SociaLight Media Blog

It’s everywhere - investors, co-workers, family, and friends yelling “Recession!” from the rooftops.  Yes, America is in a recession.  By definition a recession is two consecutive quarters of decreasing GDP, and we’ve had nine of them since World War II (not including the Great Depression).  If we’re experiencing these troubled times roughly once every six years, shouldn’t we be used to them by now? Shouldn’t we know how to handle them?  Some businesses do - those who realize that growth occurs during recessions, and, if they capitalize on that fact, they come out much better than they were at the onset.

It’s true that the proverbial corporate belt buckle needs tightening during harsh economic times, but to look immediately at cutting your advertising and marketing budget would be a big mistake.  Consider boosting efficiency, adjusting operating hours, reducing overhead, and streamlining production and operation, which are all much more beneficial for most companies than biting the hand that feeds you: your ad spending (the thing that drives all of your sales…).  In this economic climate, online ad spending is especially important because it’s so targeted and efficient, and competition is less fierce than in conventional media.

In a basic marketing class, you learn that your advertising budget gets you a piece of the pie in the consumer environment - there are many companies putting a lot of money into grabbing a hold of the customer’s attention.  During a recession, when many companies pull back their advertising, this increases your voice and the effect of your ad money; and if you increase your ad budget, it gives you an even more powerful voice.

“History also reveals that businesses that recognized the fact that growth does occur during recessions and took advantage of it, were able to make gains in their market share despite economic hard times. With media rates softening and competitors sitting tight and cutting their marketing budgets, an aggressive business can experience great strides in a recession.” -Articles in the Spokane Journal of Business

Additionally, the National Retail Federation projects that overall retail sales are expected to grow 2.2% as the holidays approach, as compared to the 12% projected for online growth.  Mr. Silverman, of Deliotte’s annual holiday survey, advises that “Retailers should be viewing [online investments] as a way to capture lost sales and prevent them from going to a competitor.  I’m not going to say the growth in online is all additive — a lot of it is shift. However, if you haven’t been investing in your online store, that shift may not go to you, it may go to a competitor.”

I’ve added a couple additional notes to Ed Clark’s basic tips for small- to medium-sized businesses during recessionary times:

1. Don’t cut your ad budget; increase it. Let your competitors cut ad spending (and their market share).
2. Shift some ad spending from conventional to online - especially approaching the holiday season.
3. Your customers are nervous about spending; adjust your marketing campaign to assuage them.
4. Develop your web presence quickly - if you sell a product online, try to offer free shipping.
5. Lower rates and ad promos from hurting conventional media companies provide great opportunity.
6. Build brand awareness by sponsoring events - this is relatively cheap and definitely effective.
7. Promote online; sponsored events (above) are extremely easy to promote online through social media.
8. Know who your loyal customers are and let them know what you have to offer.
9. Step up public relations efforts. Developing your offline presence is still just as important.
10. Don’t “cheapen” your advertising by trying to save on creative or production costs. Your customers will notice and worry about quality. This is a time to stress quality and value.

What are some steps the company you own or work for is taking during this difficult economic climate? What are some steps you are taking as a consumer?