Advertising in a Recession?

Jan 05 2009

-Katie McGinty

Money is tight and confidence is low, but every cloud has a silver lining, even if it’s hard to find.

Advertising budgets are always the first to be cut during an economic downturn, and if you listen to the magazine and newspaper sectors, this time is no different. However, there is one big exception. Unlike the recessions of the 70’s, 80’s & early 90’s, there is now a thriving internet segment. Businesses have always concentrated on traditional forms of advertising (TV, radio, print, direct mail). That may be easy when the economy is booming, but when it’s not, there is a greater need to spend wisely. A new advertising arena was born with the Internet and has really evolved over the past ten years. Many companies haven’t taken advantage of online advertising, but for those who are looking for a more targeted and measurable method to advertise, this is it. When compared to other traditional advertising channels, it’s becoming the preferred route in a gridlocked market.

There are many forms of online advertising: banner ads, rich media ads, contextual ads on search engine results pages, video, online classified ads, email marketing, social network advertising and more. Unlike traditional media, where you are bound by publication dates, air times, and regional boundaries, you get an immediate broadcast of content and information that is not limited by time or geography. And, you can begin tracking results instantaneously. If you see an area with low response, you can change it in real time, without having to wait for the next print date. You have control over your budget and your results. Spending at its wisest.

All predictions today show that online advertising will continue to grow as we fall further into recession. The World Advertising Research Centre (WARC) has just released a report that suggests that online advertising will grow by 17% in 2009 and a further 12% in 2010. Here’s why: Online advertising can be tracked, measured, adjusted and tightly targeted. During times when every dollar counts, this is just what the doctor ordered.

The graph below represents spending in online advertising and how quickly it’s predicted to grow in the future.

U.S. Online Advertising Spending

Kelsey manages online advertising for several clients, and each campaign has created a significant increase in online conversions and sales.

Also consider these ways to thrive during a recession:

• Focus on your existing customer base instead of spending more to attract new customers.
• Concentrate on advertising that provides a clear return on investment, such as Internet and specific promotion-based advertising.
• Be ready to cut projects that have a harder time proving ROI, like tradeshows and print ads.
• Use this time to build your brand. Flaunt your company’s stability during rough times, and come out ahead of those who chose to lay dormant.

Staying in the game can be challenging when everyone around you is cutting back. Yet those who continue to show strength by making smarter advertising decisions and keeping their brand in front of consumers will bounce back much faster when the market turns. Here’s to wishing everyone success in 2009.