During times of uncertainty in a down economy, maintaining business success demands more than hard work. Cautious decision making, intelligent spending and careful budgeting are absolute musts. Decreasing marketing and advertising expenditures may seem like a smart move, but in fact the opposite is true. Yes, you read that right, you should spend more on marketing when the economy tanks, and here's why;
In the long term, increasing marketing efforts in a down market will springboard your business when the economy bounces back. In the short term, it is the solution to many issues that plague businesses in a down economy. It is crucial to understand that consumers do not stop spending money during tough economic times, but they do make purchasing decisions differently.
Some resort to intensive research on products and services before buying, some begin to comparison-shop more diligently, most consumers revise the way they prioritize purchases, but ultimately, consumers will buy items that meet their needs once they decide that they truly need the product or service. This is the audience that should become your main target market at this time. The businesses that will successfully weather the challenging climate of a down economy are those that take advantage of the marketing opportunities created by such climates.
Perhaps the single biggest opportunity presented is an increased availability of market share created during a down economy as competitors pull back from the advertising arena. As more and more competitors give into the temptation to cut most or even all advertising expenditures, thinking it is a practical way to save money, they are creating a huge opportunity for your business to stand out seemingly more loud and proud than before when everybody was fighting attention through the advertising clutter.
Even if you do not increase marketing when others are pulling back or dropping out all together, simply maintaining your regular advertising activities effectively increases advertising visibility and reach. Not to mention that competition for ad space is significantly diminished. More available ad space better positions you in price negotiations often resulting in reduced costs for ad space.
While increasing marketing efforts is probably the single best business investment that can be made during a down economy, there are a few other "rules" that can mean the difference between a profit margin and insolvency. Cultivate and sustain significant relationships at all times. Not just with your customers but also your vendors, suppliers, employees, everyone that interacts with your business on every level. In the end, when factors are comparable, people buy from businesses that they like and trust.
It is a well known fact that maintaining and even increasing business from your existing customers costs far less than cultivating new ones. It will always be wise to develop new customers, it's unequivocally crucial to keep the customers you have. Build customer loyalty by through quality products, excellent service, proactive involvement and sincere interest in your clients and their needs.
Marketing is mistakenly considered an optional expense and is generally the first to be sacrificed to the economic gods. This is a dangerous mindset. Marketing is not an expense. It is an investment. Marketing is an investment in your clients and also in your business. Regular evaluation of expenditures, investments and returns, coupled with routinely assessing objectives will ensure that your business activities are efficient and cost effective in any economy.