Give Your Brand the Competitive Edge in a Downturn
You might not have realized, but America could soon set a record for the longest economic expansion since the glorious growth of the 1990s. For 117 months, America’s economy has been doing well.
But, as a marketer, you’re starting to worry.
You hear the whispers of a recession coming. At some point soon, you know the market needs to slow down. And when that downturn finally happens, your leadership team is going to start looking at budgets to cut, including yours. But despite a slowing demand, what do smart marketers do in a downturn?
They don’t reduce their marketing budget. They actually maintain or even grow it. Why?
Because smart brands know that advertising in a downturn is not about generating or regaining lost demand, but capturing and capitalizing on what’s still there in order to keep the brand competitive now, but more importantly, in the future.
At its core, advertising is about continually telling people you’re still open for business and exposing them to compelling product offerings. This exposure captures consumers’ “share of mind” - making your brand mentally available to them, ready to be thought of whenever they’re ready to buy.
Research has shown that share of mind and share of market are inherently connected. As other brands start to limit or keep stagnant their exposure to consumers, smart brands that get in front of people more often increase the ever important odds in a recession that their brand will be thought of first.
Having your brand be top-of-mind can be one of the most powerful tools hedging against poor business results. When a brand is thought of first and there’s less competition striving for consumer’s attention and share of mind, research shows that it’s easier for brands to gain market share in a softening market than in a strong market.
With this mindset, you can see that a downturn is actually a huge opportunity for your business. There’s market share to be immediately won in a downturn.
Better yet, not only does this protect your brand in the short-term, but it sets you up better for the long-term. Millward Brown reports that moderate increases in ad spending have the greatest effect in growing share as the market improves because you’ve capitalized on getting most mindshare in a period where competition was weak. Similarly, Harvard Business Review reported that coming out of the Great Recession in 2009, brands who had dramatically reduced spending and were hard-nosed in cost cutting were in less competitive positions when the economy recovered.
So while it might feel counterintuitive because demand is slowing, advertising in a downturn is critical if you want to get the most out of the market. It helps you keep what you have, and gives the opportunity to make moves that capture market share you didn’t have before. And by capturing more market share now, you’ll give your brand a lasting competitive edge against the future downturns to come.