When the Going Gets Tough, Let Marketing Maintain Your Strength
When the economy falls on hard times, the first move of many business owners is to cut back — and one of the most common places to do so is the marketing budget. This is an ill-advised move that will definitely lower your profits.
Maintaining a marketing budget is a decision that could actually save your business while others struggle. If the economy is going to affect your sales either way, it would be a shame to cut marketing and in turn affect customer perception in a way that could harm your image in the long-term, even after the economy has recovered.
The numbers show that this thinking is sound. Businesses that increase their spending on marketing see growth through recession — that is, unless, their competition all increase their spending as well. But even in that case, it would be harmful to cut spending when your competition is marketing more.
While there are changes you can make within your budget and offerings, you should maintain a reasonable budget for your marketing for the following reasons:
Instill Confidence in Your Clients
If your advertising suddenly disappears from the areas where your customers are used to seeing it, they may assume that your business is faltering or even that you have gone out of business. On the flip side, if they see your magazine ad or bus bench as usual, it shows that you are resilient and that you are trucking along as always. This staying power reassures clients and makes it likely that they will continue to bring their business to you.
Instill Confidence in Your Suppliers
Your clients aren’t the only ones who notice whether your marketing has dropped off. Suppliers also need to know that your business is solid and that you intend to make it through the downturn.
Build Staff Morale
When people see their employer cutting their budget in noticeable ways (and employees do notice these things, especially if they’re good employees), they will start to question their job security. Their confidence or lack thereof in the stability of the business ripples out into their interaction with customers. This is especially important to note when it comes to sales staff — they need to be communicating with customers that your business is strong and here to stay.
Of course, your financial worries are valid. It’s fine to be conservative when profits are up in the air. This is the time to look at your marketing metrics and make decisions based on ROI; continue to invest in marketing methods that bring you the greatest returns.
Rather than cutting back, I recommend offering a wider range of offerings. Consider adding lower-cost options that appeal to customers who are experiencing the pinch of the recession; or on the other end of the scale, high-end options for customers who may be left untouched by the slump.
If you’re looking for ways to stretch your marketing dollar and see great returns, call us — we can help!