Why you must Advertise during a recession
by
Bill Kaye
Bill Kaye
"I have to cut my advertising budget; there’s a recession going on...”
Sound familiar?
When times get tough for an organization or business, advertising budgets are often the first expenses to be evaluated. Traditionally, most retail businesses see fewer customers in the dead of winter or during the long, hot days of summer, when customers are on vacation, not just from their jobs, but from patronizing your business. Nonprofits have similar “lean donation seasons.”
And in a recession, every organization feels the pinch.
When there are fewer dollars to spend, confidence erodes, fears increase and consumers, voluntarily or involuntarily, sharply curtail their budgets.
And that affects businesses, for-profits and nonprofits alike, churches, volunteer organizations; everyone. When revenue shrinks and expenses don’t, cutbacks are required. A reactive conservation mode sets in: supplies are rationed or allowed to shrink to lower levels before they’re re-ordered, expense accounts tightened, “frivolous” or unnecessary expenditures are denied. But if the downturn continues or shows few signs of ending, further cutbacks are needed. Sometimes, layoffs result and some unfortunate businesses shutter for good.
And what about advertising?
“If no one’s going to spend anyway, if no one’s going to buy or donate, why should we waste our dollars?”
That’s a fallacy as maddeningly common as the erroneous assumption that cutting employee hours will help the bottom line.
How many times have you, as a consumer, been frustrated by the lack of help you receive in a store that is obviously understaffed? Are you patient, understanding that the inconvenience is temporary, or do you walk out, vowing to never return? And when you do finally get someone to wait on you, are they so stressed by the extra workload that they’re less friendly, less efficient, less helpful?
The math is simple: Fewer people on staff equals fewer people ready to assist their customers. And fewer customers equals fewer dollars ringing up at the registers.
Then what happens? More than likely, staff hours will be cut again. Customers figure this out quickly. If customer service is lacking or nearly nonexistent, they're less likely to patronize a business.
Is it so crazy to assume that if there were more people working, more people would be helped, more customers wouldn't leave in frustration, and the company’s CSI (Customer Satisfaction Index) would improve?
Proportionally, sales will likely go up, and profits will rise. That may be oversimplifying a complex business model, and flies in the face of the economics principles taught to MBA candidates in business schools.
But tell the truth: wouldn't you rather shop in a store where people are there to actually help you?
Now let's look at what can happen if advertising dollars are cut as a knee-jerk reaction to slumping sales or anticipated slowdowns.
Many retail businesses are naturally reluctant to advertise during times when they believe that their "through the door" count will be smaller. They hesitate to advertise in the dead of winter, as storms might keep people away from their "big, bigger, biggest!" sale.
Similarly, summer vacations and weekends divert regular customers from retail stores in non-resort areas. The thing is, not everybody goes away. For some, this is an excellent time to shop, because they know the crowds will be smaller.
But as a businessman, you have to make sure that they remember you. Don't make the mistake of assuming that "if I sell it, people will come." And.. "they know who we are and where we are." This is far more critical than you think.
Consider this: a perhaps apocryphal story goes that as a marketing test several years ago, McDonalds adopted a one-day nationwide moratorium on all radio and television commercials.
It was an exceptional step for a company that fully understood that advertising, even when there is nothing specific to sell, is vitally important. For years, McDonalds would routinely air “image” breakfast commercials at the end of local late news TV broadcasts; the reasoning being that a final impression before the tube was turned off for the night would be an impetus to drive customers to Mickey D’s the next morning for an Egg McMuffin.
As the story goes, overall sales at all locations dropped precipitously because of that one-day “no ads” test.
Whether the story is true or not, the point is important: if no one knows you’re there, if you aren’t constantly reminding your clientele about your existence, they’ll forget about you.
Or worse, they’ll go elsewhere.
If you’re lost in the woods and you don’t signal for help, who will come to rescue you? And if someone else is also lost and conversely, is shouting at the top of their lungs, building a signal fire, or doing it with mirrors, which person is likely to be found first?
So what does all this have to do with advertising during a recession?
If you think about it, recessions or economic slowdowns are no different than your typical slow periods, except more pronounced. Not to mention scarier.
“But it makes sense to cut unnecessary expenses. How do we know our advertising dollars are really working?”
The answer to that is startlingly simple. Your advertising dollars, your promotional efforts and your marketing materials DO work when:
- More people walk through the door
- The phones are ringing off the hook
- You can’t keep up with your emails
- Your cash register receipts or donations increase
When you don’t advertise, when your promotions are weak or unexciting, when your marketing materials are pedestrian:
- Fewer people walk through the door
- You can answer the phone patiently
- You have time to delete spam and junk email and even surf the internet
- The only time you think about receipts is wondering if you spelled it right
The bigger question concerning your advertising, promotional or marketing campaign should be: who writes it?
Every organization relies on writing, every day. Unless you pay someone to write, whether on staff or by contracting out, chances are, some of your most important writing is left in the hands of those who aren’t trained for it. Someone for whom writing is a chore, or a task to be rushed through and pushed as quickly as possible from the “inbox” to the “out.”
Often, in times of tightened staffing, you’re the one writing the article, business letter, newsletter, brochure or public relations piece.
Is that how you want to spend your time?
What you can’t forget is that everything that goes out under your organization’s logo or letterhead reflects on you.
Don’t delude yourself… every single word makes an impression.
Is your written material as effective as it can be, are you getting results?
Think of the last project you or your staff completed. Did it really do everything you wanted it to do? Did it produce? Did your customer count increase, did the phones ring, did your bottom line improve?
It all starts with the writing. Because no matter how extensive or focused your advertising, no matter how splashy your graphics, if the words aren’t persuasive, no one’s visiting, no one's browsing, no one's buying.
And during a recession, if you're not letting your customers know you're still in business, and that you're offering great ways to stretch their fewer dollars, what are the chances they'll come flocking to your doors?
Advertise, advertise, advertise. Good times and bad; now, and always.
And work with a professional to hone your image... it all starts with the copywriter!
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