5 Tips For Recession Marketing

deathWith the current state of the economy, many companies are bracing for the worst and are adjusting their expenditures accordingly. Typically, the first casualty is the marketing budget. While common sense is what CEOs and CMOs cite as their reasoning for a reduction in advertising and marketing (less share of wallet available from consumers), prevailing research supports just the opposite. In fact, studies show that a recession is the ideal time to increase marketing budgets and augment market share and sales versus competitors.

A McGraw Hill/American Business Press research study of business practices during the 1981-82 recession reveals that companies that maintained or increased their marketing and advertising spend during the recession experienced an average of 256% higher sales than their competitors who reduced their marketing over the same period. What is really telling about this research is that the sales figures quoted stayed constant for three years after the recession had ended.

A similar study conducted over same period by research firm Meldrum & Fewsmith concludes that aggressive advertising did not only grow revenues; it even increased profits.

In 2001, a study comparing marketing practices during the 2001 recession determines that aggressive recession advertisers increased market share 2 ½ times the average compared to all businesses in the post-recession.

Why?

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5 Tips For Recession Marketing

Authenticity over spin

During a recession, one of the most important things advertisers can do is to amend their messaging to reflect the current economic situation. Consumers are no longer brimming with confidence and discretionary cash to spend, and the same offer-driven messaging that worked during an economic boom will likely not resonate. Worse yet, if you don’t alter your messaging, you’ll risk alienating your customers and potential customers because you’ll seem out of touch. For example, I just saw an ad where the subhead was Now is the best time to buy! for a car company. Really? NOW is the best time? “Best time for who, me or you?”.

In my opinion, authenticity is what will sell right now, not spin. Don’t ignore the fact that there is a recession. Embrace it, and empathize with your audience. One company that’s doing a good job of it right now is Sprint. Check out their latest television commercials featuring CEO Dan Hesse. No spin, just facts.