The economy is slow, no doubt. We are all bombarded by the media with stories of Wall Street losses, rising unemployment, and bailouts. My goodness. It’s no wonder many Advertisers want to crawl into a hole and not come out until the economy shows major signs of a turnaround.
So, the big question most Marketers are asking us these days is: do I cut my marketing budgets or not? The answer is simple: absolutely not.
History tells us that the great companies find ways to grow during a slow economy, not shrink. They change their strategy, or even launch a new product or service that is more suitable to consumers when times are tight. Here are some examples:
- Procter and Gamble – During the Great Depression, pushes Ivory soap.
- Intel – In 1990-1991, during economic difficulty, pushed out the campaign “Intel Inside”.
- Wal-Mart – Launches their “Every Day Low Prices” campaign in 2000-2001.
In some cases, buyers are spending more than they were before the economy entered a recession. If your business falls into an high-end luxury category, you may even benefit from increased spending. Customers who can afford these products are more insulated from recessionary concerns.
Still thinking about crawling into that hole? You might re-emerge from your budget-slashing mode only to realize that a competitor has grabbed a portion of your customers. That’s right – you might just save your way out of business. Increasing or maintaining your marketing spending during a recession can increase your share of the market voice. As other players in your industry “chicken out”, they leave the door wide open for you to move in and steal their customers. Keeping budgets where they are may be a risk, but if your voice is heard louder and stronger, you win.
Continuing to advertise in a recession also sends your customers a very clear message about your longevity and strength – an important thing in these uncertain times.
So, focus on spending smarter, but not less. And if you are planning to cut your marketing spending, keep a few things in mind:
- Keep it short-term. – You should think of cutting your marketing budget in a down economy as a very short-term strategy. And, if this course of action is taken, know that you are at risk of your brand emerging weaker and much less profitable.
- Cut unmeasurable marketing first – Your goals are probably the same as all marketers: achieve the highest ROI possible. So, if you have a hunch that you need to cut spending, start with marketing channels that are impossible or difficult to measure.
We propose you think of your marketing budget as and investment and not an expense.