During tough times such as these, it’s common for small businesses to trim expenses, the first usually being marketing and advertising. In times when you’re just trying to survive, search engine marketing can seem to be a luxury. You eagerly wait for the day when things begin to turn around to restart your SEO efforts in earnest.
Usually, a recession is cast in a national context – the US economy is doing well, or it isn’t (I think it isn’t. And we need to prepare.) Some businesses, though, are counter-cyclical and can thrive in tough times. But to better understand business behavior, the term recession needs to apply to a specific market and the growth it’s experienced.
If your market is in recession, advertising and online marketing are much more critical.
Research abounds to support this fact – businesses that cut advertising and marketing budgets experience a sharper decline in sales and profits than those who maintain or boost theirs. These businesses were better able to solidify their customer base and strengthen brand image and consumer awareness.
Cutting back (advertising) during a downturn is like throwing away your investment.
Maintenance today costs much less than rebuilding tomorrow.Robert Wilson, Award-winning business writer & speaker
The Strategic Planning Institute, a non-profit Cambridge, MA institute specializing in strategic business management, maintains the Profit Impact of Marketing Strategies (PIMS) system, which tracks over 3500 strategic business units in over 200 companies across North America and Europe.
Data from this resource proves how important advertising and marketing are during economic uncertainty – demonstrating how businesses that maintain their marketing budgets increase their market share during bad times.
The main reason is the decline of competitors, especially smaller ones, who may be unwilling to defend against more aggressive firms.
During times of economic expansion, some companies are eventually not able to serve a certain market – opening the door to competition. Hence, a strong business may lose market share despite satisfactory unit growth.
A study by Cahmers Publishing Co. evaluated a wide range of companies from the 1981-82 recession and found that companies that boosted their marketing expenditures by 28%-80% experienced a 1.5% jump in market share, while a company that decreased their marketing budgets only saw a 0.2% increase.
In a typical environment, a company only saw its market share increase by 0.2%, no matter whether its ad budget went up or down.
The pitfalls of cutting advertising and marketing budgets during a recession
Cutting advertising and marketing budgets during a recession may seem like a quick way to save money, but it can have several negative consequences for your business.
Here are some reasons why you should avoid reducing your marketing expenses:
- Cutting marketing expenses may provide short-term savings, but it can also reduce revenue in the long term as your competitors gain market share.
- It is important to maintain a presence in the market and remind your customers of your brand, especially during difficult times.
Loss of market share
- Reducing advertising and marketing budgets can put your business at risk of losing market share to competitors who continue to advertise and promote their products and services.
- If customers are not reminded of your brand, they may forget about your business and switch to your competitors who have maintained their marketing efforts.
Damaged brand awareness and customer loyalty
- Cutting marketing budgets can damage brand awareness and customer loyalty. When businesses reduce marketing efforts, customers may perceive it as a sign of weakness, leading to decreased trust in the brand.
- If a business’s marketing efforts are reduced, it can also be interpreted as a lack of commitment to customer needs and wants, leading to a decline in customer loyalty.
Marketing in a downturn should be considered a contributor to profits, not a drain.
Now is the time to start or increase your online marketing efforts – let people know you’re there.
Your website can be quite a valuable tool to reach millions of potential customers. And a cost-effective one, at that. You can save on marketing dollars and gain more brand awareness than through other, more traditional advertising mediums.
Remember though, not all websites are created equal (obvious fact, yes, I know.)
Pat’s Take: Impression Matters
I have come across exceptional attorneys, top performers in their field, who unfortunately have websites that are stuck in a time warp. While I understand their priorities may lie elsewhere, it’s so important to recognize the significance of a strong first impression. Your website serves as a virtual representation of your practice, and its outdated appearance will lower prospects’ confidence.
Optimize your website architecture, content, and link building for search engines to get the most from your online marketing efforts.
Search engine optimization is a process by which a website’s traffic volume and quality are enhanced by natural search engine results. An optimized site is easily and consistently updated with informative content – serving as a trusted resource for customers in the research phase of the buying process.
It’s the job of search engineers and online copywriters to identify valuable keywords and produce keyword-rich content that is useful to consumers at any stage of the buying process – coordinating various online communication components like articles, press releases, blogs and social media to accelerate rankings and bring qualified traffic to your site.
A consistently updated website help improve search engine rankings. It lets people know you’re actively engaged in your industry and builds trust with prospective customers in the buying decision’s research phase.
While it may be cheaper in the short term to neglect your site, the longer-term cost to your brand and profits makes neglecting your website quite consequential.
