No doubt, it is a tough sell to push for more advertising and marketing dollars when most companies are facing slow economic conditions. Let’s look at some historical research to support your contrarian plan.
In a study of U.S. recessions, McGraw-Hill Research analyzed 600 companies from 1980-1985. The results showed that business-to-business firms that maintained or increased their advertising expenditures during the 1981-1982 recession, averaged significantly higher sales growth, both during the recession and for the following three years, than those that eliminated or decreased advertising.
By 1985, sales of companies that were aggressive recession advertisers had risen 256% over those that didn't keep up their advertising.
Another series of studies done by Meldrum & Fewsmith along with the America Business Media, came to the same conclusion when in their report they stated, “History has proven companies that maintain or increase their advertising investments in periods of economic downturns increase their sales and share of market, both during and after the downturn.” You can read a summary of the results here.
My friend and fellow-member of the B2BSIG of AMA Houston, Michelle Reed, Principal at STANandLOU Marketing//Advertising had also cited the same studies during her incredible presentation earlier this year.
More recently, Nancy Costopulos, the chief marketing officer of the American Marketing Association has written an article titled “Marketing in an Economic Downturn” (published in the July 2008 issue of Marketing Watchdog Journal, a monthly newsletter from Bulldog Solutions). In it, she cites a survey where she states, “Our community told us the biggest mistake marketers can make is halting or reducing spending on key marketing programs.” For more results from the American Marketing Association survey, request an executive summary.
Nancy suggested four tactics to market successfully during recession. They are:
- Shape Your Message
- Focus on Who NOT to Target
- Innovation Is Key
- Sustain the Brand
What are you doing to weather the storm?