How small business should approach marketing in a downturn

A 3 minute read to keep your small business ahead, even in tough times.

Three upfront Pro tips on marketing during a downturn

"Straight into the highlights. Read on for more research and actionable tips"

1. Stay consistent with marketing spend (or spend more) while competitors pull back 🧘‍♀️: When others cut marketing, ad costs drop, and there's less competition. If you can, maintain or even increase your budget—this is how businesses can leapfrog competitors in tough times.
2. Optimise your current spend to work harder 💪: If increasing your budget isn’t an option, make your dollars work harder. Focus ads on your core product, refine your target audience, and run campaigns at high-impact times. Small tweaks = big results.
3. Leverage free marketing opportunities to stay visible 🤠: If budgets are tight, go all-in on free tactics: optimise your Google Business Profile, post consistently on social media, and collaborate with other local businesses for exposure. Visibility doesn’t have to cost a fortune.

A little introduction

"Feel free to skip the intro"

Financial Review, ABC and others are touting a recession as likely.

It’s bad news for many small businesses. 

History notes they are often hit hardest. 

And, when things are tight it's the marketing spend which goes first. 

But, you should think twice before cutting marketing spend. 👀

Harvard Business Review looked at how companies performed during the last three recessions and found that 80% of those that cut their marketing budgets still hadn’t bounced back to pre-recession sales and profits three years later. 

Kantar has found that going completely silent on advertising for too long can have lasting effects—people start to forget your brand, and that means fewer sales down the track.

Evidence shows if businesses can continue spending through a downturn, there is significant upside. 

Companies that maintained their investment generated higher growth than those who reduced budgets and went dark. Bain & Company found during the 2008 recession companies that kept investing achieved 17% compound growth rate. This is a trend that has been found over the last 100 years in a variety of different downturns, industries and studies. 

Think about it: When competitors stop marketing, there’s less noise. That means your message stands out more, and often at a lower cost because ad prices drop as demand for media space decreases.

So, as a small business what practical marketing tips can we implement based on this? 

Don’t worry if your marketing budget is stretched, sometimes it can’t be helped. We’ll also focus on clever, budget-friendly tips to keep your brand visible.

Step-by-Step Pro Guide: Marketing during downturn

"You might want to grab a coffee (or save the $6 and make one from home) and your notebook, or just bookmark the page."

1. Consistently spend because your competitors won’t be, even spend more if you can

In tough economic conditions, marketing budgets often drop. 

During COVID, for instance, marketing spend plummeted by 43% (Gartner, 2022). But this is where the opportunity lies.

Fewer competitors are running ads, meaning less clutter for you to break through, and you can often buy ad space at a lower price. Social media ads, billboards, YouTube placements—you name it—media costs tend to drop in times of crisis.

Staying visible through marketing helps people remember you and leads to more sales in the long run. So, if you have the disposable cash to invest, you can use these moments to leapfrog your competitors.

Pro Tip: Keep a close eye on these opportunities to get the most bang for your buck, while your competitors hold back

But, what if you don’t have extra cash to spend?!

2. Optimise your current advertising spend to work harder

You don’t necessarily need to spend more—just spend smarter. As marketing legend Les Binet suggests, optimising your marketing spend can yield impressive results. 

Here’s my tips to optimise your ad spend as a small business:

Be smarter by:

• Geo-targeting ads: Narrow down your target area (e.g. Gyms often have a catchment area of 6-8km so run ads only within that radius, Our Pro’s did this for NOMAD Bouldering gym, find it out for your business).

• Staying focused on your core product: Focus on advertising your core offering, don’t split your budgets across too many different elements (e.g. highlight your best-selling item).
• Timing ads to focus on specific behaviour: Use specific time windows to match customer behavior in your category (e.g., coffee shops targeting 5am - 11:30am).

For example, a café in Glebe (Sydney) could focus on:

• A 2km radius for their ads—because that’s the average distance people are willing to walk or ride.
• Running ads from 5 am - 11:30 am, when people are craving that first cup of coffee.
• Using mobile-first ads, because it's the device most people are using in the morning.

There are of course more ways to optimise your ad spend, but I find that whilst simple these little adjustments can make a big difference for small businesses.

3. Tight budget? Make use of your free assets to keep your small business visible

Of course, cutting spending sometimes can’t be avoided. But going dark completely isn’t the answer. If you have to reduce your ad budget, look for alternative ways to stay visible.

Nothing beats free stuff.

We often overlook just how many free (or super affordable) ways there are to optimise our marketing. Here are some of my favourites:

In-Person & Physical Marketing:

• Signage – Essential for retail and hospitality. Make it easy for people to find you and know what you offer.
• Local posters – The classics on poles and community noticeboards still work, an affordable and fun option to direct people to your business.

Online Marketing:

• Optimise your Google Business Profile – Not many small businesses do this well and it is one of the easiest and most effective things you can do. Here’s how.
• Use Google Business Profile updates – This free feature lets you share business updates, images, and promotions to keep your customers in the loop and boost search visibility.
• Stay active on social media – Posting consistently on Instagram, Facebook, TikTok, and other platforms is a free way to reach more people. 

4. Think creatively to further amplify your small business

Sometimes, a little lateral thinking can make the difference between just keeping the lights on and outperforming expectations.

Here are a few creative ideas to get you started:

• Partner with local businesses: You could collaborate with a neighboring business for co-promotions, sharing the cost and audience exposure. At its simplest this could be in the form of shared Instagram posts or posters on each other's premise.
• Lean into community outreach: Place posters on community noticeboards, posts on local Facebook Groups or offer to sponsor local events.
• Get creative on social media: Take a page out of @september__studio's book and use organic methods like engaging Instagram stories to attract followers without paying for ads. Click here for a peek at their own enjoyable format of content.

Why continuing to spend during an economic downturn is important for small business

Small businesses are the most vulnerable to the negative decline from stopping advertising and marketing expenditure (WARC, The anatomy of effectiveness, 2022).

So, think twice before cutting your ad spend first. Yes, it can feel like an easy cost-saving measure, but the long-term impact of going quiet in a recession can be severe. Staying top-of-mind is key, even when times are tough.

If you must reduce spend, don’t disappear—get creative, collaborate, and keep your brand present in customers' minds.

Cheers,

Zac

Note: The advice shared here should be considered in the context of your specific business needs and circumstances. Every business is different, treat this as additional information to help guide your decisions.

Need help? Hit ‘Start a project’ with Unjumble, and we’ll match you with a Pro who gets your industry. All our freelancers are Australian-based and vetted for quality, so you’re in safe hands.

Want to learn more about Unjumble’s marketplace service connecting Australian businesses to local marketing professionals? Check out our homepage.