When businesses go through lean times, owners and leaders often trim or even eliminate the marketing budget and activities. While understandable, research has shown that there are benefits to advertising during a recension or downturn. In fact, a report from the Harvard Business Review showed that when brands increase marketing during an economic downturn, especially when their competitors are decreasing their own marketing, companies can boost their market share and ROI.
Keeping your marketing in force is a decision that could save your business while others in your vertical struggle. If the economy is going to affect your sales no matter what, why not keep your company’s name and brand out in front of potential customers?
Although there are changes you can make to your marketing budget and activities, you should maintain a budget for your marketing for the following reasons:
1. Build confidence with your clients and customers
If your marketing activities were fairly consistent and frequent, greatly decreasing or turning them off during a downturn may cause your clients and customers to wonder if you’re in deep trouble and will be unable to provide your products and services in the near future. Staying the course, albeit at perhaps at a lower level, will show that you are resilient and staying positive.
Consider this quote about advertising in a recession. When Sam Walton, the founder of Wal-Mart, was asked, “What do you think about a recession?” he responded: “I thought about it and decided not to participate.”
2. Build market share while your competitors pull back
If your competitors decrease their own ad spend or marketing activities, this can be a good time to increase your share of the market and voice. With fewer ads/posts/mailers vying for attention, your efforts will stand out more. If your marketing was not particularly strong before the downturn, creating an organized marketing calendar with an eye toward activities that get the best ROI is a smart approach.
3. Build confidence with your team
When your employees see you panic by cutting back on advertising, it is natural to question job security. Teams that feel like their business is going out of business become less effective and also can communicate a lack of morale to interactions with customers. This is especially important when it comes to sales staff because they need to be able to communicate with customers that your business is here to stay.
Your financial worries are valid and it is understandable to be conservative when sales are slow. Take a hard look at your marketing metrics and make decisions based on ROI and visibility to your customers and prospects, but do everything in your power to keep from eliminating your marketing budget. Consider teaming up with a local non-profit organization to create an event that can bring visibility (and spread goodwill) to both organizations. Ask your local government if they have marketing grants. Check with a community college or university about their intern program to find a marketing intern. Who knows? You may even adopt some fresh, new marketing ideas.