With stores closed and consumers experiencing financial hardship or unable to spend even if they are employed due to being quarantined, businesses are facing revenue reductions up to 90% or in many cases, are completely unable to generate sales. Businesses then are making hard choices during the Coronavirus pandemic by laying off staff, cutting expenses and focusing on survival.
One of the expenditures that businesses are considering in these cuts are marketing funds. As a marketing firm, it may surprise you that not only do we understand these business decisions, but agree with them in many cases.
But to understand the issue, we have to look a bit deeper and consider a business’s strategic position in their market. And to start, we have to understand the difference between marketing and advertising.
The Balance’s Laura Lake created an excellent article on this subject, and we recommend checking it out for a full understanding of the differences and (more accurately) where advertising fits into marketing. Check that out here: https://www.thebalancesmb.com/marketing-vs-advertising-what-s-the-difference-2294825
The short answer is that it may be a good idea to pause advertising, it’s probably a bad idea to stop marketing, though for some businesses, stopping everything may be necessary.
So how do you determine the right decision for your business? Ask yourself the following questions:
1. Do You Plan to Survive Post-Crisis?
This is the most obvious and important thing for businesses to ask. It is a reality that many businesses are not going to survive the economic disaster created by coronavirus. Many are in survival mode, often dipping into personal funds to support operations. If spending on marketing will truly result in ruin, stop. For you, paying staff, rent and utilities are the important concerns. Tomorrow, much less Q3 are in doubt and it will do the economy no good for you to no longer be in business. The 99% of the US economy that depends on small businesses to survive understands the importance of your triage decisions.
If however, times are lean but you plan to not only survive, but expand and grow, read on.
2. Can you sell now?
If you can sell product, strongly consider digital advertising right now. Seriously. Right now. Stop what you are doing and either give your agency a call, or talk to your marketing director or get underutilized staff trained and get advertising. Digital media is cheap right now. Probably the cheapest it is going to be for a long time. People are consuming digital content at home, and it costs very little to reach them via Google Ads or Facebook given how so many businesses have made the (correct for some, incorrect for others) decision to cut digital advertising spend.
If you can’t sell right now, but you plan to survive and grow, don’t advertise in the traditional sense. Direct digital advertising to drive sales should always be part of a greater, more comprehensive marketing strategy and in current conditions, that marketing strategy should be helpful and brand focused. We’ve got some tips on how to do that here: Stay In Touch. Stay Relevant. Stay Strategic.
3. What are your competitive market conditions?
What are your competitors doing? If they are doing what we described above, they will emerge stronger. Take this opportunity to evaluate your marketing in comparison to your competition. Are there new markets available to you now? Are there products that can be in development now that can be sold during economic recovery? Be proactive and find opportunity. Your competitors are.
Is this an opportunity to expand your customer base? The economy will change as a result of the crisis. Customers will be displaced and those who would have been difficult to attract will become available to you. Now is the time to become their brand. Being a part of their community now will have repercussions in the future. As many business leaders have noted, the companies who focus on people now will emerge successfully during recovery.
4. Have you neglected marketing that you have not had time or resources to do until now?
Fix and update your website. Evaluate your social media goals. Revisit your complete strategic marketing plan. As the economy recovers, that time is going to vaporize again and the same issues will reemerge. Evaluate the user experience of your website. Is it easy for customers to find what they are looking for? Is it easy for them to find answers? Reassess your social media approach. Research the use of Instagram’s IGTV platform to become more than a business to customers, but an expert. Evaluate your brand. As your business emerges from the crisis, what is your brand positioning statement, what are your brand values and what does your company’s visual identity portray?
Business owners face many challenges currently. And difficult decisions are being made every single day. For businesses who face immediate closure, marketing and advertising are an unfortunate casualty in the fight to survive.
For businesses who are able to focus on the future, the opportunity cost of not marketing is too high and should be considered in decision making. Many businesses will be looking back on what was a chance to better position themselves due to the dramatic changes brought upon by the crisis.
One way or the other, as a small business ourselves, we are rooting for you. And we are here to help if you need us.