During economic downturns, whether a bear market or even a recession, you understandably have to cut costs to keep your business running. But you need to be careful not to make short term sacrifices that ultimately harm your business over the long term.
Marketing can be tempting to put on the temporary chopping block. During the Great Recession of 2008, for example, advertising spending dropped 13% in the United States. Here, we make a case as to why it’s worth the investment to ensure your business not only survives but comes out stronger.
Note: We discuss in a separate post how investing in branding can help your business stay strong through an economic downturn.
Why You Should Keep Marketing
In the 1920s, Post and Kellogg were duking it out as the top two dry-cereal brands. When the Great Depression hit, Post cut way back on advertising. Kellogg did the opposite, doubling their ad spending and introducing a new product called Rice Krispies. By 1933, still in the early years of the Depression, Kellogg’s profits were up nearly 30 percent, making them the industry’s clear frontrunner.
There’s a lot competing for our attention. Reminding your customer base that you exist is crucial, especially as they start paying closer attention to where they’re spending their money. Why would you stop doing the thing that keeps your business top of mind?
Another reason to keep marketing is that it helps maintain consumer confidence in your brand. If your business is noticeably absent from the advertising landscape, that silence sends a message that your company is on shaky ground. Consumers will become less likely to trust their dollars with you, creating a self-fulfilling prophecy.
Of course, haphazardly throwing money at advertising during a recession is not a smart move. This is the time to dive deep into your current marketing and advertising tactics and examine each one’s return on investment. Make cuts wherever it makes sense to do so, but whatever you do, don’t ditch the entire budget.
At the very least, remember that advertising costs will be lower—take advantage of that. If you don’t, you better believe one or more of your competitors will.
Need more marketing and advertising advice? Check out our Brand Outlaw podcast and YouTube videos.
Is weak brand messaging holding you back from creating effective ads during tough economic times? Contact Superkick Branding for a free consultation.