When A Recession Comes, Don't Stop Advertising
In recent weeks, there has been some talk about an economic recession. When it comes is still anybody’s guess, but another business slowdown is inevitable. It would be the first since the “great recession” ended more than ten years ago. Often times when a recession happens, businesses, fearful of declining revenue, begin to cut back in various areas, including their ad spending.
In the aftermath of the last recession in 2008, ad spending in the U.S. dropped by 13%. Broken out by medium, newspaper ad spending dropped the most at 27%, radio spending dropped by 22%, followed by magazines with a decline of 18%, out-of-home by 11%, television by 5% and online by 2%.
Nonetheless, there have been a number of studies going back nearly one century that point out the advantages of maintaining or even increasing ad budgets during a weaker economy. Those advertisers that maintained or grew their ad spending increased sales and market share during the recession and afterwards.
As a popular adage says, “When times are good you should advertise. When times are bad you must advertise.”