Marketing as an Investment: The Key to Surviving The Great Recession

Is the recession over? It’s tough to say – foresight is never 20/20 – but according to a poll of economists conducted by The Wall Street Journal in the past few days, all indications seem to be that we’re emerging from the darkness, and economists believe Federal Reserve Chairman Ben Bernanke deserves a pat on the back for it.

Don’t try to tell that to David Wong, though.

Wong, along with his wife, runs a private dental practice based in Tulsa, Okla. According to a separate The Wall Street Journal article, Wong has seen a 10 percent decline in patients since the recession began. As patients lose jobs and tighten the belt, some expenses have to be eliminated, so in the battle between paying the electric bill and paying for a regular dental checkup, consumers often tell teeth to take a hike.

Unfortunately, consumers likely view all preventive health care in a similar light. Just because care is preventive doesn’t mean it should be neglected in a bad economy. That regular colonoscopy, cholesterol test or pap smear should never be considered an acceptable casualty of the personal budget war. Yet this is the reaction Wong sees as patients fail to show up for appointments.

Very well then, business is slow for everyone in a recession. What should Wong do about it? More specifically, how should this affect Wong’s marketing program?

Click here to view a video on the role of marketing in a recession.

Most entrepreneurs and service providers in Wong’s position face two choices when it comes to marketing. The first – and most common –is to cut the marketing budget. It makes sense, after all. When you have less income coming in, it’s best to cut expenses where you can and marketing is the easiest function to slash without affecting day-to-day business operations. Or so it seems.

The other option is the choice Wong ultimately decided to make: redouble your marketing efforts.

According to the article, Wong “has upped his advertising, taking advantage of low newspaper and broadcast rates, and now sends e-mail reminders to customers on top of traditional mailed postcards. He is even on Twitter, aiming to connect with customers as ‘not just the guy in a white coat with the drill in his hand.’”

“It’s a lot of hard work,” the article quotes Wong as saying. “You can’t go to the office and just be a dentist anymore; you have to go to the office and be a dentist and CEO.”

Wong understands this: In a recession, when money is tight and consumers are making tough choices, marketing is more important than ever before. As a business owner, you have a great opportunity when others are cutting marketing to get in front of your target audience and show the consumer why your services deserve their dollars. Customers who may have been in the bag when the economy is riding high suddenly need some extra convincing. They need to hear your message. That’s where marketing comes in.

In an interview with BNET, Dr. Gary Lilien, author of “Turning adversity into advantage: Does proactive marketing during a recession pay off?” a report by Penn State’s Smeal College of Business, pointed to three factors that should be considered before determining whether a marketing endeavor is worth the expense:

• Do you already have a marketing infrastructure in place? If not, it’s going to be difficult in this economy to launch a brand new marketing arm from scratch.

• Does your company have “the guts” to throw down the marketing dollars during a recession?

• Does your company have the budget to spend the money without damaging normal business operations?

“Companies that have been looking at marketing as an investment, and not an expense, and have been running their business through customer knowledge are the ones that are going to come out of this [recession] really, really well,” the article quotes Lilien as saying.

It’s important as well to make certain that your marketing efforts are reaching consumers through venues that they frequent. It’s pointless to spend money on distributing a message that no one will ever see. That’s why Wong’s strategy is a good one: he uses a variety of media, including the traditional as well as e-mail and social media. Mixing it up makes it more likely to reach both an older market as well as younger consumers.

Whether the economy is on track for a full recovery or a double-dipper recession, don’t forsake your marketing efforts. If expenses have to be cut, choose – but choose wisely. If you abandon your marketing efforts completely, you may soon find that your revenue is going the way of the stock market last November. corecubed can help. We have strategic marketing services that can fit any budget.