Marketing and PR Tactics, Budgets Likely to Change During Recession
by Phil Morabito
January 09, 2008
Houston Business Journal
When the budget is on the chopping block, marketing and public relations allotments are often the first to go.
But, according to Phil Morabito, CEO of Pierpont Communications and MBA adjunct professor in the University of Houston marketing department, companies that remove themselves from the public eye when times are tough are making a common mistake during the first days of forced cost reduction.
Q Entering a recession, company executives forced to make cuts may look at the marketing budget and see a big bull's eye. What are some cost-effective strategies businesses can use to remain in the spotlight and maximize competitive advantage?
A What companies don't realize is their marketing budget will go a lot further and create much more buzz in a down market. As your competition pulls back, you should become much more aggressive. When you do, you will achieve top-of-mind status and grab market share as the economy stabilizes and will be able to remain on top during the next upswing in the economy. Sticking to this strategy can be difficult for many executives because it is counterintuitive to what is a natural emotional response, but if you stay the course the market gains will be significant.
Another effective approach is to tactically shift your marketing focus to low-cost/high-impact strategies. Cost-effective tactics include media relations, speaking engagements, power mapping and networking, e-mail and online marketing and others that allow you to reach out and touch your target audience on a regular basis.
Q When considering the mind-set of potential customers, should executives focus on changing their marketing strategies or adjusting their brand message?
A A balance of both is a wise strategy. Your brand messaging must highlight your offerings and clearly resonate with specific customer markets during this period. Everyone is looking to do more with less, so a clear value proposition is critical. Every company should revisit its messaging strategy across the board, from internal communications to key competitive sales messages in 2009 to guarantee it is in alignment with the changing needs of their markets. This one activity will impact and maximize the return on every marketing activity you implement during the year.
Executives must also be careful about dropping certain activities altogether and radically changing their marketing mix - especially without testing. There is no ROI in investing in a particular tactic, building awareness and then totally shutting it off when the economy goes soft. This makes much of the previous effort worthless. Marketing is about building, growing and maintaining a brand image and strong competitive differentiation. Companies that make dramatic changes to their tactical marketing mix will pay the price with less business in the future.
Q What about changing slogans or launching new products at this time? Should companies hold off on launching new products until consumer confidence picks up?
A There is no need to change your brand message or tag line - especially if it has been working. You want to be as consistent as possible during recessionary periods to build credibility within all your stakeholder audiences. Do not confuse the marketplace - it will take too much of your marketing budget to clarify and build impact with a radically new message. Determining whether or not it is the right time to launch new products or services depends on many factors, such as competition, market need, pricing options and many others.
Q What types of companies have been affected the most? Is it more important for some types of businesses to invest in their marketing efforts than others?
A All industries are being affected by this downturn in one way or another. From a marketing standpoint, the most important thing you can do is stay the course. You will not succeed by embracing a strategy of stopping your marketing efforts with a promise to "increase budgets when the economy is better."
On the other hand, you will make a tremendous impact by keeping a consistent message in front of your customers and prospects - even "turning up the volume" in a down market. Smart executives who have lived through previous downturns know how critical it is to stay in front of their targets during a recession. Being visible communicates stability, growth and progression, while becoming invisible will only result in having the marketplace wonder what happened to you.
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