more efficient because there's a pullback. Are there certain tactics that you think about, that you think become more viable? or there's ones that you just can't afford to cut or ones that you double down on? Like do you, in a time like this, let's say you see I'm trying to paint the picture here of an actual case study example you could talk about, let's say.

[00:16:39] Todd: You see competitive ad spend starting to pull back. Maybe you're looking at that through Google ads or, or whatever, and you're seeing bid pricing and competition pulling back and you're seeing, you know, CPC CPMs going down. Do you, are there certain tactics that you think, gosh, you just gotta double down on and just pour money into to capture that share?

[00:16:58] Todd: Are there certain stages of the funnel or comm strategy areas that you pull back on? Do you go more content and brand and try to. Less of the paid media, but more of the, the more enriched engaged storytelling parts like, I don't know if you've thought about this. I'm curious if you have to think about tactically what sort of tactics sort of come or go or, pull back or invest in during a time like this?

[00:17:23] Kelly: I mean, I keep giving the caveat that it's very unique to each situations, but I'll, try and answer it more universally. again, I think you still follow a very similar or very typical Kind of consideration on prioritization, right? There's the push and the pull messaging, right?

[00:17:38] Kelly: You always want to do pull messaging where it's available to you, and that tends to be search, right? People that are hand raising, people that are actively showing a signal of, I am in the market, I need, I want something, right? And even within that, there's that spectrum of. People that are searching for certain terms that indicate readiness to buy versus people that are just researching versus people that are just generally browsing.

[00:17:57] Kelly: all of that represents a point in a decision cycle that you have to start to make those decisions around. But you still, for the most part, you're gonna want to capitalize on Oh, an immediate need, If I'm searching for something that is a behavior I'm engaging in right now, if you do not.

[00:18:11] Kelly: Pay the money to direct my piece of traffic towards you, and I go somewhere else and I convert. I'm lost forever. You've lost that opportunity. This isn't push messaging where you're trying to convince me this is, I'm ready to act. And you simply have to make sure that you're my last touch of that journey.

[00:18:25] Kelly: Now where you get an opportunity there is if your competitors or your alternatives start to pull back a little bit. You can generate a greater share of voice, and so, especially if you're in an industry with lifetime value, where the idea of sampling or first time experience leads to repeat purchase and brand loyalty and those types of things, there's a chance to get your initial customers.

[00:18:45] Kelly: at a greater degree. And again, once you've gotten that experience with them, they're much more likely, it's a lot easier to nurture an existing customer than it is to get a net new one. So there's an opportunity there. Again, if you can look universally down the road and you have that ability to allocate resources that way.

[00:19:00] Kelly: So I would look at anything where it's like, Hey, if I could get my initial customers. At a little bit greater degree, or if I could direct them and steal them away from my competition or my alternatives, is there a consideration to be had there? but conversely, if you're in an industry, maybe B2B or something where it's a very long consideration cycle, a very high ticket purchase price, I mean, I would hate to be in the space right now of trying to sell new cars with the idea of tariffs and the cost of that and what that looks like in the consideration and whether or not it's better.

[00:19:26] Kelly: So. It's a lot of things where you're trying to think about, again, where do I fit in my customer base's needs and profiles and what, can I think about short term and long term? How much do I wanna pay more to steal from competition? Do I want to develop a platform for future success? Do I just need to be cash flow specific?

[00:19:44] Kelly: But do I need to change? it's even down to, am I saying the same thing on the same search terms that I'm driving, right? What I used to use to convince people to buy my product when maybe it wasn't as painful as a discretionary income decision might be different now than what I need to say and convey to them to convince them differently.

[00:20:03] Kelly: Like you really need to think holistically on what the entire marketing experience is, not just how much am I spending and what platforms I spending. That's an important decision. But who am I reaching? What am I serving to them? What's the user journey? What's the follow up? What's the priority? There's so many decisions that someone should be thinking about on behalf of really any service or industry.

[00:20:22] Todd: Well that's what I was trying to allude to before is in a situation like this, and when you go back to sort of the principles of comm strategy, does the message change, it's conceivable that channels or, things like that could pivot or change in terms of budget allocation based on upper funnel, mid funnel and low lower funnel and where you're trying to optimize just getting the best bang for your buck.

