Budget Tight? Then Advertise!
When money is tight, what’s the best advice for a company? Spend money on advertising! While some people are surprised at that advice, it’s exactly the right thing to do in most cases. Most leaders pull back from media and marketing during challenging times, but that’s the moment you should be advertising the most, because advertising is about recognition and perception.
During difficult times, your problem is awareness – how do you get people to try the product, open the door, or listen to your message? Obviously quality products and great service matter. But without recognition and awareness, those great products just sit on the shelf, churches sit empty, and service companies don’t get calls.
If you’re struggling financially, be very careful about dumping your advertising budget. That could be the very thing that could get you back on track.
In the 90s I worked on a new tv program for a respected evangelist doing incredible work overseas. His new tv show – after 2 years – was easily breaking even. The donors giving through tv were enough to pay for tv production, airtime and expenses. Then the ministry decided to swing for the fences in a new, huge USA literature campaign. But the plan was costing millions, draining cash. Someone crunched the numbers and convinced the evangelist to pull the plug on tv, including laying off good staff. Their tv program had been an advertising vehicle that promoted other ministry projects too. No tv = less promotion. The literature plan went on to be only a fraction of the success anticipated.
The ministry’s pulling back in tough times jibes with Phil’s point superbly. The ministry thought they’d be saving money by cutting tv. When, in fact, they were losing the very donors that were not only paying for tv itself, but were in a position to support the literature campaign too – if only developed properly. These were committed partners – fresh to the ministry – who now were wondering what happened to the great tv show they watched each week…and the solid evangelistic ministry they supported. It was a case of penny wise, pound foolish.
We’ve found the auto segment to still be spending money (they love sports broadcasts like ours…), however…they are MUCH more selective and very difficult to negotiate with now. Even a hint of down numbers has them running somewhere else.
As local stations really struggle with retaining advertisers….they are all dropping their rates, which is good news for the auto marketers. Bad news for regional and national places like ours…where ratings are still strong but we don’t want to drop our rate card.
So yes….they’re adverstising….but able to do so because rates have come down dramatically, especially on a local level.
This is a great post Phil and SO true!
There is a mentality that you advertise in good times and pull back in bad. Sadly – the “bean counter” orientation looks at marketing and advertising budgets as the most cutable item when things get tight. Success is always acheived by those who invest in a sustainable plan.
I would often talk to clients about “brand equity” the way a realtor talks about the value of a house (in normal times of course). It takes time and the longer you do it the greater value. The advertisers who stayed with it almost always came out ahead. Tight times are the BEST time to advertise!
That may be a smart move by the companies, but at the same time they also have to use fair price policy for their products. Because when there is no money in the market how will someone can afford your product, No its not Say’s law applicable here that “supply creates its own demand” Unlless you have a very niche product.Power to back your desire comes with money when there is no money….no demand and ultimately your product will suffer.
How anyone can advertise when there is no funds? People are getting layed off, no hikes wil anyone buy your product even if they want to? Ya it may help in Image building of the company, but only if the product quality is good.from whatever i gather, i think manufacturers produce goods for consumer, But i think its very important question to answer before you satrt advertising thats ” Is this investment in advertising will result into sales? if not is the company ready for making such huge investment for image buliding? ” Does consumer has the ability to buy your product?” After all advertising is does not comes for free.