Brand and Marketing in a Downturn

A downturn is the time to refocus your marketing budgets, not cut them.

There is no doubting the apprehension is rising for many of you as the economy weakens. I know it is tempting to begin the slashing process of your expenses. And, I know that marketing is one of those areas that typical gets the brunt of those budget cuts.


Sure, you should always be doing everything you can to maximize your marketing resources. That's true, even in a good economy. But history shows us that now is just not the time to curb your marketing efforts.

Here are some of the facts from past recessions:

• 1970 recession year - American Business Press (ABP) and Meldrum & Fewsmith study showed that "sales and profits can be maintained and increased in recession years and (in the years) immediately following by those who are willing to maintain an aggressive marketing posture, while others adopt the philosophy of cutting back on promotional efforts when sales appear to be harder to get."

• 1990-1991 recession years - Management Review asked AMA member firms about spending during the 1990-1991 recession. "Fortune follows the brave," it procliamed, noting that the data showed that most firms that raised their marketing budgets enjoyed gains in market share. Among the magazine's sample, 15 percent reported "greatly decreased" ad budgets. Advertising was "somewhat cut" by 29 percent. "The keys to gaining market share in a recession," concluded Management Review" seem to be spending money and adding to staff. Firms that increased their budgets and took on new people were twice as likely to pick up market share.

Beyond the statistics, why might it be more important than ever to market despite economic downturn? Strong consideration should be given to the idea that marketing plays a more critical role now than it did during previous recessions.

While marketing's role was once more informational than brand identity building, and considering that never more than today has the clutter factor been so great, relationships between customers and brands are critical.

Relationship marketing has surged to the top of effective marketing campaigns as a means to keep an appropriate level of share of mind for purchase loyalty. Marketing serves to foster and maintain consumer-brand relationships.