Marketing Strategies for Tough Times

Are we or aren’t we in a recession? If we are in a recession, should you cancel your marketing plans, batten down the hatches and ride it out? Or should you beef up your promotional efforts and try to generate as much business as possible? These are questions companies have been asking now and for decades.

Some economists seem to be almost certain that we are in a recession, while others think the economy will improve next year. “Technically, we have not met the government’s definition of a recession,” said Ken Ardisson, business manager, Arcadia Biosciences. “While we may get back to a more balanced and viable state soon, it will take time and more economic stabilization for business to reverse the current downsizing trend.”

If the so-called recession continues, or if corporate management executives believe a recession is upon us, many may cut their advertising and promotional budgets yet again, as part of what they feel are a series of cautious moves. Their reasoning is a recession will mean lower sales and net income. They believe cutbacks in discretionary expenses such as advertising can be easily made and seen as it relates to the bottom line.

“It has been my experience that our business has actually been as strong or stronger during U.S. recessionary times,” said Cam Kupper, North American vice president of sales for Canadian-based Bioriginal Food & Science Corp. “In the last two quarters, we have had similar marketing/sales promotion that we have had in past years, and we expect to continue.”

Maintaining corporate and product brand recognition should be considered an ongoing business investment. The moment it stops, it begins to lose power immediately, and future sales are in jeopardy. Studies have shown it takes four to six months to see the results of an advertising program. Cutting back during a downturn is like throwing away that investment. Maintenance today costs much less than rebuilding tomorrow.

Before making any cutbacks, corporate leaders need to ask themselves:

• What does advertising do for the company and similar objectives be achieved with smaller budgets?
• What happened to companies that have cut their advertising and marketing budgets during a recession, as opposed to those that have maintained or increased their budgets?
• Can a recession be used to gain an advantage on industry competitors?

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