Warren Buffet's take on investing in a stormy market has its place in the marketing world too: “Be fearful when others are greedy, and be greedy when others are fearful.” Just as the wise investor knows that the best opportunities are found in down markets, smart marketing executives know that this is the perfect time to proactively market their product or service.
Many of the recession-proof strategies your financial advisor preaches can and should be applied to your marketing efforts. The following six strategies – long-established in the investment world – parallel the marketing steps you should follow right now while your competitors are “playing it safe” on the marketing sidelines.
Strategy No. 1: Think Long-Term
Since recessions usually last six to 18 months, it's important to focus on your long-term gains instead of short-term losses. Proactive marketing during a recession yields increased awareness and market share. According to How Advertising in Recession Periods Affects Sales, by the American Business Press, companies who cut their advertising budgets during a recession had hardly increased their sales by 50% two years later, while companies who had continued using their funds increased their sales by 200%.
Strategy No. 2: Stay the course
Don't jump in and out or attempt to time the market. Instead, maintain a consistent and disciplined approach that always maps back to your long-term strategic goals. For marketers the same holds true. More so than ever, right now you need to maintain a disciplined and consistent approach that is laser focused on moving your target audience to action and accomplishing your organizations long-term strategic goals. Jumping in and out will hurt your brand in the long-term.
Strategy No. 3: Don't make decisions based on emotion
Never act on a panic moment. Rather than making decisions based on emotion – which only clouds good judgment – focus on sound and proven fundamentals. Likewise, once you've committed your marketing budget to a particular product or idea, don't pull the plug on it or change your mind unless you can qualify it as a smart business decision that supports your long-term goals.
Strategy No. 4: Stick to the Fundamentals
Now is not the time to get risky with your portfolio. Invest in what you know will perform, such as staple stocks that have great upside potential. Same is true in marketing. Forget about the frills or tactical one-offs that deliver quick, shallow returns. Instead, stick with marketing programs and strategies that you know will work, and work with marketing firms that have a proven track record for creating winning results.
Strategy No. 5: Diversify
It's a basic principal of investing – diversify your investments to minimize risk and maximize your returns. In the marketing world, opt for programs and campaigns that seamlessly integrate multiple disciplines to create stronger, better results. A campaign built from one strategy and supported by PR, online, advertising, and marketing initiatives, for example, is a safer bet and will deliver more bang for your marketing buck.
Strategy No. 6: Be greedy when others are fearful
A down economy is the ideal time to buy low and gain more ROI on the upside once the market picks up again. Recessionary fears may cause your competitors to cut their marketing budgets, but their loss is your gain. With less clutter to compete with, you can and will gain market share, negotiate lower rates for your ad spends or secure added value from your vendors who value your business.
While recessions are an inevitable part of the business cycle, so are recoveries. Apply the same tried-and-true investment strategies to your marketing strategies. When your competitors finally emerge from the marketing sidelines only to find your company gobbled up market share, you'll be glad you listened to your financial and marketing advisor.
David Warschawski is CEO and founder of Baltimore-based marketing communications agency Warschawski. He can be reached at email@example.com
Jonathan Murray is a SVP of investments and a wealth management specialist for UBS in Hunt Valley, MD. He can be reached at firstname.lastname@example.org.