Surviving the Economic Downturn

It is true, we are now being faced with difficult economic times. This means it's even harder to get the attention of your consumer.

In an economic downturn you will see changes in three major areas. They include:

• Budget Changes
• Consumer Behavior
• Market Changes

How will you respond to budget changes?

When it comes to budget changes companies typically pull their advertising and marketing budget. Truth is by doing this and reducing communication you are only affecting short term sales, which in return negatively affects profit. Are you sure this is the course of action

that you want to take? While this may give short-term relief you will risk losing market share once the economy begins to stabilize and recovery begins. Consider learning to be more cost efficient rather than reducing budgets, in the long run it will save you money.

How will consumer behavior change?
We all know that consumer behavior changes during a recession and in return this affects your bottom line. Your audience will spend less and delay major purchases and even trade down to cheaper alternatives. However, not all consumers stop spending. They will in fact alter their habits to better fit their financial situations, but they will never stop spending. They will lean more into cheaper brands and alternatives for the duration of the slow economic times, but if you maintain brand loyalty they will aspire to regain the ability to purchase the stronger brands in the future.

They will continue to listen and watch for your communication to them. Your communication gears them to justify and stimulate a purchase. If you can develop a lower cost solution, this may just be the time to do so to help maintain that relationship through these difficult times. This will keep them loyal and help to cultivate a stronger relationship in the future.

How to find market opportunity during this time?
It's true our market changes. We come head to head with price wars, stronger competition and less money in the market. There are however opportunities as well. Consider that media revenue deflates during a recessions which means this may be the time to make your product or service known without the high media expenditure. Your competitors will be cutting their budget spend therefore reducing activity, perhaps it's time to punch yours up and gain a larger market share. The price may just be right.

Consumers are looking for loyalty not a one-night stand.

Also see Marketing