As a 40-year-old company, we’ve seen quite a bit—huge digital developments, wide-scale thought shifts, and, of course, our fair share of disasters. Still, the way the world has shifted in recent years and continues to shift is like something we’ve never seen before, which has many people and businesses wondering what comes next. Though it’d be naïve to think we’ve seen the last of large-scale turmoil, we at the very least have lessons from experience to impart to those willing to take note.
As Forbes detailed, from the Great Depression to the recessions of the mid 70s, early 90s, and late 2000s—and counting—one way businesses scale back on costs in times of unpredictability is by shelving their marketing and advertising efforts. In the wake of the 2008 recession, ad spending in the U.S. dropped a remarkable 13%.
How does the decision to scale back on advertising impact your business beyond the initial cost savings?
Delving further, this begs the question: How does the decision to scale back on advertising impact your business beyond the initial saved costs? In advertising and PR, we look at the share of voice (SOV), or the percentage of your advertising spend relative to your industry’s total advertising spend. The trend seems to be that businesses falling behind in SOV also fall behind in market share. What does this mean for your brand? As LinkedIn puts it, “[Cutting advertising budgets] may provide some short-term relief to profitability … but the subsequent loss of market share that follows will be extremely difficult and expensive to regain during the recovery.”
Now, we at BNO are a creative bunch, so we know data trends and budget talks aren’t for everyone. So let’s break it down with some catchier words of wisdom on why slashing your advertising budget may not be the clever remedy you hope it will be.
“Doing business without advertising is like winking at a girl in the dark. You know what you are doing, but nobody else does.”
It’s a famous quote, perhaps for its frisky vibe and humor as much as its wisdom, but Northwestern University psychologist and professor of marketing and advertising Steuart Henderson Britt was surely onto something. As someone who knew the ins and outs of advertising’s influence over a consumer’s mind, he knew as well as anyone that marketing is your business’ opportunity to offer your story, solution—your wink—to your prospects. And when you go dark, the memory of your brand fades. No one goes home with what you’re sellin’.
“Creativity may well be the last legal unfair competitive advantage we can take to run over the competition.”
If your brand disappears from the world of marketing and advertising, your competitors will inevitably replace you in the mind of the consumer. How? As creative director and copywriter Dave Trott mused in the above quote, with ultra-creative, attention-grabbing storytelling. Across industries and across the board, the best and most successful brands are making a vested effort to leave a lasting impression on consumers with engaging creative. Want to sweep out the competition? Put on your mind-blowing-imagination-and-inspiration cap and get to work—or invest in a partner that knows their stuff when it comes to effective creative; someone who winks at you NOT in the dark.
“Stopping advertising to save money is like stopping your watch to save time.”
Henry Ford knew a thing or two about building a company—and a brand. And this simile from him pairs nicely with the above quote from Trott. Sure, you can cut spending by forgoing your ad spend, but time will not stop. Since you can’t know for sure what your competitors and consumers will do in that time, it comes down to weighing the risks of falling behind. You then have to ask yourself: Do you want to remain a part of the competitive conversation? Or, would you prefer to make a mad dash and heavy investments to catch up when you decide to reenter the race for market share?
“Recession is opportunity in wolf’s clothing.”
Yes, the times they are a-changing. And times, they are a-difficult. Decisions in times of uncertainty do not come easily. Perhaps this quote from leadership expert and author Robin Sharma helps to shed a little light. Some of your competitors will choose to cut their advertising spend—and consequently their presence—in turbulent times. Are you starting to see beyond the wolf? A less-crowded market means that times of turmoil might just be your chance to truly distinguish your brand and step out into the lead, should you be bold enough.
Are you feeling ready to give your brand a voice that’s fresh and exciting enough to put you ahead of the game?