First Deutsche Bank and now Credit Suisse with its report entitled The Power of Brand Investing have recognised AT LAST, that investing in brands is good for business.
It seems that those stocks that have invested in marketing through the recession are seeing improved volume trends, better second-half profits and 2010 forecast up-grades.
The inability of seemingly intelligent people to understand that investing in stimulating demand sells more products than not, has always staggered me. I guess they've always seen the success of Coca Cola as a fluke, whilst Panda Pops were unlucky not to survive the '80's. Just a case of wrong place, wrong time, in the opinion of those clever dudes who spun the wheel and broke our economy!
One friend of mine has resigned his post as marketing director at a VC backed business because 'the bankers' have decreed that no investment in marketing for three years will have no effect on brand equity. Meanwhile a competitor is stealing share whilst the multiples de-list at will.
The solution from our egg-headed friends in stripey suits is of course to cut the workforce, make the product worse (cheaper) and find more costs to take from the business.
Perhaps now one of their own has published the bleedin' obvious perhaps they might recognise that the brand they bought with investors money needs nurturing and building, and then they might actualy get more back. Makes you think doesn't it!