Customer service booming in a recession
When the economy starts to creep toward a recession, everyone’s gut instinct is to freeze spending. Marketing is typically the first thing to go. I’ll let you in on a little secret, though. Based on advertising industry history and personal experience, slashing your marketing budget may not be the best strategy to help your company endure the economic downturn. A different approach may not only help you survive the recession, it could provide a major opportunity to come out ahead!
There are two main strategies to apply when advertising-regardless of the economic climate. One is to motivate consumers to fill a product or service need at the time. The second is an ongoing presence campaign designed to build consumer recognition and top-of-mind awareness for your company or product. If customers are not buying right now, you want to be the first one they think of when they are ready to make a purchase in your category.
Many savvy organizations employ a combination of both strategies to accomplish their goals. They are essentially investing in today and tomorrow. If you are one of those smart business owners who have successfully invested in advertising efforts over time and you decide now to pull out or sacrifice frequency and reach to cut costs, you are walking away from the equity built from previous advertising investments.
A better move would be to use the relationships you have built with the media, coupled with their need to maintain their revenues, to negotiate better rates, better placement or additional value added opportunities. Media outlets are concerned about maintaining their share of your expenditures. Most will be willing to work with you to obtain a larger percentage of your buy. What a great way to make your company’s marketing dollars work harder.
Likely, your competitors are going line by line through their budgets to find what they can cut, a respectable method to weather the storm. In many cases, advertising budgets will get slashed. This is a big mistake for them, but a lucky break for you. This provides you a golden opportunity to steal market share from competitors who choose to do little or no advertising. With a less cluttered advertising landscape, it will be easier and less costly to reach consumers with your campaign. Also, with competitors less visible, a creative, consistent advertising message for your business can have dramatically improved effectiveness and increased return on investment.
On the other side of the coin, your competitors may also be wise to this tactic, which means you need to keep your advertising investment stable just to stay competitive. Slashing your marketing budget leaves your market share vulnerable to the competition.
Lili Vianello is President of Visionworks Marketing & Communications, a Columbia-based full service advertising, marketing and public relations firm offering media planning and placement. Contributions to this article were made by Visionworks staff members. Visit them online at www.visionworks.com.