Data Says You Shouldn’t Stop Advertising In A Downturn
Don’t stop advertising in a downturn: the prescription is borne out by data from previous recessions. And some data shows that actually increasing advertising during a recession (assuming you have the resources) leads to significant business results long-term.
Let’s take a closer look at the data below, as well as your best alternatives to “going dark.”
Stop ads now and risk a 5-year-long recovery, research suggests
The upside of continuing to advertise during hard times
- 1930s: Kellog continues to advertise throughout the depression unlike their cereal rival Post. Post gets crushed, while Kellog and it’s newly-unveiled Rice Krispies brand drives an almost 1/3rd increase in profits.
- 1970s: Toyota barely trails Honda in fuel efficiency in a US report. Recession hits. Toyota’s selling everything it produces based on product strength alone, so executives are tempted to reduce ad spend. They decide against reductions, Toyota sticks to plan, and by 1976 it surpasses Volkswagen as the #1 US import vehicle.
- 2008-2009: Amazon invests in product innovations , continues to double down on growth, and reaps the rewards: 28% sales growth despite a global recession. No surprise, the same company is poised to come out far ahead from the current crisis as well.