The brutal truth is that we’re going to be feeling the effects of this pandemic for quite some time. Moody’s Analytics predicts that the economic recovery won’t be a “V” where the economy plummets and then recovers at a similar rate, but rather a “Nike Swoosh” where there’s an initial surge followed by modest, continuous growth. A survey of 176 senior sales and marketing leaders conducted by The Revenue Collective found that 56% of them expect the economic impact from COVID to last at least six months to over a full year. History says, though, that bold marketing leaders that charge through the economic impacts and build their brand will be handsomely rewarded.
There are 100 years of historical indicators, pulled together by ASI, that show the best thing for your company to do during a recession is to double down on brand.
- An issue of Harvard Business Review from 1927 found that companies that continued to invest in brand through the 1923 recession came out 20% ahead of where they were before the recession.
- Across the recessions of 1949, 1954, 1958, and 1961, Buchen Advertising observed a correlation between a reduction in ad spend and a reduction in sales and profits. Importantly, those same companies lagged behind ones that maintained ad spend during the recession once the market recovered.
- In the 80s, McGraw Hill Research studied 600 B2B Companies during the recession and found that businesses that were aggressive about building their brand through advertising grew 275% more than those that didn’t.
- In the 90s, a MarketSense study found that a balance between brand-building and short-term performance programs yielded the best results for coming out the other side of a recession.
- Similarly, The IPA Databank recently found that a 60/40 blend between brand building and short-term response programs generated the best long-term market share results, regardless of market conditions.
Charge Forward with Brand
Obviously, we’re in a difficult period and crafting sympathetic brand messaging is difficult. Remember that we’re going to come out of this, though. Companies that were unafraid to invest in brand and be bold with campaigns during times like these have historically come out the other side stronger and with bigger competitive advantages.
Investing in brand awareness advertising is one surefire way of accomplishing that. At Terminus, we have seen a large surge in targeted advertising from our customers. They are shifting dollars from their event budget for cookie-based advertising so they can still get their brand in front of their most important customers and prospects (who are now at home).
While we recommend following suit and doubling down on your ad spend, simply increasing your volume doesn’t mean your brand will break through such a noisy and disorienting time as this. It means taking big risks and going in a different direction from the rest of your marketplace. To use a suddenly overused phrase, it means “hunkering down.”
In the spirit of talking the talk and walking the walk, I’ll throw out one example from our own team. We executed a pretty crazy April Fool’s Day campaign that, frankly, I was afraid to run in the current climate. We did it, though, and it turned into the second-highest day of traffic in the history of Terminus.com. Pretty amazing, right? Our audience needed a laugh and a light-hearted moment, and we were able to deliver that in a way that was authentic.
Tightening up your brand strategy might be a dangerous game right now. Playing into the fear and uncertainty of your audience might be a losing game. So we challenge you to charge through this uncertain and uneasy present as a fearless and bold company and, history says, you will emerge in a stronger position than ever before.