When news of a recession looms, the marketing budget is often one of the first items on the chopping block. For many companies, maintaining or even increasing marketing efforts before and during a recession can yield better results than marketing during economic booms. Here are five reasons to keep your marketing budget strong, even in a downturn.
1. YOU HAVE LESS MARKETING COMPETITION
There will indeed be organizations that cut back on marketing spend during recessions, and this opens up more space for competitors. Marketing dollars can make a bigger impact in a less crowded marketing landscape with less brand noise. Plus, the cost of advertising typically drops during a recession, so marketers can enjoy the budget benefits of lower cost marketing, without reducing their marketing portfolio spend altogether.
2. YOU CAN MAINTAIN MIND SHARE AND BRAND RECOGNITION
The economy ebbs and flows, and companies that see marketing as a longer-term investment rather than a short-term expense may benefit from higher future returns. As one example, after pandemic lockdowns and travel restrictions were lifted, there was pent-up demand for leisure travel. In fact, the U.S. Travel Association reported that travel is at its highest peak since before the pandemic, surpassing 2019 levels (as of October 2022). Companies that stayed top of mind during restricted travel periods had a better chance to capture the demand surge that followed.
3. YOU CAN GAIN NEW MARKET SHARE
Harvard Business Review research on product launch timing found that the best time to launch a new product is right after a recession’s midpoint. Consumers may trim their own personal spending budgets at the beginning of a recession but become eager to start spending on non-necessities and wish list items once the market picks up again. New products can gain first mover advantages over products that take a wait-and-see marketing approach.
4. YOU CAN STRENGTHEN BRAND TRUST
Brands that project an image of stability during uncertain times can gain additional brand trust. Public relations strategies can help an organization communicate authentic stability and develop appropriate messaging for the times. This is true for both B2C and B2B organizations. Firms want to know their B2B vendors and suppliers are on solid footing, and becoming too quiet during a slowdown may spark concern in customers’ minds.
5. YOU CAN GET CREATIVE WITH MARKETING METHODS
Maintaining the marketing budget doesn’t mean all marketing methods should stay the same. Organizations have the opportunity to vary the channels, messages, and methods they use to reach customers. An experienced marketing agency can help assess the best way to stay nimble throughout economic cycles, and use marketing dollars wisely without sacrificing sales or market share.
Reach out to us to help you make the most of your marketing and public relations strategies, even in a recession.