There is no doubt that we’re going through some tough times right now. In the throes of the COVID-19 pandemic, we’re all experiencing the challenges this worldwide crisis has inflicted on our daily lives, businesses and the global economy.
A question that’s on many business owners’ minds: What is the right way to lead my company through this crisis?
Historically, businesses begin to cut every non-essential cost during a recession in order to conserve cash through the economic downturn, from reducing inventory and supplies to halting product development. Oftentimes marketing is among these first line items to go – but should it be?
In short, no.
Research conducted on marketing trends during previous economic hardships tells us the opposite is true. Here we explore why marketing is essential, what research on past recessions has taught us, and what businesses should focus on through these tough times to retain (or increase) their market share and position themselves for growth.
Why is Marketing Essential?
From new start-ups to established companies that have been around for decades, one thing holds true for all of us: people need to hear about you to know about you. This requires marketing.
Will the marketing strategy differ for those companies on opposite ends of the business spectrums? Greatly. However, one common thread is that they need to spend money to make money, and marketing is an essential component to make that happen.
Especially in times of crisis when cash flow is slow and your fixed costs are high, the only way to increase profit is to increase revenue. To do this, you have to increase sales, which heavily relies on your marketing efforts.
How Decreasing Marketing During a Economic Downturn Makes a Bad Problem Worse
Cutting off your marketing is a short-term solution that creates a long-term problem, making it harder for your business to recover. Studies show that companies who kept their marketing volume the same – or increased it – through a recession, had even greater market share than they did before compared to those who cut their advertising.
One McKinsey study on high-tech companies spanning 20 years of economic cycles reported, “Our analysis shows that making obvious moves (for instance, cutting costs) as well as counterintuitive ones (such as increasing sales and marketing expenditures) quickly can improve a company’s position when the recovery begins.”
In the 1973-1975 recession, Toyota was tempted to follow competitors’ leads and drop their marketing budget. Instead, they kept on with their brand-building marketing strategy, which propelled them into the #1 import spot – a title they still hold today.
During the Great Depression, while Post did the predictable move of cutting their advertising budget, Kellogg took the counterintuitive approach by doubling theirs and introducing a new product. This led to a 30% increase in profit and positioned them as the industry leader, a position they’ve held ever since.
Tough times call for creative solutions. When it comes to marketing through a crisis, history has given us the answer, time and again, how to use the hand we’re dealt to our best advantage. This is where a creative, extremely strategic marketing plan comes in.
Making Lemonade: How Strategic Marketing Can Help Your Business Through Tough Times
When the companies discussed in this article were faced with crises and difficult choices, they took the path less traveled and came out the other side stronger for it.
Benefits of marketing during tough times:
- Less noise to compete with as more businesses drop their marketing efforts
- Company projects an image of stability as you stay visible during the storm
- Take advantage of a buyer’s market with lower-cost advertising opportunities
- Gain share of mind and voice for long-lasting increase in sales and market share
Where there are problems, there are opportunities – find ways to make your lemonade using the marketing strategies that are most advantageous for your business right now.
What Marketing Methods Your Business Should Focus on Right Now
The coronavirus has caused more people to stay home as we work to slow the spread of this virus worldwide. With this shift in lifestyles, we’re seeing more activity online as an increased number of people are working from home, staying connected to loved ones from afar and are keeping up with current developments around the world.
Right now, your focus should be to meet your audience where they are – online. Take this opportunity to allocate the majority of your marketing budget to optimizing your website, increasing your digital advertising, connecting through social media and updating content marketing to be as relevant as possible.
Website: Spend time investing in your web presence right now. This is where people will be interacting with your brand the most in these stay-at-home times we’re experiencing, so make their user experience the best it can be with:
- Improved SEO
- Consistent branding
- Informative, concise messaging on products, services and changes to processes
- Clear and direct calls-to-action
Now more than ever, your digital advertising should be ramped up (or started!) to get you in front of a wider audience of high-quality, prospective leads. Some key areas to focus your digital strategy right now include:
- Paid search ads
- Email marketing
- Online promotions
Social Media: Connecting with your audience is always vital to your success, and in these uncertain times more and more people are looking for ways to do just that. Use your social media platforms to:
- Engage your audience
- Share solutions you can offer to help customers
- Keep customers informed of company news or changes
- Promote time-sensitive offers
Content Marketing: Be thoughtful in the way your content approaches your audience during these times. Many companies plan out their marketing calendar months in advance – with the rapidly changing reality we’re currently in, make sure your messaging is time-sensitive and as relevant as possible to what your customers are experiencing right now.
While these times we’re in are unprecedented, the history of marketing through tough times is not. Make the most of your marketing budget by using these cost-effective ways to reach customers and prospective customers to continue growing your company in the right direction.
Our team at Stray Media Group is here to help in any way we can. We want your business to not just survive, but thrive in the face of this worldwide pandemic – let’s work together to make that happen.