Hard economic times have the cruel effect of weeding out weak companies from their stronger competitors. This natural selection is the result of how well companies have prepared for downturns in business or a slowing economy.
Whether it’s a Wall Street investment bank or the auto mechanic on the corner, survival is not only based on how fit a company actually is, but how fit it appears to be. To succeed, a company should have both the actual fitness and the appearance thereof. But in uncertain times, confidence and trust are the two assets a brand cannot thrive without.
If a company has sufficient resources, now is the time to show that it is doing well, even in an uncertain economy. That’s because how you’re doing now is the chief indicator to customers and clients of how you’ll be doing in the future.
Hard economic times and industry slowdowns are thus times for a healthy, strong company to validate its strength. Being highly visible when competitors are running for cover is the fast track to market share. I can think of one client in particular who, when his industry was experiencing a significant downturn, maintained an aggressive ad-spend.
While it didn’t make the phones ring immediately, it did allow him to make a show of strength in an otherwise gloomy business climate. While his competitors hunkered down, he grew in visibility. The net result was that when the market came back, he had the position of strength that big corporate clients were looking for. He outmaneuvered companies many times his size and closed on tens of millions of dollars in new business.
Conversely, I’ve seen companies that are struggling to balance the income statement begin to cut back on customer service, reducing the number employees helping customers. This merely accelerates the death spiral by communicating that the place is going down the tubes.
Certainly a gloomy economy is reason for discipline and even some restraint in a company’s marketing spend. The good news is that it forces more resourcefulness and creativity. That’s why this is a great time for PR efforts. Normally less expensive than paid advertising, PR can promote the healthiness of a company in a sea of otherwise bad news—going a long way toward reinforcing that important appearance of strength.
