Cutting Advertising During A Recession – Not A Smart Move

In February of 2008, we ran the following article on the YP Talk website:  Cutting Advertising During a Recession.   The article quoted several sources that all made the same point — the dumbest move an advertiser or marketer can make in a slow economy/recession is to cut their advertising budget.

The facts are clear from numerous studies conducted during recent recession periods.  For example, McGraw-Hill Research analyzed 600 companies covering 16 different SIC industries from the 1980 through 1985 period. The results showed that B2B firms that maintained or increased their advertising expenditures during the 1981-1982 recession averaged significantly higher sales growth, both during the recession and for the following three years, than those that eliminated or decreased advertising. By 1985, sales of companies that were aggressive recession advertisers had risen 256% over those that didn’t keep up their advertising.  The article also provides other links to similar type results.

In the article we noted the comments from Saatchi & Saatchi’s Kevin Roberts,
writing for Advertising Age magazine best summarize it — “Consumers don’t stop buying when economies go though down cycles. They look harder for value.”

Or, as another unnamed major business-to-business advertiser put it “When times are good, you should advertise. When times are bad, you must
advertise.”

Yes, this economy still is sluggish in many markets.  And not doubt, many small businesses are struggling.  But if they want their business to succeed and thrive, it’s time to spend more on a solid advertising program that has a solid, real positive ROI.  Can you say “yellow pages”???

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One response to “Cutting Advertising During A Recession – Not A Smart Move

  1. This is so valuable and so very, very true! I’m printing this out to show my customers next week. I am seeing it in the field every day as well….when my customers decrease their print advertising because “everyone is on internet”, I am watching that decision impact their bottom line and in some cases, I’m watching as their business folds and they are forced to go work for their competitor that kept their print the same. People are using the internet and mobile phones, no doubt, but they are still picking up the phone books and looking for products or services….especially in Louisiana and Mississippi! “Google on Paper” is what my Director of Sales said during a meeting, and boy, is that true!

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