Our economic troubles are hurting deeper than the punch from the gas pump, bruise from increased tuition costs, and stabs from the job market. These economically challenging times are also abusing the fundamental business principles that companies have relied on for years. In particular, these bad financial times are changing the way advertisements are valued.
Many companies assume that when they are affected by hard economic times, it is best to pull the plug on various advertisement campaigns as a way to cut marketing costs. However, this kind of penny-pinching seems to only make the struggling financial situation worse. According to a study prepared for American Business Media by Yankelovich Partners and Harris Interactive, businesses who continue to run ads have a significant competitive advantage over those who choose to cut back.
Simply: there is a value to spending money on advertisements, regardless of economic struggles.
Darwin’s theory of “survival of the fittest” has never been so true in today’s economic downfall. Companies cannot risk pulling their advertising from the marketplace if they want to remain in the thoughts and minds of consumers. If only the fit survive, then a company should use aggressive advertisements and marketing strategies as a way to not only reach their audience, but to intimidate the competition. The continuation of building clientele through running advertisements establishes an image of loyalty, faith, and stability a company has in their product or service to the consumer. If the advertisements get pulled, then so will the opportunity to reassure to consumers that the company is prospering despite the economic hardships.
If a company is facing the decision to pull advertisements as an attempt to adhere to budget cuts, it would be wise to think beyond the element of monetary cost. Because the cost of losing attention could be larger than the amount of money you may be saving without advertisements.
-Oliver Evans, Sally Shupe, Jared Sales