MARKETING could not be more mission critical in a recession, so why is it that companies’ marketing budget is often the first to be slashed in tough times? In a word, fear.

Fear that there’s not enough “in the pot” to sustain the current marketing spend.

Fear that employees’ jobs may be endangered if marketing spends levels are sustained.

Fear that marketing will make no difference because “customers and clients just don’t spend in a recession”.

Recession provides greater bang for marketing buck
While this fear is not quite irrational, it is most certainly illogical, because the evidence shows when a company cuts its marketing spend in a downturn it cuts its chances of surviving, and of thriving once conditions ease.

Why? Because many of your competitors will view recession as the perfect opportunity to market aggressively, and so steal market share from rivals who are too lily livered to do the same. Cent for cent and penny for penny, marketing spends in a recession deliver a much higher return on investment.

Europe’s largest budget airline Ryanair provides the template for how approach marketing when the proverbial hits the fan.

Ryanair saw 9/11 as an opportunity, not a threat
Ryanair achieved its position of predominance thanks to the Twin Towers terrorist attacks. After 9/11 the airline industry’s assumption was that customers would inevitably cut back on flights, and overall it decided to play things safe.

Yet while many airlines brought marketing spend to an abrupt halt following the 2001 attacks, Ryanair understood that by reducing marketing spend, a company risks being forgotten by its consumers and to cut it completely is to gamble with anonymity.

Unlike its rivals, Ryanair embarked on a vigorous marketing campaign, encouraging passengers back to air travel. The company’s significant growth during this time proves that a bold marketing strategy can see you through tough times.

Learning hard recession marketing lessons
Today, it seems the airline industry has learned its lesson, because results from a recent survey by Airline Business shows that most carriers believe marketing spend should not be slashed during difficult times.

Around 45 per cent said they plan to spend "about the same", 30 per cent said their marketing budget for 2009 would be “higher than last year”, while a further 10 per cent said their marketing budget for 2009 would be "significantly higher." Only 15 per cent plan to “spend less”.

Visibility is key during a recession
'We're going to spend 10-20 per cent more on marketing this year," reported Icelandair chief executive Birkir Holm Gudnason, whose home market suffered more than most with the collapse of the Icelandic economy in October.

"We have seen since October that as soon as we stop promotions the inflow of bookings slows down. If we are visible, the number of visitors to Iceland increases."

As the Chartered Institute of Marketing warns in its white paper on recession marketing, ‘Keep calm and carry on Marketing’: The bottom line is that if you are not in the game, your competitors certainly will be, giving them an edge you don't want them to have.”

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