Should I market during COVID-19


Should I market during COVID-19

07 Apr 2020

Business is slowing down and if it hasn’t yet for you, it will likely in time.

We’ve seen some great examples of businesses pivoting and some other winners from the isolation of the majority of the planet, but for most of us we’re in for some hurt.

“Simon, what should we do with our marketing?”

Not surprisingly this is a common question I’m getting in the last couple of weeks from our small business clients. We are in for a decline, a likely recession of some description. So we, as business owners need to make strategic decisions now more than ever about how we spend our money and what we do with our marketing budget. We need to consider – the ‘right now’ and ‘once the virus is over scenarios, so let’s break it down.

Right now, there’s actually not a whole lot of options. You can either…

a). Stop all spending, bunker down, ride it out and join back in once its over, or

b). Keep spending and/or even increase spending

How could we possibly increase spending?

Option b of course depends on whether you’ve got enough cash to continue or increase your spend. That’s likely going to depend on how your business has been impacted so far and your projections. Initially, it could depend on your ability to innovate, as well as whether you will ‘back your business in’, retain your staff and continue the journey. We’ll go into ‘why’ you might want to increase spending in a minute.

If there is a recession, what would be the impact of stopping your marketing spend? There is obviously a cost saving to reducing the marketing spend. However,  there’s been recessions before and there’ll be recessions again and fortunately, this means that there is plenty of data available to help showcase the relationship between advertising and business performance – in hard times. What does the data tell us? The data is pretty consistent, and the findings are clear – those who dare win. You are not guaranteed to win, but you improve your chances of recovery.

“Businesses who held constant or increased spending consistently outperform those who don’t, in the immediate and future periods”

Why? Advertising can create both an immediate response, as well as lasting brand recognition benefits. This is often referred to as ‘share of voice’. So if your business is still trading, an immediate response is all well and good. However if you are unable to deliver your regular services, a brand recognition campaign would be the best strategy for you, ensuring you stay front of mind for customers now and once the virus has passed.

Share of voice is a measure of the market your brand owns compared to your competitors. Various studies find that there is a consistent relationship between share of voice this year and market share change next year

Many businesses allocate a portion of sales or turnover towards their marketing budget, so when times are good, these businesses have healthy budgets. Conversely, in harder times, these businesses are likely to reduce their spends. When this happen at scale, there will be fewer businesses advertising, creating opportunities for others to stand out and increase their market share.

Turning the tap back on after the pandemic has passed could be too late. Your business will have lost ‘share of voice’ which is correlated to market share. 

Once you’ve decided to keep investing, it’s time to think about the method and messaging. We’ve clearly seen a change in the buying behaviour with the move to online. People are unable to shop in stores so you need to come to the customer in other ways. We’ve also seen a change in consumption with huge cuts to discretionary spending on clothes and other luxuries.

Furthermore, we believe the messaging people are responding to has also changed. With so much hardship in local communities initially from the bushfires and now with COVID-19, there’s a shift towards supporting local and perhaps more appreciation of family. Think back to the #emptyesky campaign. This provides a fantastic opportunity for quality local businesses to compete against the bigger players. It’s important that brands understand and adjust their messaging from selling, to helping.

What’s stopping you?

Well you’ve obviously got to have the cash to spend, you still need to be able to deliver your product or create lasting awareness and you will need to put a plan together.

We believe marketing is a crucial component of success for almost all businesses and sincerely hope this article assists with decision making for small businesses. We’ll back in our business and continue to invest in providing our customers with actionable advice to keep them going during these hard times. If you’d like to discuss your marketing strategy we can help.

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