The economy is affecting every organization, and we're all looking for ways to tighten our belts. Should cutting down on marketing efforts be one of them? In this issue, find out what faucet marketing is, and why your business should—or should not—practice it.
What is faucet marketing, you ask? Faucet marketing is a business strategy that turns marketing investments on and off as the economy goes up or down. Now that you know what it is, the next question is, are you doing it? If you are, expert opinion says you should seriously reconsider. The fact that our economy is currently experiencing a downturn is not a reason to decrease marketing expenditures; in fact, it dictates the opposite approach—a maintenance of, or increase in, marketing investments.
Long-Term Bottom-Line Impact
According to a recent article in Advertising Age, cutting marketing outreach will save money in the short term, but have disastrous consequences over the long haul. It is well researched and documented that organizations that lose or diminish visibility during a recession have a steeper hill to climb to reach previous levels of recognition status when they want to resume marketing efforts. Worse still, while those faucet marketers were cutting back, their competitors (who maintained or increased marketing expenditures) have garnered a greater market share. Still, most organizations are short-sighted when it comes to their budgets. Let us dispel some of the most common myths about marketing during a recession.
The Myths... and the Facts
Myth: My business is too small for marketing.
Fact: According to a study by the Kelsey Group, as a group, SMBs spent about $110 billion on marketing last year.
Myth: I just can’t afford marketing right now.
Fact: Yes, you can. You don’t have to do everything at once. And gone are the days (for the most part) of the large advertising firm monthly retainers whether you use the service or not. Most firms that focus on marketing for SMBs know that you don’t need/can’t afford a full-time marketing professional. Instead, SMBs need to pay for the work performed by the hour or on a price per project model, both of which are more cost-effective for your business.
Hopefully, we've challenged a couple of your preconceived notions. Now let’s talk about why all this matters. (Hint: It has to do with how people in today’s recession—your potential customers—spend their time.)
Why It Matters
Rather than arbitrarily slashing your marketing budget, tough economic times call for a re-evaluation of your marketing plan to see what is working and what is not—and what cost-effective additions or alternatives could supplement your strategy. In today’s environment, there are two areas to which you should consider devoting marketing money and resources: (1) your website and (2) your search engine rankings. Here’s why: According to a 2008 article in ComputerWorld, Internet users in the U.S. spend an average of 15.3 hours per week online. 80 percent of the Internet users 17 years of age and older said that the Internet is a more important source of information than television, radio, or newspapers. 43 percent said they look for information about various products and services on the Internet and 21 percent of users have a specific search engine dedicated as their home page. What does this mean? It means that people are using the Internet—a lot. This usage increases during a recession because people are:
- looking for easy and cheap sources of entertainment
- constantly investigating employment opportunities
- searching for deals on products and from service providers
What You Should Be Doing
Ok, so you know people are spending lots of time on the Internet. That’s why you should consider spending marketing money on enhancing your organization’s website and search engine rankings. But how?
- First, make sure your website is in tip-top shape and communicates the right message about your organization. Is the tone right? Is the text persuasive -- brief but informative, engaging? Is the design compelling? Is the navigation structure intuitive? Is your website a place where people want to go, stay, and return to? Check out our Optimal Impact that talks about creating a top-notch website (link to this OI).
- Secondly, get your website search engine optimized. Commonly referred to as SEO, search engine optimization is the process of improving the volume or quality of traffic to a website from search engines like Yahoo!, MSN, and Google. Typically, the earlier a site appears in the search results list, the more visitors it will receive from the search engine. Internet marketers strive for this higher page rank when implementing SEO strategies. This means that with a well-executed SEO campaign in place, your organization will appear before your competitors on search engine results pages.
According to Kaysha Kalkofen, co-founder of St. Louis digital marketing firm, tSunela, “...For both small-and large-budget marketers, site or page sponsorship and SEO were considered the most effective ways to build a brand online. People use search engines year round, for all product and service types, and they continue to use them in a down economy.” Kalkofen continues, “In a down economy, a company needs to reach as many consumers as possible (before their competitors). Search engines are the best tool available to reach your target consumers when they are actively looking for what you provide.”
Last Word
A recession can mean an opportunity for many small-to-mid-sized organizations. It can mean an opening in the marketplace to gain market share while competitors have slashed marketing budgets. But you have to be smart. Invest your marketing dollars into the initiatives that have historically helped your organization grow and the Internet strategies that will help your organization thrive in a recession. This means enhancing your web presence with a killer site and a great, ongoing SEO campaign so that potential customers find you first.
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