New Marketing Strategies To Beat Economic Downturn

New Marketing Strategies To Beat Economic Downturn

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Its widely accepted that were in a severe recession worldwide. In fact, heres a recent statement from the World Bank:

The world economy will contract by 1.7% and the richest countries by 3% in 2009. What began six months ago as a massive deleveraging in financial markets has turned into one of the sharpest global economic downturns in recent history. Robert Zoellick, President of the World Bank (Source: The World Bank, March 31st 2009)

So were in a recession now what? The next question becomes how deep is it likely to be? There are a lot of different views out there, which is almost expected, considering the unprecedented nature of this particular downturn. Were in relatively uncharted waters.

Heres what two of the worlds most respected financiers had to say on the subject recently:

The current global recession will surely be the longest and deepest since the 1930s. Alan Greenspan, former Federal Reserve Chairman (Source: Reuters, February 17th 2009)

Its an economic Pearl Harbor. The recession will be longer and deeper than most people think. This will not be short and shallow. Warren Buffett, Worlds Richest Man and Most Successful Investor (Source: Reuters, March 9th 2009)

Given that were in a recession, learning effective and proven strategies for surviving and thriving will be critical as tough times are likely to be around for a while longer. In true Darwinian style, only the fittest and strongest will survive.

But where to start?

Change Your Behavior in This Changing Environment

The very first thing you need to do is to understand how peoples behavior changes in times of recession. And thats not just the behavior of your prospects and customers. You also need to appreciate how the behavior of your competitors is likely to change too, so that you can respond better than they do in this recessionary environment.

Lets look at both of these facts in more detail...

Prospects and Customers Want More for Less

With less job security and more pressure on household budgets, consumers tend to be more selective on exactly what they are prepared to spend their money on. Luxury items and non-essential purchases are usually the first to be sacrificed as prospects and customers begin to tighten their belts.

For example, during a recession, high-end restaurants tend to suffer in a downturn as people begin to eat-out less and eat-at-home more to cut back on discretionary entertainment costs. Also, in times of recession, people tend to look for ways to save money on their current expenses in efforts to make their money go further. They may even expect you to lower your prices and give them even better offers than before.

Competitors Are Ready to Take Your Lunch Money

Of course, your competitors are not exempt from the effects of the economic downturn. They have their own concerns to worry about too. Fortunately, most businesses respond poorly to the effects of recession, which can be used to your advantage if you have the tools that will be necessary to continue to succeed.

For example, most businesses in a recession tend to panic and offer drastically lower prices in an attempt to keep the customers they already have. And theyll do this even if it means that the long term profitability of their business will suffer. In desperate times, some businesses will do desperate things.

One of the biggest mistakes that businesses will most likely be making in this recessionary environment is that theyll likely cut their marketing budget. Its understandable why they do this.

In tough times, most business owners look to cut costs wherever possible. They may they look to cut staff, limit working hours, or minimize business expenses. One easy target in the cost-cutting exercise is to slash the marketing budget to the bone.

But this is a huge mistake, and heres why...

According to Ogilvy and Mather, an advertising agency serving many of the top Fortune 500 companies, a recession is not the time to be cutting your marketing budget:

Companies that continue to spend through the recession recover faster than those that reduce their budgets. In fact, companies that increase their marketing spend in recessions recover up to 3 times faster in normal times. Ogilvy & Mather, Ad Agency to Fortune 500 Companies (Source: Optimizing Production Expenditure & Creative Assets, Ogilvy & Mather)

So while some of your competitors short-sightedly cut their marketing budget and unknowingly sentence themselves to slower recovery when the good times return, you can outsmart them and maintain or increase your marketing spend to recover much faster and take their lunch money.

The recession is an opportunity to put weaker competitors out of the market and decrease their market share and decrease their capacity when growth returns. Ogilvy & Mather, Ad Agency to Fortune 500 Companies (Source: Doing More with Less. White Paper by Ogilvy & Mather)

An added advantage is that fewer of your competitors are willing to advertise in a recessionary environment, meaning you get more exposure too. After all, a lot of your prospects are still out there looking for your type of product or service, which means that theyre more likely to find and buy from you if youre still marketing to them at that time.

While the current economic times are tough and hard for most people, every crisis brings with it tremendous opportunity...for the well prepared.

You can get the rest of this report as a free pdf download from the following page: http://lazerpromotions.com/articles

About the Author:
Warren Miller
Lead Marketing Consultant
Lazer Promotions, LLC
wmiller@lazerpromotions.com



Article Originally Published On: http://www.articlesnatch.com


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