Fight or flight instincts. Survival of the fittest. When the going gets tough, the tough get going. During rough economic times, there is no doubt that survival instincts kick in. You either have the will to dig your heels in and battle from the trenches or not. Everyone’s fear threshold is different. But those who keep a strong, level-headed focus on the task at hand and don’t panic, usually weather the storm the best.
Just look at the statistics. A McGraw-Hill Research study assessed 600 companies for five years in the 1980s and those companies that either stayed the course or increased their level of advertising spending during the 1981 and 1982 recession had significantly higher sales after the recession ended. Companies that aggressively advertised during the recession had sales more than 250% higher than those who chose not to advertise. Instinct warns us to cut back, slash marketing and advertising budgets and save dollars. However, it’s been proven that continued or increased spending during tough economic times can actually help pull you through and out to the other side positively.
So how do you do it? How do you get over the desire to cut back and actually cut checks instead?
- Acknowledge the situation. Naturally, during a recession, your customers are assessing their budgets as well and are choosing carefully where to spend their money. It’s important to address this fact head on. Acknowledge to your customers that you are aware they have some tough decisions ahead. Then explain to them the benefits of continuing to invest in your services and products.
- Avoid price slashing and doomsday messaging. Negatives like price reductions send off fear signals. There’s a fine line between understanding your customers’ situations and instilling more fear about the times at hand.
- Empower your customers. Create ads, direct mail pieces, blogs, and e-newsletters that empower your customers to take control of their situation and ultimately their destiny. By offering solutions that help them do this, you are creating a positive environment that resonates in a very negative situation.
- Distinguish your value proposition. Communicating to your customers what they will get for their money is just as important, and sometimes more important, than low price points. Even when cash is tight, customers want to know they are getting the best value for their money and many will still be willing to pay a bit more knowing that there is increase value in the products and services you provide.
- Keep your lines of communication open. This means don’t stop marketing and advertising! It is critical to keep your brand top-of-mind with your customers right now so they don’t forget you. If you start to trim corners and cut back, your customers will quickly forget who you are and look elsewhere for what they need. When the recession is finally over, you’ll be left way behind.
- Re-evaluate your marketing mix. If you wrote your marketing plan last summer (or any time before October 2008), you should definitely go back and re-assess where you have allocated your energies. Could you increase your social networking exposure while saving a few dollars in print advertising? Perhaps you could eliminate one direct mail piece and swap it out for an additional three or four e-newsletters? Without drastically cutting your budget, you may be able to shift a few things that will create some savings without reduced exposure to your customers.
Whatever you do, over the next few months as you take stock in your current business situation, don’t take a red pen and slash through each line item in your marketing budget. It’s OK to trim your advertising and marketing budget, but do it with a scalpel, not meat cleaver. Instead, look at creative ways to stay the course and sail through this recession successfully. If you do, chances are, there will be better times ahead.
A dedicated marketing professional, Michelle Kabele has been helping technology companies develop award-winning channel partner programs and marketing strategies for over 10 years. Michelle has worked extensively with small businesses throughout North America.
Michelle has an MBA from the J.L. Kellogg Graduate School of Management (Evanston, Ill.)