What the Current Financial Crisis Means for Your Marketing Strategy

When the NASDAQ bubble burst in 1999, millions of Americans lost money in tech stocks. Instead of letting the bubble pop entirely, the Federal Reserve took drastic action and lowered interest rates to 46-year lows. The Fed’s easy credit policy in the 2000’s led to the creation of many more bubbles including the housing bubble, mergers and acquisitions bubble, leverage buyout bubble, and the commercial real estate bubble. As the housing bubble started to burst in 2008, the Fed is again taking drastic action by printing trillions of dollars to bailout Fannie Mae and Freddie Mac as well as purchase mortgage backed securities.

The current economic crisis is hardly a local phenomenon in the United States. A look around the globe reveals the financial struggles many countries are going through from Iceland’s currency crisis to Dubai’s debt crisis to Greece’s alarming debt to GDP ratio. Unemployment rates continue to rise worldwide as companies cut back on every expense they can. Banks and credit card companies are reducing people’s credit lines while consumers are reluctant to spend any savings they have left.

So what does all this mean for you? What are the implications for your business? How should you adjust your marketing strategy? First, you should remember that marketing becomes extra important in a down economy. Marketing is the engine that brings in sales and customers, so if your revenues are down, you should cut back on everything else before you cut back on your marketing expenses. Reducing your marketing efforts will lead to even fewer sales, which can put your business into a downward spiral.

Secondly, you need to spend your marketing budget more wisely. Less people are looking at Yellow Pages or newspaper ads, which is one reason why many newspapers have gone out of business including the Seattle Post-Intelligencer and Rocky Mountain News. In fact, TIME magazine compiled a list of the 10 most endangered newspapers in the nation which included the Philadelphia Daily News, Minneapolis Star Tribune, Miami Herald, Detroit News, Boston Globe, San Francisco Chronicle, Chicago Sun-Times, New York Daily News, Fort-Worth Star-Telegram, and Cleveland Plain Dealer.

The trend is clear. More consumers are looking for products and services online, and more people are comparing businesses online before they purchase because they, just like you, are trying to spend their budget wisely. Gerald Celente, the Director of the Trends Research Institute, explains how Americans are getting sick and tired of things that are too big from businesses to governments to food serving sizes. A hundred years ago, most Americans were small business owners instead of corporate employees, and America was the most egalitarian nation on Earth. People valued community and took pride in the quality of the local products they produced.

As industrialization spread throughout the nation, small family farms became monster corporate factories. Local companies were driven out of business by giants such as Wal-Mart as more jobs were shipped to China. Today, the disparity between the rich and the poor is the widest in the United States than any other industrialized nation on Earth. Big companies became so big that they were deemed too big to fail by the government. Eating junk food became part of the American culture as fast food restaurants spread like wildfire throughout the strip malls in America. We no longer eat the local, quality food we used to have. The cheapest food is unfortunately fast food, which contributes to high rates of obesity among low-income families.

There is a quiet and steady movement among American consumers to demand quality again. More people everyday are discovering the high cost of being cheap. Many of the low-price products we can get today create huge environmental costs, social costs, loss of jobs in America, and even deterioration to one’s personal health. People are tired of the Too Bigs. It’s time to support the local mom and pops again. It’s time to keep jobs here. It’s time to cut back on overconsumption, get to know your neighbors, and support each other during these hard times.

What these trends mean for the wise business owner is to realize that people are seeking quality products and services. People want to support their local businesses so we can stop losing jobs to elsewhere. People are doing more research before they purchase, and statistics show 97% of consumers with Internet access research products and services online. People are overwhelmed with all the ads they see everyday, and they don’t want to see more ads when they browse the Internet. Instead of clicking on the pay-per-click advertisements, people want quality, organic search results.

As a smart business owner, you want to spend your marketing budget wisely. People trust the natural (organic) search results on Google more than the paid advertisements, because people perceive you cannot “pay” your way to the top of the organic search results. This is why search engine optimization (SEO) offers one of the highest returns on investment of your marketing dollars, because SEO helps your web site rank high on the organic search results.

SEO is a smart investment in today’s Information Age. Especially in today’s economy, business owners cannot afford not to invest in SEO.