Many businesses have never faced the level of uncertainty they are confronted with now during the global pandemic. Some are experiencing declining revenue and are beginning to institute cost-cutting measures, including reducing their advertising and marketing spending.
In the wake of the last recession in 2008, ad spending dropped 13 percent, as reported in Forbes.
But history shows that cutting back on marketing during challenging times can be a risky move, leading to depressed results over a longer period of time.
The Advertising Specialty Institute compiled a century’s worth of data about the benefits of continuing to market and advertise during a recession.
One example: McGraw-Hill Research analyzed 600 B2B companies from 1980 through 1985. Their research found that business-to-business firms that maintained or increased advertising expenditures during the 1981-1982 recession averaged significantly higher sales growth, both during the recession and for the following three years, than those that eliminated or decreased advertising.
Why Maintain Marketing Momentum?
Discretionary spending such as advertising and marketing may be easy targets for CFO’s attempting cost control, but executives should look first to reduce other operating expenses. Maintaining marketing momentum during this time has numerous advantages:
- With some companies cutting back, there is less competition for your audience’s attention, and therefore getting noticed becomes easier.
- You may be able to gain market share from competitors who don’t maintain their marketing presence.
- The cost of advertising space can be lower as demand for inventory decreases.
- By maintaining a marketing presence, you can project a company image of stability and strength. No one wants to do business with a company that is perceived to be struggling.
- You can stay top of mind with your customers and prospects.
- If you let campaigns languish, and your customers’ buy cycle is long, you may continue to struggle even when conditions are more favorable because the top of your sales funnel will be empty.
- Currently, there is a huge surge in internet traffic with many people working remotely, helping to expand the potential audience for your digital presence.
Continue Marketing, but Make Changes
While the arguments are strong to continue advertising and marketing during economic downturns and other challenging times, you may not want to do exactly what you have been doing in the past.
- Check your messaging and revise as needed. Make sure that all content you share with your audience at this time is relevant, authentic, and sensitive to what your customers might be going through. Also, if customers must interact with your company in a different way now, be sure to communicate that clearly.
- Reposition products and services. If your product and service offerings are in any way related to providing assistance during the current crisis, you can do some repositioning. Testing equipment, protective material, products that increase efficiency, or a service that benefits a remote workforce—these are just a few examples of areas that might be ripe for repositioning. Make sure your messaging reads as being helpful rather than as taking advantage of the situation.
- Share good news. Maybe your company is performing some type of community service to help others afflicted by the coronavirus, or you have employees who are volunteering their time for the cause. Highlight these cases in your next newsletter, or even publish a special edition. We could all use some positive news.
- Justify your marketing budget. When potential cutbacks loom, you may be asked to defend your budget. Make sure you are prepared. Track your marketing metrics and produce reports to demonstrate to executives that your marketing programs are working—and prepare your talking points on the detrimental effects of pulling back on marketing.
This infographic—“8 Talking Points to Justify Your Content Budgets and Projects During COVID-19”— from MarketingProfs, is an excellent complimentary resource to share with key stakeholders in your company.