With the economy on a downturn and the “R” word being whispered on 24 hour news programs, many businesses, small and large alike, are thinking of hunkering down and cutting costs.
That’s fine, but you better not touch your advertising budget. If anything, you need to start investing more.
Since the depression of the twenties, market researchers have repeatedly found that companies that cut back on advertising and marketing budgets during economic downtimes ended up losing ground to their competitors, who, by maintaining and even increasing their marketing budgets, overtook their market shares and significantly increased their sales.
For a great summary of these studies you can check out this article by Alf Nucifora.
It makes perfect sense when you think about it: in a slow economy there are fewer buyers spending less money, heightening competition between brands–by cutting back on advertising you’re making your brand even less competitive in a time when it needs to be in top form.
What’s this mean for online marketing in today’s economy? Either invest more, or leave your budget where it’s at. While your competitors cut back, the door is opened for you to stand out, take more attention, and gain marketing ground that, if we study history, will lead to long term growth even after this current economic slump is long over.
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