April 28, 2020
No one has all the answers right now, but that didn’t stop us from asking a ton of questions to our CEO, David Foy. Here are just a few of his answers.
There have been eight economic downturns/recessions, and several other major international crises since the day the agency opened its doors in September of 1959. Some of the more notable include Black Friday in October of 1987, the collapse of the dot.com bubble in 2000, the tragic events of 9/11 that led to the war on terrorism, the Great Recession of 2008, and now COVID-19.
Some you could see coming, others came out of the blue. In every case, we were left with a great sense of uncertainty about the future of our business during those periods.
What I’ve learned since the mid-80’s is that when the economy takes a turn for the worse, there has always been an opportunity to create work that builds certainty. For example, during the last three recessions, direct, digital and database marketing activity actually increased in North America. Clients put a premium on measuring ROI on every aspect of marketing in order to justify their budgets. We were there to support our clients with these disciplines, and we continue to lead with these skills today. It’s one of the reasons we continue to grow.
Coming out of the recession of the early 90’s, I kept reading about how the companies that maintained or increased their marketing budgets during the recession fared better than their competitors. And just recently, data shows that brands that sustain exposure throughout a crisis can increase 3x more market share during downturns, and also rebound faster and stronger in recovery.
My advice to clients and to our partners is to not panic and freeze activity because of the uncertainty and fear. Perhaps you need to pivot for the moment to address the changing market, but keep moving forward. If you don’t, you can be sure your competitors will, and they will be further ahead of you when we rise out of the crisis.
I’m not suggesting that you spend wildly, but rather that you get your house in order to ride through the storm. That might mean you need to temporarily reduce overhead and other expenses for the good of the company’s cashflow.
But remember, opportunity can be found even in the toughest times. First, take care of yourself, your family, and your staff. Then with your remaining focus, get your business in a position to take advantage of the growth that will come later in the year.
There is a bit of both happening with our clients. Some clients are reacting to the COVID-19 crisis by promoting specific products and services as a way to help their customers navigate and benefit during the lockdown. Some of our clients are also taking the long view and looking at post C-19 in terms of helping businesses rebound and thrive.
An interesting fact about our clients is that they are all in a great position to leverage their unique benefits and solutions for customers while self-isolating at home. Just look at SiriusXM. They have for years offered online streaming to their customers, but most people assume they can only listen to SiriusXM in the car. However, the public is now waking up to the benefits of SiriusXM streaming while listening to their service at home for free (until May 15). It’s an amazing promotion.
And then there is our client Silk’n. They have a number of health and beauty products that help people take care of their skin at home. Their USP is the fact they offer effective, at-home cosmetic technologies that deliver professional results, all at an affordable price. What a position to be in right now! People who were in the middle of their laser treatments at clinics are desperate to get those treatments completed, but can’t as they are stuck at home. However, with Silk’n offering their products online, they are in an incredible spot to serve people all over North America, all in the comfort of their home.