Economists throughout the nation have been projecting that the US will enter a mild recession during the first half of 2023. And while economic growth (and the labor market) is not expected to weaken anywhere near close to what happened in 2020, a downturn is on the horizon.
Suffice to say, lots of small business owners have already started to develop an adaptation plan. In some instances, this means implementing temporary hiring freezes and/or holding off on large expenditures. In other instances, people are starting to evaluate other cost cutting measures. However, if you think your business revenues could be impacted, the one thing that you shouldn’t cut is your digital marketing budget.
Below are just a few of the reasons you’ll want to keep that intact.
You could potentially grow your market share
In a slowing economy, you should keep close tabs on what your competitors are doing, as this could provide you with an opportunity to grow your business. For example, if your largest competitor is less active on social media, they’re posting less blogs, and their SEO looks like it’s starting to suffer, that’s the time to strike.
This isn’t just a strategy that works today- it’s one that’s stood the test of time.
In the height of the Great Depression, Post Cereal executives decided to trim their advertising budget as a means of saving cash. Kellogg, on the other hand, did the exact opposite. By the time the Great Depression was over, Kellogg’s profits had risen close to 30%, and since that time, they’ve been the nation’s #1 cereal brand.
Other key statistics include the following:
- According to an August 2022 press release from Analytic Partners, 60% of brands that increased their media investment during the last recession saw ROI improvements.
- Brands that increased paid advertising also saw a 17% rise in incremental sales, while those who slashed spend risked losing 15% of their business to competitors who boosted theirs.
- The data further suggests that companies and organizations that trim their marketing spend are not only more likely to lose ground to their competitors, both during and after a recession (which is exactly what happened in the Kellogg / Post example), those who maintained or increase their spend are in a much better position to improve their ROI.
Are you interested in learning more about how to manage your digital marketing budget during a recession? We can help. Call WBN Marketing of Florida today to learn more.