In a recent study conducted by Ad-ology titled “Advertising’s Impact in a Soft Economy” more than 48% of US adults think that the lack of advertising by a retail store, bank or auto dealership during a recession indicates that the business must be struggling. Conversely a vast majority perceives businesses that continue to advertise as being competitive or committed to doing business. The study concludes that it is critical to advertise in the current economic climate to maintain long-term positive consumer perception of your brand.
In another study by the University of North Carolina it showed that marketers that cut spending during a downturn lost share to private labels – share they did not regain. Another benefit of spending on a consistent basis is that the stock prices tended to increase an average of 1.3% ahead of others.
It takes courage to go against the economic trends but the long term results can be very beneficial both to Main Street and Wall Street.