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Study shows businesses who advertise are perceived successful |
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TeamBiz Editor | A recent study by Ad-ology finds that advertising appears to play a key role in consumers'
view of how a business is doing, and by not advertising, businesses may
be sending a warning signal to current and potential customers. Over 48% of U.S. adults believe that lack of advertising by a retail store, bank or auto dealership during a recession indicates the business must be struggling, according to the research. This is not a good sign for those who decided to cut their advertising budget as an attempt to save money. “It is critical to advertise in the current economic climate, to maintain long-term positive consumer perception of your brand... Advertising not only assures consumers of a business' reliability in a soft economy, but it can influence where and what they buy, especially when the ads address concerns about value” said C. Lee Smith, president and CEO of Ad-ology Research. Other interesting findings include:
Have you reduced, maintained or boosted your advertising budget since the recession started? What impact do you think it had on your business? |
Last edited May 25, 2009, 3:04pm by author | |
 | I think this issue manifests itself rather differently for businesses of various sizes and industries. Most small businesses rarely advertise enough for anyone to notice any cut-backs. And they usually have the opposite, healthy reaction to tough times: they look for ways to increase their exposure, to "get the word out" more. The biggest caveat is about the quality of that exposure. Trying to do too much on an unrealistically small budget leaves them overextended and inefficient. They end up wasting their money and reaching the conclusion that "this [insert advertising channel here] thing doesn't work for my business". That brings me back to the question about the advertising budget. Size matters, but is secondary to your attitude towards advertising. If you see it as an expense, you'll try to cut costs and delude yourself that you're "stretching the dollar", when in fact you're wasting it. If you see it as an investment, you will be more concerned with efficiency (ROI) than cost. What would you rather do with your money: flush $100 down the toilet, or invest $10,000 in a way that you are confident will bring it back multiplied. |
Emily Green | That's a great point, Alex! Couple of days ago, I talked to a new client complaining about lack of results from a campaign they implemented themselves. High-end merchandise advertised on low quality, self-printed paper... it looked like a school project (a bad one!). Direct mailing cost a fortune anyway - money wasted because of the poor understanding of the target market and their obsession with "low price". Bottom line: Advertising costs. Advertising with no results costs even more! |
Sarah Jarvis | I think there will always be businesses more concerned about cutting their costs than increasing their advertising, regardless the economic environment. There are many ways to advertise a business, on-line and off-line and some don't require a large budget, just an open-minded management. |
Last edited Jun 18, 2009, 7:56pm by author | |
 | Alex makes some great points. Our business is a little different, certainly we have different target groups for clients. For example, Traffic Ticket defence is almost completely retail based, so standard advertising works, i.e. Signage, Yellow pages, newspaper, internet. My ultimate target market for Small Claims is B2B..... Elizabeth, our lawyer, is focused on developing her Criminal Law/Civil Litigation practice. In each of those areas, we have different target clients.... Bruce |
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