The audience was shocked. 

What I told company Presidents changed an important reality most got wrong.  

And at another talk an audience of marketing and advertising professionals was stunned.  

To both audiences I said during times of economic uncertainty, businesses often make poor choices that are destructive but seem logical and easy at the time. 

The history of business shows that the first thing business owners do is cut their advertising and marketing budgets when there is economic uncertainty, fears of recession, rising costs due to inflation and often economic factors.  

But cutting marketing budgets has been proven to be the wrong cure for the problem. 

Just like raising taxes in a recession causes a greater recession or increasing government spending and the money supply causes more inflation, cutting a marketing budget only gives a short time benefit but negative long-term consequences. 

Here are the 6 things you should know… 

  1. Your marketing goal

The marketing goal in advertising is to reach, engage and convert prospects into buyers. 

Not only do your prospects need to know about the benefits of your products or services, but the messaging must also be repeated. 

Good marketing requires knowing the ROI and accountable advertising (see #3). 

  1. Cutting your advertising budget

Cutting the marketing budget when times are difficult is a normal reaction of business owners. However, over time, it’s been proven that’s a short-term fix, not a long-term solution. 

Here are just a few studies that show that maintaining and even increasing an advertising budget will not only help you get through an economic downturn but help you grow and even dominate your market over your competition: 

  • 365% sales increase for companies that maintained or increased their budget: McGraw Hill research study of recession marketing… 
  • 2.5% x market share growth by increasing their budget: In the last recession, only 18% of companies increased their marketing. As a result, their market share growth outpaced other businesses by 2.5 times… 
  • 9% grew during and after recession by increasing their budget: Harvard Business study. Of 4700 companies. But those who cut their budget only slowly recovered in 3 year after the recession ended… 

Henry Ford said it well: “A man who stops advertising to save money is like a man who stops a clock to save time.”  

  1. How long will the 2025 economic uncertainty last?

Recessions can be quite long, and it’s not something that comes and goes quickly. Many companies have already experienced the effects of a recession in this sector.  

How long do recessions last? 

What is the conclusion? 

  1. Why you should be using Direct Response Advertising during economic uncertainty 

Smart business proactively will use accountable direct responses advertising during economic uncertainty knowing its going to end. 

Direct response marketing delivers many benefits due to the quick ROI and high-volume lead generation on sales. 

It’s accountable advertising. It’s not guessing.  

Some additional benefits include: 

  • It’s easy to track and measure so it’s easy to see how many prospects and leads come from each campaign. 
  • It makes it easy to identify interested prospects who have shown interest in your brand or product. This helps sales teams focus on interested prospects instead of wasting time on cold prospects who are not interested. 
  • It helps create strong relationships with potential customers by establishing direct lines of communication with them. 

Direct Response Advertising creates cost effective and strong relationships with longstanding and potential customers, especially during an economic downturn or recession, when engagement is even more important to the survival of your business. Done right, it can help grow your customer base even during a recession. 

It can position you to dominate your market. 

  1. Adjust Ad Copy — Now

Your ad copy tactics and strategy must be adjusted to match the new realities. 

This includes overcoming your prospects cutting back. Use preemptive direct response copy. 

  1. Everything needs to be tracked for ROI

Tracking your marketing ROI is vital. It will tell you where you should put your ad dollars (and where not to) in order to build the most effective campaign, and not blow your budget. 

The data collected from tracking your ROI will show you what marketing channels are performing the best—Social Media, Prerolls, Direct mail, TV, native ads, geofencing and more. 

These analytics will help you allocate your budget to give you the biggest bang for your buck, especially in a downturn when every dollar counts. 

Remember to: 

  • Identify a target audience 
  • Set a measurable goal 
  • Design and implement your campaign… 
  • And measure your ROI 

Need help in this time of economic uncertainty? We know what to do and can help. Email Michael at [email protected].