PR is a valuable and cost-effective way to keep your company visible. As other businesses cut their communications budgets, take advantage of the void in the information marketplace and grow your brand.
How PR Helps During a Recession
Recession. It’s a word nobody likes to hear. Unfortunately, as markets go up, they also come down. Recessions, as uncomfortable and challenging as they are, are a normal part of the economic cycle, happening every 5-6 years on average. In fact, there have been 22 recession since 1921. The good news is they don’t last forever and the prosperity following an economic downturn has historically been higher than the previous peak.
During a recession, consumers tend to cut back and hoard their money. When times get better, they are ready, willing, and able to spend. With that in mind, it’s important to make business decisions for the long-term gain and not quick fixes for the short term. You want to make sure that when consumers are ready to spend, they remember who you are.
For this reason alone, cutting your public relations budget during a recession is a serious mistake. The decisions your company makes now can be the difference between coming out on top or watching your market share fall.
PR Makes a Difference
Keeping Your Name Alive
Keeping your name and image out there during a recession signals to your customers and prospects that your business is alive and well. You’ll remain top of mind with consumers and maintain your place in the market. Drop out of the public eye and customers will wonder where you’ve gone.
More Media opportunities
As your competitors pull back their PR efforts, it opens the door for you and your company to fill the void. Media outlets will still be looking for interesting stories to tell and for industry experts to rely on. Staying true to your PR strategy will gain you additional media opportunities now while solidifying these relationships into the future.
It’s taken some time to perfect your message and get it out to the public. Any interruption means you’ll be starting again. You may be top of the market now, but a few months of silence and people will be asking – “Who are you?”
In times of trouble, you want your friends near. Building a loyal customer base can go a long way to sustaining a business through tough times. If you’ve had a solid PR plan in place, you’ve already been creating brand loyalty. If not, take advantage of the void left by companies cutting back to develop relationships with new consumers.
Public relations is still one of the most cost-effective ways to get your message out to a target audience. A well-placed industry guest article can earn you enormous exposure and position you as a trusted and reliable expert in your field.
In it for the long haul
Public relations is a long-term effort to build brand awareness, image, and reputation. That doesn’t happen overnight. Sticking with your long-term plan will ensure that your efforts play out with increased exposure and consumer loyalty.
History Tells the Tale
History has proven that companies who continue to market during an economic downturn reap tremendous benefits.
- 1920 Ford was the number one automaker outselling number two Chevrolet ten to one. During the great depression, Ford cut marketing while Chevrolet increased. By 1935, Chevrolet was number one.
- 1990-1992 Reebok was the top seller of training and athletic shoes. During the recession, Nike tripled its marketing spending, while Reebok cut back. When the recession ended, Nike’s profits were nine times higher than Reebok. The market share and consumer loyalty Nike gained during those two years continues to keep them at number one, untouched by other competitors.
- 1990-1991 Wal-Mart continued to open stores across the Midwest, making it the fastest growth period in company history. The company posted double-digit profits and moved ahead of any competition. While others worried and cut back, Wal-Mart forged far ahead of the competition.
- 1990 Companies like Jell-O, Crisco, Hellmann’s, Green Giant, McDonald’s and Doritos cut their marketing budgets and saw sales drop 26% - 40%. However,Kraft, Jiff, Bud Lite, Coors Lite, Pizza Hut and Taco Bell grew 17% - 70% due to aggressive marketing efforts during the recession.
Navigating a recession isn’t easy and tough choices must be made but cutting back on PR shouldn’t be one of them. When done well, an increase in PR can not only keep your current market share but build on it. History has shown us that recessions often provide excellent growth opportunities for companies willing to take advantage and increase their marketing and public relations efforts.
Public relations can help you not only survive but thrive in a recession.