Blogging PostsQuality Articles On Wide Range Of Topics. Share Practical Skills.

MARKETING is absolutely vital in a recession, so why is it that so many companies’ marketing budget gets slashed in testing economic times? It comes down to fear.

The fear that there are insufficient funds to sustain any significant marketing budget.

The fear that there is not enough money to sustain decent marketing spends.

And, most damagingly of all, the fear that marketing will produce no results as “customers do not spend when the economy dips”.

Such fear can be understood, but that does not make it any more logical; all the evidence points to the fact that when a company reduces its marketing outlay in a recession its chances of surviving plummet.

But why is this? Because many of your competing companies will recognize that recession presents an ideal chance to market bullishly, and take customers and clients from rivals firms who do not have the stomach for this. Dollar for dollar, marketing in a downturn provides a much greater return on your investment.

Take as an example Europe’s biggest low-cost airline, Ryanair, which is the perfect case study for companies seeking a strategy on how to market in a tough economic climate.

In the months following 9/11, Ryanair achieved a position of market dominance. After the Twin Tower terrorist strike, the entire airline industry predicted that people would shy away from flying.

Virtually every other airline believed people would not want to fly in the wake o 9/11, and as a result, they froze marketing budgets. Ryanair, though, felt that by following suit it ran the risk of losing market visibility.

So unlike its competitors, Ryanair set out to marketing itself aggressively, and took active steps to lure people back on to its aircraft. Ryanair’s startling growth during this period shows that a brave marketing strategy can see a company through difficult periods.

Learning hard recession marketing lessons_Today, it seems the airline industry has learned its lesson, because results from a recent survey by Airline Business shows that most carriers believe marketing spend should not be slashed during difficult times.

Around 45 per cent said they plan to spend “about the same”, 30 per cent said their marketing budget for 2009 would be “higher than last year”, while a further 10 per cent said their marketing budget for 2009 would be “significantly higher.” Only 15 per cent plan to “spend less”.

Visibility is key during a recession_’We’re going to spend 10-20 per cent more on marketing this year,” reported Icelandair chief executive Birkir Holm Gudnason, whose home market suffered more than most with the collapse of the Icelandic economy in October.

“We’ve seen that as soon as we cease our promotions the number of bookings falls. But if we’re visible, the volume of tourists coming to Iceland rises.”

As the Chartered Institute of Marketing warns in its white paper on recession marketing, ‘Keep calm and carry on Marketing’: The bottom line is that if you are not in the game, your competitors certainly will be, giving them an edge you don’t want them to have.

Planet Client is the only blog helping businesses find clients, retain clients and understand clients. It is part of journalist Sean Ashcroft’s business gift service, Sticky Clients