By Peggy Tee ©
Battered by low consumer confidence and reduced availability of credit, small businesses are cutting it close during these times. Businesses react to shrinking profits by reducing costs such as advertising, often to the bare minimum, and occasionally stop marketing their business completely. However, Appleton feels, this cut-and-slash approach to cost management can lead to a loss of customers, reduced future revenue and smaller market share. Multinational companies like American Express and Kelloggs are maintaining or increasing marketing spend in the recession because branding is a key value driver for these companies. (“Best Global Brands,” Burt Helm, Business Week, September 2008). Small businesses should follow these successful companies lead – albeit on a smaller scale – as there are considerable benefits to maintaining a consistent marketing plan during hard times.
Attract new and keep old customers
Small businesses need to reel in new customers and keep existing ones through effective and sufficient advertising exposure. Rather than cutting back on advertising, businesses should reassess their marketing budget for ineffective spend. For businesses that rely mostly on local custom, an expensive advertisement in a national newspaper is unlikely to affect revenue significantly. We believe, small businesses should focus on effective media, such as targeted advertising in the local newspaper. A white paper written for the Customer Collective by Joshn Gordon espouses increased focus on shifting more product to current customers as opposed to chasing new customers. This approach is more profitable, easier and helps improve customer relationships. The small business that takes this approach will need local and targeted ads to carry the message of new products and packages to their existing customers. Appleton can help you with your message and create a plan that will work.
Maintain customer influence
Advertising is a powerful tool that can be used to convince customers of the reliability of the business and is ironically, even more influential during a soft economy, a time when businesses are intent on reducing costs to stay afloat. An Ad-ology Research (“Advertising’s Impact in a Soft Economy”) found that almost half of American adults believe a reduction in advertising by a shop, bank or car dealership during these times indicates the business is struggling. On the other hand, businesses that continue to advertise are seen as competitive and committed to doing business. The study shows that cutting back on marketing during soft times can adversely affect customer relationships with small businesses and lead to a reduction in future revenue.
Find a competitive edge
An effective marketing strategy that focuses on online advertising, such as Search Engine Marketing, listings on Yahoo! and monster.com through local digital media companies, is a cost-effective way for small businesses to increase visibility. Research by Opus indicated that almost 45% of all small to medium enterprises had intentions of moving towards online advertising (“Aug 2008, US Small Businesses). Savvy business owners could find a competitive edge and increase their market share with a well-timed, integrated print and digital marketing campaign conducted through local newspaper and media companies. Millward Brown, the leading British research company, found that businesses that increased marketing investment while their competitors cut theirs substantially increased the prominence of business’s brands.
For more ideas or to talk about your advertising campaign, call Appleton Creative: 407.246.0092 ext. 1#.Tags: ad, advertising, appleton creative, cost, print