For some businesses, 2023 has started a lot slower than recent years. Whether you call it an economic recession or not, there is no denying the impact quieter months can have on your business when they start to compound. Often when things start to slow down, and especially in a recession, businesses who are fearful of declining revenue, begin to cut back in various areas, and one of the first always seems to be on their advertising spend.
If we look at the last major recession in 2008 to 2010, ad spending globally had dropped by 13% across the board. For small businesses, this statistic grew as high as 60%. This means, more than one in two people cancel spending money on advertising during a decline.
Here is why that’s not great for them, but amazing for you if you choose to keep your spend.
Throughout history, there have been many studies going back over the last 100 years that point out the advantages of maintaining or increasing advertising budgets in a weaker economy. Those advertisers that maintained their marketing budget, or grew it, saw increased sales and market share during the recession, but they also saw the effects for years afterwards.
There are several key reasons to advertise when times get tough.
History has shown us plenty of case studies on a high end level as well, of brands who chose to advertise during a recession. There are many to choose from when looking at motivating yourself to continue advertising.
One case study we loved, was for obvious reasons.
During the 1990-91 recession, McDonald’s decided to significantly drop their marketing spend and promotional budget. Pizza Hut took advantage of this, and decided to push through the downturn with an increased advertising budget. At the time, McDonalds sales in that period declined by 28%, and Pizza Hut took a dominant 61% share of the fast food market in the USA.
Of course, in this instance we’re talking about two whales of the 1990’s, however back then there was no such thing as social media. Social media has opened up a whole new playing field for small business owners, putting them on a level playing field with any and every other brand.
First Tip – Get on your customers level.
An economic downturn is tough for everybody. Your revenue and bottom line might be shrinking, but you can be sure across the board that your customers wallets will be too. Showing sympathy and empathy for the difficulties your customers are experiencing can go a long way toward building long-term relationships, trust and credibility. So how can we apply this to your advertising? You don’t have to be to heavy handed, but by simply pointing out your amazing value, or bringing attention to cost-savings in your industry, you will resonate with where your customers are in that moment.
Content marketing is a super easy and affordable way to reach your audience and doesn’t have to cost you anything. Making your own blogs, videos and articles on topics that bring value to your customers will help earn their loyalty. Perhaps answer commonly asked questions or touch on any market conditions/news topics that are relevant to your industry and customer.
Second Tip – Branding efforts should 10x
As we mentioned, a lot of advertisers are canning their budgets – now is not the time to slow down, now is the time to get your name out there. If competition is starting to get quiet in your niche, take advantage of that opportunity! Branding doesn’t have to be expensive either.
Now is the time to take full advantage of Search Engine Optimisation, content marketing and organic advertising opportunities like Facebook and Instagram Reels, YouTube Shorts and dare we say it, TikTok. It is so easy to build out a consistent content marketing strategy that you can invest your own time into. The more growth and market share you can take during a recession, will be what really shines bright on the other side of the downturn.
Third Tip – Be in the now, with an eye on the long-game.
The pandemic showed the world that macroeconomic changes can greatly impact buyer behaviour in individuals for long periods of time. While often in tough times, we feel like it will last forever, history shows us that has never been the case.
The best way to gauge spending habits in your business is to start recording and collecting data. Start tracking how much your customers spend with you now and when the economy starts to pick up. In doing this, you can work out what changes are just a phase, and what buying habits are here to stay. The only way to do this is by continuing your advertising to keep your customer flow. Those that stop advertising lose the advantage of data recorded. If you can manage to do this well, you can make changes to your offerings fast and effectively, helping you stay relevant through bad times and good.
If you’re somebody who wants to keep advertising through the economic downturn, Vidsta is a cost-effective and innovative approach that will allow you to do so. We implement content marketing strategies tailored to your business needs, and help drive action through building on high-performing, engaging content designed to attract and convert your target customers.
Fill out the form below, and start the conversation with us today.
Our pricing and expertise will help your business continue to push through tough times, coming out the other side with a bigger and better brand identity and more customers.