[00:20:44] Todd: maybe you get media efficiency CPMs here and there, or maybe you're like, look, I can't afford top of the funnel. I can only afford to just get, the hand raisers at the, bottom of the funnel. But I'm also questioning. Does the message change? Do you have to, does the consumer deserve or expect the brand to acknowledge that there's challenging times and as a result, hey, we're sorry we have to raise prices, but in order to continue to give you the same great quality product that we know you need, is that the right messaging strategy for.

[00:21:15] Kelly: a slippery slope that's a slippery slope too. Right? We talked about in, different ways. There's instances where you can have that debate and. You can lean into it and there could be some benefit to doing so. You could also face the problem where you assume people are, thinking it's more expensive and hesitant.

[00:21:32] Kelly: Maybe they weren't as much, and the fact that you pointed it out, plants that seed even harder in their mind, and now you've created your own problem. So it's a really fine balance to think through. And again, I, I just think you have to understand what's right for your brand and product, what feels right for it.

[00:21:46] Kelly: And, like anything else, there's opportunities and there's risk to it. And I think understanding the environment. And what it results for some reason it makes me think of, I don't know if it's perfectly relevant, but again, we keep likening this to the Covid times. and I remember a weird experience, I don't know if you recall, like how precious a hand sanitizer became.

[00:22:03] Kelly: It was sold out everywhere and distillery switched over. And I remember this weird experience where I went into like A CVS and they'd just gotten in a shipment like. Five minutes before I went in and there was like one big bottle of it for sale and I was like, can I get that? I remember in the moment being able to realize like I am really excited and aggressively trying to get a bottle of hand sanitizer.

[00:22:23] Kelly: Like it's the hot tickle me Elmo Christmas present I'm like, this is so bizarre. And it's also looking back on it how quickly it dissipated. I think I had that hand sanitizer thing and I used maybe. A 10th of it before it, the market became opened up and got flooded in again, and it was like, just goes to show like any given point in time, things can shift so dramatically.

[00:22:43] Kelly: This is where having an established engine and the ability to analyze and understand how to react and pull back and shift becomes really important. Where it's not set it and forget it, it's not give all my information into a black box for machine learning and let AI and deliver all that stuff is nice.

[00:22:58] Kelly: it's good to optimize and have AI and machine learning. Look at data and be able to make decisions in real times. But it's all in support of actually understanding your marketing and understanding your brand and your brand value and position, and knowing when to make decisions and when to enter in things and make decisions, and then allowing those things to support that and maximize the value.

[00:23:20] Kelly: The whole idea that I hear some people go through that I can just, everything's cheap and AI's gonna fix everything, and none of us are gonna have marketing jobs because ads I'm like. If you're doing things the wrong way, sure that all can replace you it's easy, but you should never be marketing in a way where that's possible because that means you're missing so much of the important things that actually set things apart and go through all of that.

[00:23:42] Kelly: And for some reason it just, it really highlights that. Again, it's stressful to be in the environment that we're in, but I also find it as an opportunity to shine through and actually be able to deliver very differentiated value if you've. Been set up to do so.

[00:23:57] Todd: Yeah, I mean a true point. Alright, so I'm gonna, I'm gonna give you a more specific example and put you on the spot. I won't get too specific, but let's assume. For this case sake, you're the CMO or brand manager of an automotive or, motorcycle company. inventory.

[00:24:15] Todd: And this happened during Covid since you brought it up and you brought up automotive earlier. This happened during Covid where inventory supply constraint became a real thing. You literally couldn't get stuff. so let's say right now, today. You're an automotive dealership network or you're a motorcycle dealership network or some, something like that.

[00:24:33] Todd: 'cause we know that's been talked a lot about, those are products that might get hit really hard, these tariffs. And let's, pretend for this case study example, you're finding out from the OEM, the manufacturer that you're not gonna be able to get supply or very limited supply. Whatever you do get it is going to cost a lot more in that particular category.

