The True Cost of Cutting Advertising in Hard Times
When times are hard difficult decisions need to be made. Somethings just can’t be cut and your advertising and marketing might seem like an easy slash from the bottom line, but at what cost?
1. Going Backwards
It is important to keep a constant supply of new customers coming to your door. Even your most loyal customers will move away, look around and be tempted elsewhere, or even sadly pass away. Things change and for most business at least 10% of customers will naturally decline.
2. Retention
Your customers are being constantly bombarded with new and tempting offers. Perhaps they hear a glowing review for one of your competitor’s or a friend of a friend starts up and they want to help them out. Promoting yourself not only attracts new customers but keeps you firmly in the mind of your current ones.
3. Are Your Competitors Cutting
It is a no brainer really, if your competitors are advertising then you must too. Buyers feel better about companies who advertise in tough times. When times are hard customers trust companies that are seen to be succeeding in a difficult time. Aggressive marketing during difficult times can see your leading competitor out of the market.
“When times are good, you should advertise; when times are bad, you MUST advertise.”
4. Forgotten
It is more expensive and takes longer to gain back the customer you have lost. They will have looked elsewhere, experienced different services and price points. You may never win them back.
5. Long Term Advantage When Times Are Hard
A five year survey of over 3,000 businesses found that companies who maintained or expanded their advertising saw their sales increase by an average of 100% whilst the companies that cut their advertising saw no growth or decreases of up to 45%. At a time of rising costs it is imperative to grow your customer base not stagnate or shrink it.
If you want to read more about 100 years of data to prove this check out this article
6. Advertising Works
What is the best known burger brand in the world? McDonalds of course! Are they still advertising? Yes they are, because it works and because they know the risks of not. Advertising creates brand awareness, keeps your competitors at bay and leads to more sales. The most aggressive and consistent advertisers are invariably the most successful brands. It has been shown over time that advertising during hard times is a successful marketing strategy and can help businesses take leaps forward.
