Are you concerned about inflation and the slowdown in our economy? Are you thinking about pulling back from marketing? Unfortunately, during bad economic times. most business leaders do. But don't fall for the fallacy of preserving funds to remain profitable. Marketing during a recession is critical to keep your business vital and strong.
In this blog, we’ll explore the reasons why you need to continue to market during a recession.
Table of Contents
- Don’t Get Emotional – Recessions are Temporary
- Stay Vital & Come Out of the Recession Strong
- What’s It All Mean
- Related Resources
- Need More Help?
Don’t Get Emotional - Recessions are Temporary
In 2008, I owned a small video production business, creating marketing programs for clients. When the Great Recession took hold in the early part of the year, I lost every project I was working on within a two-week period. Each of my clients called saying with the tough economy, they didn’t think they should continue to spend on marketing.
I’ve never forgotten that. Each of them was scared. They were afraid their businesses would not survive and thought they needed to preserve funds to stay profitable. Instead of continuing to market, they chose to do nothing.
What each of my clients didn’t realize is that by choosing to sit out and hold onto their marketing investment, they were actually hurting their businesses, not preserving them.
Recessions are Not Permanent
Even though they are scary to go through, recessions are not permanent. They are temporary. In fact, according to Nielsen.com, 75% of all U.S. recessions only last a year. Additionally, 30% end within two quarters. Even the Great Recession only lasted 19 months.
What’s even more interesting is that most business owners understand this fact. Yet when tough economic times come, they choose to freeze their marketing budget and sit on the sidelines. This is a fear-based reaction to the economic conditions and fear is not how you should run your business.
Instead, develop a marketing plan that takes advantage of the market conditions brought on by the recessions and keep marketing. It will help your business be vital during this difficult time. The result will be rewarding. Your business will come out of the bad economy stronger than before.
Stay Vital & Come Out of the Recession Strong
It’s a sad fact, but it is true: Small businesses are more susceptible to bad economies than large corporations. They simply don’t have the financial cushion to get through the rigors of a recession compared to larger companies.
The Toll of the Great Recession
A 2011 study by the National Bureau of Economic Research found that during the Great Recession, 27% of small businesses ceased to exist. So you need to take every action possible to ensure that your business survives. That includes continuing to invest in marketing. It is a wise and savvy business decision that ensures your small business stays vital.
The Power of Marketing
In fact, a recent study by McGraw-Hill Research shows that businesses that invested in marketing during 2008 and 2009 actually came out of the recession stronger than those companies that reduced or halted their marketing. The conclusion from the report is this: “Businesses that reduce media expenditures suffer loss of market share…aggressive businesses can accomplish these gains through greater expenditures without reducing short-term profitability.”
In other words, by staying on the sideline during a bad economy, you are more or less admitting defeat, as well as ensuring it. Your commitment to marketing means you will continue to be in front of your prospects when they need what you do and your chances of winning that business are greatly enhanced over those who remain out of the game.
A Boost in Perception
Investing in marketing during tough economic times also boosts the perception of your business. Because you continue to be “out there,” your prospects will perceive you to be a solid and stable company. One that is not impacted by the recession. This belief by your prospects gives you a competitive edge over your competition. You’ll be winning customers while they sit and watch.
Finally, at some point during the recession, your prospects will still need what you do. If you aren’t marketing and as a result they don’t see you, they will go with one of your competitors who is.
What’s It All Mean?
Pulling back your marketing budget is not a smart decision. Business leaders who do that are weakening their company’s position in the market and allowing others to take the advantage and occupy the higher ground.
The rule here is simple: Spend less, get less of the market share. Spend more, get more of the market share.
In the end, once the recession is a memory, those businesses that continued to invest in marketing will be stronger and more vital than those that did not.
There’s a popular saying in business that continues to be true: “When times are good, you should advertise. When times are bad, you must advertise.”
Related Resources
Optimizing Your Google Business Profile Posts for Engagement and Conversions
What Kinds of Businesses Need Local SEO the Most?
10 Digital Marketing Stats for Local Businesses in 2024
Need More Help?
Need help understanding how to move your Cincinnati business forward during a recession? Just contact Signal Digital Marketing at 513-237-5530 for a free, no-obligation conversation.
You can also learn more about our Local SEO, Website SEO, Social Media and Content Creation services at our blog.