[00:24:55] Todd: You're the CMO. You're facing this issue of like, I'm not gonna be able to get stuff and whatever I do get, if I can get it, it's gonna cost a lot more. Now what do you do with your advertising?

[00:25:03] Kelly: It sets me up for another kind of example to use it, but I'll, give the overall example I think about, again, big picture. What does this mean? What do I want? do I want immediate sales and just max it out and take advantage? Do I want to price gouge when I've got the chance to do, I want to nurture customers and think about 5, 10, 20 years from now, what's the opportunity there?

[00:25:24] Todd: You change your messaging, do do you go into a scarcity messaging strategy and

[00:25:27] Kelly: do. So, so this is why the, the reason that I set that up, I had my own experience. This was a, covid experience for me. went to buy a car and I, I had a kid during the same time of covid and I had to upgrade to it to a different car. And I was never in a million years, I wasn't buying a new car kind of person.

[00:25:41] Kelly: It just wasn't where I was at in life. But the whole used car market was crazy. And I ended up doing math and I was like, okay, buying new is really not that much. More savings than used. And so the car that I landed on after doing the research was a very in demand car. You really couldn't get anywhere.

[00:25:55] Kelly: And the problem that I had is everywhere you looked, you were way over sticker price. And not only was I not a person that was comfortable even paying for being the one to absorb the cost of a new car, certainly paying over sticker price was just something that kind of broke my brain in there. And so I looked all over the country, I looked all over these places and called and tried to find anyone.

[00:26:14] Kelly: That would sell, at the very least, at cost. So I wasn't above sticker and would have the availability of the car. And I found a dealership that happened to be relatively local that was, had an allocation of their cars that they would get each month, and they were willing, if you ordered a new one, they would sell it at sticker, but you had to wait, but you could go through it all.

[00:26:33] Kelly: And so I went outta my way. It wasn't the most convenient. I would've never bought from this dealership ever, but they offered something that was convenient to me and I thought was fair and was better than everything else in the environment. And. Then I ended up buying from them and I was a customer I would've never otherwise gotten.

[00:26:48] Kelly: And the reason I tell that story is because that's an opportunity that I will probably buy from them. They got something they wouldn't have because they could have priced gouge like everyone else was, and they didn't, and then they got a reputational thing. There was people that were talking about it online.

[00:27:01] Kelly: That's how I found it. And it's just one small example of making little decisions can change big momentum things on a business you can open up to new customers, you can have a reputation, you can set yourself for those, for that success. So all of that circles back around. If I was a CMO of a dealership that's looking at that, I would really try and set my, do I wanna focus on near, medium or long term?

[00:27:22] Kelly: And I would start to try and map out who has a certain need for certain cars. Do I try and sell my initial inventory and do I use messaging of, you're not gonna mark it up. Well, it's on the lot, but as soon as this lot's gone, it's gonna be, acts more expensive. So now you've created, and not an arbitrary, but a sort of false time constraint or, you know, it's the classic.

[00:27:42] Kelly: Well, supplies last limited act now. Like, but the wait, there's more. Right? these are infomercial cliches because they work. At the end of the day, marketing is a form of playing with human psychology. You're playing around with shifting behaviors and actions from people based on what you're able to tap into the human psyche and what drives us, what motivates us.

[00:28:03] Kelly: there's fear of missing out. There's pulling on heartstrings. there's envy of other people. There's. All the keeping up with the Joneses, there's all these themes and, that we know will drive people's actions and behaviors. And so I would try and understand what my business reality was, what my opportunity is, what matters to me, and what my core values as a business are because just because I can charge more, do I want to, does that, match up with my core values or do I want to be better to my customer?

[00:28:27] Kelly: All of these things play into picking the right combination of things that is the right reaction for a business. And so that's what I would try and understand is. do. I need to make more money now because once this supply goes out, I'm literally gonna lose money for the next six months. So I need to think business-wise, it's not price gouging, it is staying in business so that I can be here in six months so I can service my community.

[00:28:48] Kelly: There's all kinds of reasons why things may or may not have to be done, but I certainly wouldn't make decisions that are just in my own interest and not kind of take that bigger picture.

