Tuesday, April 21, 2009
Why Cutting Back on Spending May Be the Worst Decision You Can Make
When hard times hit, most businesses cut back on spending. However, a recent New Yorker article ["Hanging Tough: Financial Page"] uses a real life case study between Post cereal and Kellogg cereal to make the point that investment in advertising and marketing, particularly during a recession when most competitors are cutting their advertising budgets, can be the best investment a company can make in its long term growth. The research has been done...beginning in 1927 when "economist Roland Vaile found that firms that kept ad spending stable or increased it during the recession of 1921-22 saw their sales hold up significantly better than those which didn’t." This lesson clearly applies to commercial districts...now is the time to get smarter about advertising your district and the businesses in your district. When customers are few and far between, it's important that you help your businesses hustle for every customer dollar that exists. For some good marketing ideas, see our recent blog entry "Twelve Tips for a Recession-Proof Commercial District".