In bad economic times, many companies will hide in their office and avoid marketing. To them, there is no reason good enough to spend money on marketing. While customers may stop calling, emailing and buying during a recession… they do not stop listening, watching and looking. Websites are being viewed, newsletters are being read, and direct mail is being opened. You need to look at why you advertise in the first place. You do it to generate more business! When your competitors start withdrawing their marketing budgets and scaling back their advertising costs, you should take every opportunity to pounce! What happens if you cut your budget but your competitors do not? They get your clients!
Let us look at the findings of a few studies completed over many years on this topic:
McGraw-Hill’s Research study of over 600 Businesses stated that “In 1981-1982, businesses that maintained or increased their ad spend averaged higher sales growth during the recession and in the following 3 years. By 1985, sales of the businesses that maintained or increased their ad spend during that recession actually increased sales 256% over those that had cut back on advertising. Aggressive recession advertisers increased market share 2.5 times the average for all businesses in the post-recession.â€
An American Business Press (ABP) and Meldrum & Fewsmith study showed that “sales and profits can be maintained and increased in recession years and [in the years] immediately following by those who are willing to maintain an aggressive marketing posture, while others adopt the philosophy of cutting back on promotional efforts when sales appear to be harder to get.”
The ABP/Meldurm & Fewsmith 1979 study covering 1974/1975 and its post-recession years found that “Companies which did not cut marketing expenditures experienced higher sales and net income during those two years and the two years following than those companies which cut in either or both recession years.”
RESEARCH HAS SHOWN TIME AND TIME AGAIN COMPANIES THAT ADVERTISE CONSISTENTLY, EVEN WHILE IN A RECESSION, HAVE INCREASED PROFIT IN THE LONG RUN.
How do you accomplish this?
1.) Develop messaging that explains how your product is needed during these harsh times.
2.) Build a message of value. Focus on the bang for your buck.
3.) Target the right clients.
4.) Maximize word of mouth and free advertising.
5.) Advertise on the internet, build a web presence, and make sure your website has new innovative content that is SEO friendly.
6.) Develop an email Newsletter, very low cost way to keep your clients informed of new products or specials.
7.) Increase your advertising.
8.) Spend time creating effective ad designs.
9.) Build your brand.
There is no doubt about it. Even though people are afraid to use the word recession, it is out there. With major corporations cutting back and laying off, it makes it even scarier. During this time you can establish a web presence that will stand the test of time, and be there when it is needed. You do not want to be the one trying to build your marketing campaign while everyone else that stayed with it, is now building their client base.
The good news is, this will all come to an end. The economy will turn around, and sales will increase. Keeping a positive attitude is essential! Then ask yourself…. When this turns around where do I want my company to be??
Kimberly Veautour
Acknowledgments:
“How Advertising in Recession Periods Affects Sales,” American Business Press, Inc., 1979
ABP/Meldrum & Fewsmith study, 1979
McGraw-Hill Research Laboratory of Advertising Performance Report 5262 New York: McGraw-Hill, 1986.
Forbes.com
knowledge.wharton.upenn.edu
Tags: advertising, marketing