[00:28:59] Todd: Well, I think we can get close to wrapping up on that sentiment. 'cause I'll add to that. to your note about the scarcity thing, I'm already seeing brands messaging me in email. So I'm in their email database 'cause I bought for them before alluding to pre tariff pricing, get it while it lasts because the next batch of inventory or whatever that's gonna come in is gonna be

[00:29:21] Kelly: again, I get it and I can see that angle, and I'm not suggesting I feel this way, but does that inherently not carry the risk of opportunistic marketing that just doesn't feel right? Like, okay, if you're a brand I care about and I love, like, I love that you're, you're just jumping on the opportunity to maybe stick it to me a little bit.

[00:29:37] Kelly: don't know. I don't know how people would potentially

[00:29:39] Todd: Here's how I can react to it. So one, one of the emails I got is from, it's a wetsuit manufacturer. the company that I buy my wetsuits from and. I looked at that and I was like, well, I am going to need a new one, a new particular type of wetsuit for next winter summer or whatever. So I appreciate the fact that they're telling me, Hey, buy it now because in June when our next shipment comes in, that shipment's more than likely gonna be subject to these new tariffs.

[00:30:07] Todd: You're gonna pay 30% more. So don't wait. I personally actually appreciate the notice because they are giving me a chance to buy something and I probably would've waited until Midsummer or August if it's for wintertime wetsuit, you know, I probably would've waited, but don't know that I'm gonna wait now if they're potentially going to go up 30% because of tariffs.

[00:30:29] Kelly: but you bring up a really good point, right? it's just so analog to Covid, right? Is this creating its own covid problem? Remember what happened? Everyone pulled their sales forward, all the e-commerce, and everyone thought the train was, the ride was gonna be upward forever. And then it flattened out and the world opened up.

[00:30:44] Kelly: And I was like, wait, why are my sales not up 50% over? This wasn't gonna last forever. And then it was a huge, I mean, we're still dealing with a little bit of the outcome of, you know, not expecting the ROAS and the ROIs and the outcomes. And you're like, yeah. I mean, yeah, all you did was just. Pull forward a bunch of your sales from the future.

[00:31:01] Kelly: It it didn't just open up all this consumer behavior that was gonna last forever. It wasn't a gravy train.

[00:31:06] Todd: Dare I say that it is kitschy enough that I could see that actually being a thing in marketing where anytime some sort of macro. Economic geopolitical thing happens, companies do jump on that bandwagon of like get it now before it runs out. And then front load all their sales and like you said, then they're like, well, why doesn't this carry on and repeat itself?

[00:31:26] Todd: Yes. On the other side as a consumer, if it's true and it actually happens, and I am given fair warning and notice to buy something before the tariff price. Hits it. Yeah, I might take advantage of that. It might get me to buy sooner rather than later. And, maybe that's a good thing.

[00:31:41] Todd: Maybe me, I, as a consumer, I do get the product before the tariff price goes up. 'cause what would happen afterwards if I go, nah, I'm gonna wait, and then that tariff price hits and I need that same wetsuit, and now that same wetsuit cost me 30% more. I'm gonna be pissed.

[00:31:55] Kelly: Yeah, I think my overarching answer to the question is, I'm gonna use the same analogy I did, is just like when the stock market goes down tremendously, I always sit and wish, I wish I was sitting in that position. 'cause they say those are the down times are the times to get rich, right? If you can, you can buy and you have the resources and you have the ability.

[00:32:13] Kelly: There's so much opportunity that presents. And so if I was in a position and I had a business in that my reaction would not be to cut every marketing dollar I can and preserve that capital. If I could afford to keep my business in a good place and put as much to work as I possibly can, 'cause there's a ton of opportunity to it.

[00:32:30] Kelly: But I would do it very mindfully, very intelligent. I would look for really strong strategy, really strong thought to it, and I would deploy with a very. Long-term look on what my expectations were that were against that. not everyone's in that position. I can't take advantage of stock market stuff as much as I wish I could, when it comes up.

