Corina’s Concerns Be lowly wise, think only what concerns thee and thy being.– John Milton, Paradise Lost

Briefly put, there are two main schools of thought in terms of managing a company in times of recession: survivalism and forethought.

Survivalism means steering the company through the recession with a steel hand on costs, and a focus on keeping the company afloat despite the economic troubles.

Forethought entails management with a post-recession goal in mind. The company assumes survival and focuses on keeping the level of resources and assets (mostly intangible) constant throughout the recession, so it can leverage its superior position at the end of the downturn.

With respect to marketing, the survivalist company will retrench: cut marketing budgets (and staff), refocus what little money remains from branding campaigns to purchase incentive campaigns, price promotions, and other tactics that impact the bottom line more directly and immediately. Survivalists switch to predominantly push, vs. pull strategies and hope to weather the storm with as little investment in marketing as possible. (Even to the point of none)

Foretought recognizes the value of the brand, understands that once out of a customer’s evoked set of products or brands, reentry is amazingly hard, and that without maintaining it, the efforts invested in the past will be largely eclipsed, because the brand equity will erode and at the end of the recession, the brand will be in a weak competitive position.

At a first glance, the second strategy seems more intelligent, and indeed, many marketing thinkers (e.g. Laura Ries) recommended it. However, the survivalists also have a point: what if at the end of the recession, you still have brand recognition, but no company, or no people to deliver on the values of the brand?

The key, then, is to strike a balance. And that’s where the real work of the marketer begins.

Posted under Marketing vibes