Posted by: brandextenders | April 19, 2010

Prospering in a Downturn

No matter what word you want to use for the state of the economy these days, the fact is business is still not what it was a year ago. Unfortunately, one of the first segments of business that’s cut from the budget when things slow down is marketing, including promotional products. Is the adage that companies who continue to market in a downturn will come out ahead true?

In 2008, the Penn State Smeal College of Business and the University of Texas put out a report titled, “Turning Adversity Into Advantage”  The report surveyed 15o senior marketing execs, looking to see why certain firms continue to market themselves during a recession, seeing the downturn as an opportunity and upping their marketing budgets. What the report found is that not all companies should follow this strategy and the authors’ site three characteristics companies must have to be successful with this strategy:

-They must already see value in marketing their brand and have been marketing proactively before the downturn
-They must have the nerve to step up their spending which the report finds is typically entrepreneurial companies

-They must have the capital to increase their spending because no matter how good a product or service is, it’s a risk to be spending precious cash in a downturn

So what types of businesses should we, as marketers, be targeting in this environment? Forbes magazine in an April 2008 article suggest categories that prosper during hard times are outplacement firms, debt consolidators, trade schools (laid off workers looking to gain new skills) and private labeled goods. Vacation spots might look locally to attract those within an hour or two drive as airfares and gas prices continue to rise making if difficult for families to travel far. And as families “nest” more, staying closer to home, products ranging from consumer electronics for the home to video rentals to popcorn could fare well from increased marketing.

The idea is to use your creativity and find ways your clients can attract new customers and, just as important, ways for them to hold on to their current base. Look for ways for ways your clients might partner with synergistic businesses to help share in the cost of marketing and offer to make those connections and bring the parties together.

For those in any industry who are creative and willing to work harder, the business is there. You too might have to spend more on your efforts to attract and retain business, but if you have a plan and are willing to take some risks, you could find yourself way ahead of the competition as the economy begins to turn around. And turn around it will with some industries already beginning to see an uptick in their business.

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