Responses to a survey conducted in March 2018 by non-profit business support and marketing organisation, Team Namibia, indicate that 54.55 percent of the respondents to the survey said that their annual revenue had dropped, whereas 31.82 percent said that their annual revenue had remained the same. Indeed, 9.09 percent said that their revenue had increased.
Due to reduced sales, most of these businesses introduced cost-cutting measures. According to the survey, it appears that 60 percent of businesses have reduced their current marketing budgets and for about 30 percent of businesses the marketing budgets had remained the same while only 30 percent increased their marketing budgets.
Bärbel Kirchner, account director of Team Namibia explained, “Cost-cutting measures during an economic recession often include the reduction of marketing budgets to avoid retrenching employees. This approach could be detrimental to business. Literature about marketing activities during an economic downturn or recession generally advocates continued, if not increased, marketing spending as one should not stop communicating with one’s existing, albeit smaller customer base.” She added that this may not be applicable to all businesses and it would also depend on the sector in which the business operates.
“However, if there is a continued need for the product or service, despite a momentous downward fluctuation in demand, business owners should seriously consider increasing their marketing activities, not only to keep communicating with their customer base and to maintain their market share but also to strongly position themselves and indeed increase their market share, especially if their competitors have gone quiet,” Kirchner continued.
Engaging the services of a variety of marketing specialists such as marketing research businesses, advertising agencies or online marketing specialists might also become more affordable during tough economic times, as well as the opportunities to get your messages across, for example, through advertising in the print media, on radio or on television. Respondents to the survey conducted by Team Namibia, endorsed this view.
Seventy-two percent of the respondents agreed that (20 percent – agree; 54 percent – totally agree) that one should continue marketing during an economic downturn, whereas only 11 percent disagreed (6 percent – totally disagreed; 5 percent- disagreed).
In fact, most respondents 82 percent –agreed (25 percent) and totally agreed (57 percent) that “there are great opportunities to be had when you continue marketing during an economic downturn”.
According to John Quelch’s (Dean of the University of Miami School of Business Administration and previous Charles Edward Wilson Professor of Business Administration at Harvard Business School). In his article in “How to Market in a Recession” for Harvard Business Review (2008), it becomes even more important to know your customers; maintain marketing spending; and to adjust product offerings in customers’ needs; and indeed to focus on family values.