It’s common knowledge that the first casualty during a recession tends to be the marketing budget.
All the best advice provided from around the world tells us that this is not the time to cut advertising. Rather, if brands increase advertising during a recession, (when competitors are cutting back), their market share can improve, and more specifically, enjoy return on investment at a lower cost than during good economic times.
We also know that consumers are poorer, or feel poorer, and will be more cautious as to where their hard-earned cash goes when times are tough. Out of home advertising provides this reassurance: it is omni-present, provides big brand stature and endorses key brand values that consumers need to be reminded of when they’re counting their pennies. This is most definitely the time, and the place, to out-shine competitors,
When budgets are strained marketers need to be sure that their advertising is cost effective, is reaching the correct market, and more specifically, retaining top-of-mind awareness.
Out of home truly comes to the fore in these times, yielding higher campaign efficiencies than other traditional media which are grappling with increased fragmentation and higher cost per thousand metrics.
Uncertain consumers need the reassurance of known brands, and the new OMC’s Road Survey findings prove that you are able to reach up to ten times more people for the same cost as a TV campaign. Out of home, due to its immediacy and high reach, provides tactical, promotional and competitive messaging in an instant to focused target markets or broad masses. All of this, for less.
Alongside the cost-effectiveness that out of home provides, brands in a recession are able to negotiate more favourable advertising rates from media owners, thereby allowing them the ability to maintain frequency and provide more tactical and impactful out of home advertising.
All this is endorsed by Stephen King, who back in 1990, published a pioneering study on advertising spend during a downturn. His conclusion was simple: Businesses which cut advertising would be long-term losers. The study reinforces that cutting advertising spend to increase short term profits doesn’t work, but instead reveals that by only moderately increasing advertising in a soft market, market share can increase.
Makes sense. The higher your market share, even in a recession, the higher your return on investment.
Lyn Jones is regional manager of In Touch Media.