Marketing in bad economic times



There is no doubt that our economy has shrunk, however, there seems to be arguments on both sides as to how well our economy is now doing. Marketing and advertising are widely affected by the shrinking or growing of our economy, so I keep up with current news in our economy and with the world economy. Currently, the argument is whether or not the economy is turning around and is on an upswing. Keep in mind that unemployment has risen to 10.2% and may increase again next month. The average consumer spending has risen, but how much of that was demand borrowed forward from the first half of 2010? Is our economy recovering and will it recover to the levels we had in 2006? These questions still have yet to be answered, without a doubt.
What significance does our economy have on marketing and advertising? Well, as most marketing and advertising firms already know, these budgets are the first to be cut and the last to be added. Most companies see advertising as a luxury item instead of a necessity, so they are willing to cut those costs in order to keep other parts of their company operating.

It would be wise for companies to keep spending money in advertising and marketing during these times. People buy goods and services based on their ability to recall from their memory the name of a company who sells that particular good or service. In order for a person to recall that company, the consumer has to be exposed to that company repetitively. Many self improvement trainers will teach people to repeat the name of a person repetitively as you speak to that person in order to recall the name from memory at a later date. The same principle applies in advertising. Companies need to present themselves to consumers 9 times to be remembered once. In order for that company name to become part of their vocabulary, they need to have 5 to 7 causes to remember the company. That means you need to have 45 to 63 impressions on a consumer. One of the ways to make these impressions on consumers is advertising.

A company with a healthy advertising budget during bad economic times can make significantly more impressions on consumers than they did before the recession with the same amount of money. Why? The competition is spending less on advertising therefore making less impressions. The bottom line is that when the economy does grow and consumer spending does increase, a smart company will be well ahead of their competitor.

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