It might seem counterintuitive, but times of economic recession may actually be the best time to market a new product, service, or organization. A recession, which we are all so familiar with today, is defined as "a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real gross domestic product (GDP), real income, employment, industrial production, and wholesale-retail sales." While this definition is somewhat vague, recessions have very clear consequences, including reduced consumer spending. How can reduced spending possibly be good for business? We can look at a real-life example, of which there are many, to find out.
Companies like General Electric, IBM, Burger King, and Microsoft were all started during economic downturns, but one of the biggest success stories of recession marketing is the Walt Disney Company. Walt Disney founded his animation studio in 1923, just before the Great Depression began. Normally, companies that make non-necessity items (anything but the basics of food, clothing, and health/sanitary products) are the ones who suffer the worst during economic downturns. When people are spending less, there is less demand for non-necessities and companies must instead create demand through marketing. Disney became popular at the height of the depression in the 30's because he was able to tap into the desires of the market. What people wanted was hope for a better future, or at least an escape from their dismal reality, and Walt Disney delivered that message in his cartoons. The Disney Company allegedly got by during tough economic times by following this model:
- What if anything was possible? Brainstorming ideas, like these attractions that were dreamed up but never built by Disney.
- Is it actually possible? Not everything creatives dream up is logistically or physically possible, so parameters like budget and time constraints have to be considered.
- Do we want to do it? Just because something is possible doesn't mean you will find it fulfilling or worthwhile.
- Should we do it? This is one of the most important questions to ask when launching something new into the world, whether it is a product or a new company or anything in between, because it asks whether the new idea is relevant and useful to the rest of the world.
- Let's do it.
Walt Disney has been quoted as saying, "I've heard there's going to be a depression. I've decided not to participate." This is the kind of attitude people launching new products or businesses need to take if they want to be successful and even profitable during times of economic crisis. Companies can emerge from a recession successfully by going against the grain; instead of following gut instincts to cut costs across the board, companies need to continue to invest in advertising. This helps them stay relevant while other companies are cutting advertising budgets. Consumers will best remember the brands that advertise the most, and they will be more likely to spend money on those brands both during tough times and once financial stability has been restored.