Turmoil in the financial industry, the credit crunch, spikes in unemployment,
disaster in the housing sector, a drop in consumer confidence all have moved
the recession discussion from when to how long.
No one wants the added pressure of marketing in a recession. Typically
the survival playbook is activated, a wait-and-see attitude takes over and,
as we all know, the marketing budget is first to be cut. Yet, marketers
must continue to act in the best interests of their companies. For savvy
companies, a downturn provides opportunities to grab market share by appealing
to prospective customers who are also looking for opportunities to improve their ROI.
Marketing in a recession typically plays out over four scenarios –
with very different outcomes for each:
1. Your top competitor (market leader) continues to market during a downturn
and you do not. You'd better open your survival playbook because the competition
will have its sights set on your customers.
2. You sustain or boost marketing efforts and your top competitor does not. You create new opportunities to steal market share from your competitor(s).
3. You and your top competitor do nothing. The market continues as is with the market leader growing faster than you and continuing to gain market share at your expense.
4. You and your top competitor carry out marketing activities. You gain market share from smaller competitors. Your main competitor grows at a slightly faster rate – but you survive.
Benefits are Measurable. FedEx, People magazine and iPod were all successfully launched in recession years. For decades, studies have demonstrated those that invest during recessions are rewarded. For example, the Harvard Business Review released a study in 1927 saying the biggest sales increases during the 1923 recession were earned by companies who marketed the most. Those results were reinforced almost 50 years later when McGraw-Hill Research found companies that marketed in the 1981-1982 recession saw a 275 percent increase in sales over the following three years.
Win Them with Value. Deciding to continue marketing during a downturn is not enough. You must bring added value to both prospects and customers alike who are scrutinizing costs in all quarters. And watch that strategy of lower pricing, which only begins the slippery slope to more serious problems.
In an economic downturn, your customers need forward-thinking, cost-effective solutions more than ever. Clearly defined, strategically driven communications that address your customers' greatest needs will be welcomed.
Don't Let a Tight Budget Stop You. Budgets get cut. Live with the marketing budget handed to you. Get creative! Reallocate and leverage lower-cost, higher-yield communications to assure a voice before your customers.
Focus on the web:
- Revisit or establish your search engine optimization strategy. Make sure your website is being appropriately spidered by the main search engines.
- Complement SEO with a search engine marketing campaign that will display your ad when relevant keywords are typed into a search engine.
Keep news flowing:
- Find out what's new or innovative in your company and continue to develop editorial opportunities.
- Incorporate your keywords into news release copy and headlines, which will further enhance your search engine rankings.
Maintain thought leadership:
- Research industry events that draw your customers and work with the conference directors to develop speaking opportunities.
- Contribute articles to trade magazines on topics in which your company specializes.
Make sure your current customers are happy:
- Keep your current customers by setting up more face-to-face meetings to detect any reservations about your service before it's too late.
While your competitors head for the bunker, consider the opportunities that marketing in a recession can offer as far as raising your company's profile, awareness and ROI.