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Advertising in a down economy

Posted: June 7, 2009 at 6:00 pm

Many business categories have always used brand recognition to their benefits. Recently, a friend of mine was approached by a client who asked: “If branding is working, why am I still down?”

Here is a short anecdote that may answer that question.

Chuck, Chris and Dave were fishing and suddenly Chris noticed an angry grizzly bear across the stream. Chris signaled Dave and they slowly started backing out of the stream. Dave stumbled, spooking the bear, who started charging after Dave and Chris as they ran. On the way through camp, Chris paused to grab his shoes. As hard as they ran, the bear kept gaining on the barefoot fishermen. Finally, Chris stopped running and started putting on his shoes.

“Chris, are you nuts? What about the bear?” exclaimed a frantic Dave. “I just realized something,” Chris replied, “I don’t have to outrun the bear—I just have to outrun you.”

It’s an old joke, but it demonstrates my point. A client may be down for the year, but how are they doing against their competition? I urge that you ask around. The average drop in business among the others you know would be dramatically higher if they’re not marketing. You will lose ground slower than everyone else if you are.

Branding is all about building desire for your product. It has no control over the timing of the purchase. Just because sales are down, it doesn’t mean people don’t want that new ring or new boat or condo. It means they’re waiting for a more appropriate time to buy. The fact that a client is 7%-15% above the industry average means they’ll be getting more sales when the economy turns around. It takes guts and belt tightening to make it through a downturn, but cutting marketing will affect your recovery speed in the long term.

It’s a well-known reality in the marketing world that you grow market share in a down economy and grow sales in an up economy. That’s because many businesses stop marketing when things get lean, and that gives you a greater share of consumer attention. When things turn up again, and they will, you’re already first in line to earn their business. Remember that your business plan lasts through several economical cycles, and your marketing plan should, too.