Periods of economic turmoil also represent the opportunity to deepen your long-term relationships with customers and business partners. It’s important to recognize that when your competitors are scrimping on their public profile, you actually multiply the power of your advertising and marketing budgets—garnering even more awareness per dollar spent.
Snap! Crackle! Pop!
During an economic downturn, it’s the first instinct of many businesses, large and small, to cut back on advertising, marketing, and brand innovation. While this may seem like simple common sense, history teaches us a very different lesson. In 1929, Post Cereals was the leader in its industry, with Kellogg in second place. When the Depression hit, Post hunkered down, while Kellogg increased its advertising spending, moved strongly into new media (radio, at the time) and introduced a major new brand, Rice Krispies. By the time the Depression was over, Kellogg was well on top, where it’s remained ever since.
Different industries tell us a very similar story: RCA and DuPont are among the other companies that focused on new product development and marketing during the Depression, and came out of it in much stronger positions. Demonstrating your commitment and dedication during tough times can increase your standing. When the downturn is over, you’ll be the one reaping the benefits.
Learn more:
The New Yorker: "Hanging Tough"
Wired: "Back to the Garage: How Economic Turmoil Breeds Innovation"
Winthrop Perspectives: "Leading in Uncertainty: Four Proven Principles from History" |
Did you read the article in the cursed New Yorker about Carlos Slim? The way he became unfathomably rich is by snapping up greatly undervalued businesses during lean times.
Always keep a couple few million around for bargain-basement businesses. Then turn them into monopolies. Done!