2025 Advertising During Uncertainty: Flipping the Switch on Your Advertising
Have you ever asked, “What would happen if we just stopped advertising?” When uncertainty – or worse, fear –enters the marketplace, the easiest place to look to cut your budget is marketing and advertising. It’s one of the easiest switches to flip, because no one in the organization loses their job.
It’s also short-sighted.
Just like killing one engine of a four-engine plane, pausing your advertising won’t have immediate effects. This can make it feel like a safe move that you can make quickly. You might say to yourself, “Maybe the economic uncertainty will clear up in a month or so, and we will just turn everything back on again.”
However, like the glide path of the plane, stories from the last two recessions tell a different tale about companies' outcomes based on how they responded to market uncertainty.
We prefer to make our own mistakes, thank you
You can avoid marketing landmines by learning from the mistakes or successes of others:
- On average, pulling the plug on advertising results in a 16% drop in sales in the first year, and a 25% drop after two years (What happens when brands stop advertising? | Ehrenberg-Bass Institute for Marketing Science)
- Brand awareness also tanks – a 6-month absence from TV can reduce total brand awareness by ~39% (Global study of 25,000 consumers gives brands clearest direction on how to stay connected in a pandemic world).
- By launching and sustaining marketing during The Great Recession, IBM’s revenues in “Smarter Planet” solution areas grew over 20% annually during the downturn, avoiding the deep cyclical slump that hit the tech industry – its earnings and margins improved through 2008–2012. (A strategic view on smart city technology: The case of IBM Smarter Cities during a recession).
Don’t be THAT footnote in history
Do you remember GoToMeeting? Don’t feel bad, because it’s become the Kodak* of the pandemic recession. Zoom and Webex committed to marketing during that period of instability and outstripped the entrenched leader in the video conferencing space. (*Kodak was a photographic film company that sealed its fate by insisting that digital cameras would never catch on.)
When you pause your marketing, you create an information vacuum. That vacuum will be filled either by misinformation about your company's viability or, more likely, by a competitor with more courage and better planning.
As the old adage goes, “When times are good, you should advertise. When times are bad, you must advertise.”
When adversity is opportunity
In our industries (B2B and ag), sales cycles can be long to begin with, so recovering momentum after going dark can take four or five times as much treasure and runway as maintaining a consistent level of marketing.
If your competitors press the easy button, thank them for the opportunity not just to tread advertising water, but to retool your messaging or overall strategy. Do your customers need something different now? What can you do to meet their new needs? Evolving your business to be an even more trusted resource during this time can propel you further when things begin to accelerate again.
It seems counterintuitive when things are uncertain, but there’s plenty of upside and market share available if you can resist the temptation to contract.
If you’d like to talk about ways we can help your team find the opportunities in this cycle, we’d love to show you how we can help!