The knee-jerk reaction of most companies when times are tough is to tighten their belts. So, you can see branches shut down, production reduced, and workers retrenched. One of the first to be cut, however, is the marketing budget. On the list of priorities, promotion is at the bottom of the totem pole.
However, should you forego custom marketing materials during an economic slowdown?
The numbers do seem to support the assumption. For instance, according to data, the promotional products industry shrank by 0.6% from 2007 to 2011. Companies were more interested in survival then, rather than poured in money into their marketing campaign. As you may remember, this was during the height of the recession as a result of the housing crash.
The trend is true everywhere. When the company is short on resources, the marketing department is the first to go.
If you follow the same formula, you might be hurting your company in the long-term.
Here are the reasons why you should never cut off your marketing efforts completely even as you endeavour to keep your head above water:
- Keep your existing customers — You can order custom marketing materials but modify the message a little bit to reflect the needs of the times. For instance, you can change the narrative into trigger words like “loyalty,” “family,” “unity.” Like everybody else, you are affected by the economic crunch. But you are still thinking about your customers, and that is why you are reaching out to them when the night seems to be the darkest. Simply put, you need to alter your taglines. Another benefit is that it is more affordable to maintain your existing customers rather than attract new ones.
- Business as usual — During a recession, people are backed into a corner. Their primary impulse is to find their bearings. If you keep an air of “business as usual,” people can take comfort in that fact. When they deal with your company, they would also feel that everything will be alright eventually. Subconsciously, it refers to the psychology of the sinking ship. When you make your customers feel that you are about to fold, do not expect them to come and save you. When they feel your business could not be salvaged, they will abandon you.
- Win over customers from your competitors — The gut reaction of everybody in a recession is to cut the marketing budget, and that includes your competitors. So, if you produce custom marketing materials aimed at their existing customers, you might get them over to your side. And when the economy recovers, their loss is your gain. The strategy is not for the faint-hearted since you need to have a lot of faith that things will get better. Of course, you also need to study the macro-indicators to determine if the hiccups are temporary.
During an economic slowdown, you need to strategize your marketing efforts. Yes, you may need to trim the budget, so you need to be more prudent about your spending. For example, you need to review your expenses and find out which part is giving the least ROI. Forget about your products for a second; the crucial thing is to make sure you remain relevant in your customers’ minds and hearts.