"When times are good you should advertise. When times are bad you must advertise.”

In recent months, the cost of living in the UK has risen and continues to increase. With everything becoming more and more costly, businesses are beginning to suffer, and it may not be long before the newspapers and media outlets broadcast that we are in a recession.

Although a recession can be scary for most, there’s no need for businesses to panic and give in to the scare-mongering that will be pushed. In fact, this is the perfect time to boost opportunities and take advantage. Sergio Afonso, CEO of Absolute Translations shares his expertise.

Across the Globe

Despite the declining economy in the UK, markets throughout the world are thriving. Businesses expanding overseas may just save them from potential economic damage, allowing them to almost recession-proof themselves. Many UK businesses may not consider global expansion as an option; however, big and small businesses alike are starting to realise that ‘local’ doesn’t just mean ‘local’ anymore. Usually, brands may steer clear of reaching across the pond, but this is because they haven’t been given the right tools to thrive in those environments.

Utilising translation services can have a huge impact on how business fares during this time and can help companies to take control of the direction they’re heading in. By translating their marketing, product information and more into as little as 12 languages, businesses can effectively interconnect and branch out to 80% of the globe, opening up a wider consumer market.

Planning

In such times of economic hardship, it is vital to plan before it is too late. Right now, we are ahead of the curve which can benefit businesses greatly. This is the time to find amazing people to join teams, to win contracts that others may be pulling out of due to fear and to even get special deals on supplies. 

In the coming weeks, it is important that businesses prepare themselves not only economically, but also mentally to ensure they go from strength to strength. Staying focused on business goals and ignoring the whirlwind can make all the difference. Brands should be utilising translation companies to plan ahead and ensure they are able to effectively communicate with potential overseas partners.

Is cutting in Marketing the right thing to do?

When a business needs to make cuts to weather an economic storm, marketing budgets are almost always first on the list.

After all, spending big on marketing can seem counterintuitive when customers are spending less and revenues are down. That’s when, on the surface, big marketing budgets can become difficult to justify – even for the biggest of businesses.

Take 2020, for example. Marketing spending plummeted to the lowest levels in over a decade, just as around 255 million full-time jobs were lost across the globe.

Against that backdrop, it’s not hard to see why spending money on encouraging customers to open their wallets became less of a priority. If even Google had to cut its marketing budget in half, how could other businesses afford not to do the same?

But no matter how logical it might seem, is it always right to make marketing budget cuts?

There are several reasons to advertise during a slowdown. 

1. The “noise level” in a brand’s product category can drop when competitors cut back on their ad spend. It also allows advertisers to reposition a brand or introduce a new product.

Because above all else, there’s less competition.

2. Brands can project to consumers the image of corporate stability during challenging times.

3. The cost of advertising drops during recessions. The lower rates create a “buyer’s market” for brands. Studies have shown that direct mail advertising, which can provide greater short-term sales growth, increases during a recession.

4. When marketers cut back on their ad spending, the brand loses its “share of mind” with consumers, with the potential of losing current – and possibly future – sales. An increase in “share of voice” typically leads to an increase in “share of the market.” An increase in market share results, with an increase in profits.

5. Best time to stand out by running a strong content marketing campaign, while your competitors advertise less.

What should you do to cut costs but maintain or increase your marketing budget and results?

1. Getting rid of unnecessary marketing software and tools.

2. Freezing new product launches and updates

3. Analise where what channels are bringing the most clients and keep those channels running only, maybe even consider increasing the spend on those channels only.

4. Outsource your marketing and reorganising your team to focus on converting the leads the marketing agency will bring instead of doing the marketing themself. What that means is you need to focus on converting old and new leads more than bringing them.

Although the natural inclination for advertisers is to cut back on advertising during a recession, those brands that maintain their ad budget and/or change their messaging can get a long-lasting boost in sales and market share.

Perhaps the best quote about advertising in a recession came from Sam Walton, the founder of Wal-Mart. When asked, “What do you think about a recession?” he responded, “I thought about it and decided not to participate.”

Resources:

"We are officially in a recession, as explained by an expert", Sergio Afonso, CEO of Absolute Translations

Forbes.com

Mili Ponce

Former Computer Engineer, Tech, EdTech and eCommerce Entrepreneur, Keynote Speaker on Digital Marketing and Entrepreneurship, Social Media Strategist, eCommerce Business Mentor, Trainer, Writer, Blogger, Mother, Daughter, Dreamer.

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