The benefits of maintaining or increasing marketing efforts during a recession
While it may be tempting to cut back on marketing expenses during a recession, research has shown that maintaining or increasing marketing efforts can benefit your business in the long term. Here are some reasons why:
How to capture market share to increase brand awareness
When your competitors cut back on their marketing efforts, it creates an opportunity for you to stand out and capture a larger market share. By maintaining or increasing your marketing efforts, you can improve your brand awareness and attract new customers who may have been loyal to your competitors.
Some effective marketing strategies during a recession include:
- Email marketing campaigns
- Social media advertising
- Video marketing
- Search engine optimization
These cost-effective methods can help you reach your target audience and increase your brand visibility.
Emerging stronger than competitors
When the economy eventually recovers, businesses that continue to market themselves during the recession will be better positioned to take advantage of new opportunities.
By maintaining your marketing efforts, you can maintain a strong customer base and increase brand loyalty, putting you in a better position to recover and grow when the economy improves.
Additionally, by continuing to invest in marketing, you demonstrate to your customers that your business is still active and committed to providing value to your customers. This can increase customer confidence and trust in your brand, ultimately increasing sales and profits.
How SEO enhances marketing efforts during a recession
Investing in cost-effective marketing strategies such as SEO can help maintain or increase your marketing efforts, especially during a recession.
Improved website traffic
SEO helps optimize your website for search engines by targeting specific keywords your customers are searching for.
By ranking higher in SERPs, you can attract more organic traffic to your website, leading to more leads and sales. This increased traffic can be particularly beneficial during a recession when businesses may be experiencing a drop in sales.
Increased brand awareness
SEO can also increase brand awareness by making your business more visible online.
When your website ranks higher in search engine results, more people will see your business name and logo, which can help to establish your brand in the minds of potential customers. This increased visibility can be significant during a recession when businesses struggle to maintain their market share.
Targeted marketing efforts
One of the main benefits of SEO is that it allows you to target specific keywords and supporting phrases relevant to your business.
By doing so, you can attract more qualified leads who are more likely to be interested in your products or services. This can help improve your leads’ quality and increase your conversion rates, even during a recession.
SEO is a long-term investment in building brand awareness and customer loyalty. You can establish your business as a trusted authority in your industry by consistently producing high-quality content, optimizing your website for search engines, and promoting your business online. This can lead to increased customer loyalty, repeat business, and referrals, which can help your business to thrive even during tough economic times.
The dangers of neglecting your website and SEO during a recession
Neglecting your website and SEO during a recession can be costly for your business.
While your competitors are plowing ahead, you pause your SEO campaign. They have the momentum, and you just lost yours. It will take time for you to pick back up.
A neglected website can signal the end of your business
An outdated and poorly maintained website can give the impression that your business is no longer active or relevant. This can lead potential customers to assume that your products or services are no longer available or that your business has shut down altogether.
In a time when customers are looking for stability and reliability, a neglected website can cause them to look for alternatives.
Poor SEO can lead to lost sales and revenue
If your website is not optimized for search engines, potential customers may be unable to find you online. This can lead to lost sales and revenue as customers opt for businesses that appear at the top of search engine results pages.
Additionally, visitors may quickly lose interest and look for other options if your website is not mobile-friendly or has a slow loading time.
Neglecting your website can damage your brand reputation
A poorly maintained website can also harm your brand reputation. Customers may perceive a neglected website as a sign of unprofessionalism, leading to losing trust in your brand. This can lead to negative reviews, reduced customer loyalty, and a damaged reputation that can be difficult to repair.
The importance of consistent SEO efforts
Consistent SEO efforts are essential for maintaining and improving your online presence. SEO is a long-term investment that requires ongoing attention and effort.
Maintaining and monitoring your SEO during a recession can prevent your website from slipping in search engine rankings.
If your business operates online, embracing the power of SEO becomes even more crucial. Search engine optimization is the key to establishing your digital presence and ensuring your website is discoverable through organic search.
While pay-per-click (PPC) advertising can yield quick results, it often comes with a hefty price tag. On the other hand, organic listings achieved through effective SEO efforts offer a more cost-effective and sustainable approach to driving conversions.
Remember, SEO is a long-term investment. It requires patience, consistent effort, and adaptation. Staying visible and maintaining your online presence is critical, even during challenging times.
While adjusting your marketing budget is a decision you must make based on your unique circumstances, understand the potential impact of reducing or pausing your SEO activities.
Rather than abandoning your SEO efforts, consider finding a balance between budget constraints and the need to maintain your online visibility. Explore cost-effective techniques, prioritize organic search, and leverage the power of SEO to enhance your online presence. Doing so allows you to navigate through challenging times while setting a solid foundation for long-term success.
If you’re looking for help with your search engine marketing, welcome to SEO Advantage. Let us know how we can help.
SEO is just one piece of a digital marketing puzzle. We understand the importance of a well-rounded approach to marketing and how search engine optimization fits into the bigger picture.