[00:32:48] Kelly: But I would also not only be capitalistic in that viewpoint either because what is different in that is the deployment of that also has to line up with your brand and your customer experience, right? At some point, if you exploit your customers too much in a certain way, you can create long-term problems because again, we're not just creating sales.

[00:33:08] Kelly: We also have to bring back what we've talked about a lot, which is the brand equity and the brand value and the position you have within consumer minds Also.

[00:33:18] Todd: Well debate. I think where we probably both agree is that. If you're a brand, probably don't want to go dark, you're probably, your competitors will eat your lunch if you go dark. So don't go dark, but you might have to rethink your comm strategy. You might have to rethink channel strategy investments.

[00:33:35] Todd: You might have to rethink ROIs and roas and cash flow things so that you're just doing more of a restructuring of marketing sort of investments and strategies and tactics rather than pulling back just because of panic and fear. and I think, if you're not investing and trying to grow your brand, you're probably not growing.

[00:33:53] Todd: You're probably sitting flat or shrinking, and I don't think anybody wants to do that. So we'll leave it at that. I'll ask you the same last question that I always ask you. Are there any ads that you recall seeing recently that really stood out to you? Anything that you can remember?

[00:34:06] Kelly: Ads

[00:34:08] Todd: I know that's the whole point is think about the fact that we work day in and day out in advertising and yet when we're asked, Hey, can you remember the last ad you saw, blank?

[00:34:19] Kelly: Oh, I know one. I know one that comes up because been listening to, uh. don't know whether this one struck me. I've been listening to a little, it's coming up to the football draft and I like to play fantasy football and stuff like that. So there's some of those podcasts there's this app it's like a phishing booker app or something like that.

[00:34:34] Kelly: it stood out to me 'cause it's the way that they do it and it's very consistent. They use podcasts a lot. that jumped out to me quite a bit as the frequency, which I heard it, and then the uniqueness of like, that's an incredibly niche app. I wonder if it'll last. Um, so.

[00:34:48] Todd: Interesting. Well, summertime's coming and so I'm getting a lot of sunscreen ads 'cause I'm looking at sunscreens because that's the bane of my existence, to figure out what sunscreens are safe anymore because it seems like every sunscreen has got cancer causing agents in it, except for if I just paint my face white with zinc and that's the only thing that I can do.

[00:35:07] Todd: So I get a lot of sunscreen

[00:35:08] Kelly: So sunscreen has the cancer causing agents for a product that's meant to not cause cancer. There's a lot of, lot of circularity there.

[00:35:16] Todd: Oh, they always have. There's so, not to go down this, rabbit hole, but yeah, all the ingredients in most of the just sort of generic sunscreens, not the organic mineral, zinc based sunscreens, pretty much all those ingredients in those have been some way, shape, or form linked to now some sort of cancer causing agents.

[00:35:35] Todd: And so you're like, well, I'm not supposed to eat this, do that, can't wear sunscreen, but I'm supposed to wear sunscreen. So like I don't know what to do

[00:35:41] Kelly: I think everything's just out to get you. make the joke that like, you know, they'd say the air will get you, but there definitely is things where the air quality. Like literally everything has something that tells you it's bad for it.

[00:35:51] Todd: Yeah, but I'm getting a lot of sunscreen ads, so, we'll wrap it up there. tariffs we gotta stay strong. We gotta stay vigilant like

[00:35:58] Kelly: The world's still got a spin economy still has to work. People still have to make decisions.

[00:36:03] Todd: Yeah. And things do go in cycles. Yeah. Things go in cycles. Like you said, we've seen this before. We'll see it again. I don't think there's any reason to panic or knee jerk right now. and we'll see what happens.

[00:36:13] Kelly: Behavior should change Definitely. the other side of it's, you should not just keep doing the same old, same old That's the other side of it is you shouldn't not react at all. Just don't overreact.

[00:36:21] Todd: Yeah. That's why I said I think the reactions can be, I. Varied in terms of what you're focused on. So just don't go dark and pull back and say cut spend and throw that to the bottom line so we can save the p and l. you gotta pivot. You gotta react. Alright, Kelly, thank you. Talk to you next week.

[00:36:36] Kelly: Thanks everyone.