As promised, during this year’s Ramadan and throughout the COVID-19 pandemic we will be helping you with tips to come out of the crisis stronger.
So, when I was doing research for this article, I came upon something fascinating. It’s a research paper by Kate Nichols of Elon University titled “Influence of Advertising During the Great Depression”.
“During the 1930s, the American Tobacco Company recorded consistent profits with the exception of 1931; Lucky Strike maintained its place as the most purchased tobacco product on the market throughout the Great Depression. The company credited its steady advertising revenue figures as a company asset of continued “great value” in relation to its rising profits (“American Tobacco,” 1929-1939). Lucky Strike’s market share indicates that advertising might have greatly influenced sales during a time when consumer spending was at an all-time low (“Cigarette Figures,” 1938). “
If you are a business currently struggling due to the economic meltdown caused by the COVID-19 pandemic, I recommend you keep reading.
Questions About Advertising During the COVID-19 Crisis You Need to Ponder
Are Brands/Businesses Pausing Their Advertising During the COVID-19 Crisis?
- Ad spend was down 33% on social media and 30% on paid search in March and April.
- Nearly a quarter of brands have paused all ad spend for the next months with digital ad spend plummeting by 38%.
What Happens When They Stop Advertising?
- According to Millward Brown 60% of the brands that seized advertising saw brand use decrease by 24% and brand image go down by 28%.
- According to Kantar, brands that go dark to save costs will witness a 39% reduction in brand awareness and a delayed recovery after the COVID-19 crisis.
What Happens When They Don’t Stop Advertising?
- McGraw-Hill Research researched 600 companies from 1980 to 1985. They found out that businesses that maintained or increased their advertising spend during the 1981 recession achieved sales 256% higher than those that didn’t by 1985.
- Here is the big one for me as a Marketer and for you as a business owner: Only 8% of consumers from 30 countries surveyed by Kantar said that brands should stop advertising (straight from the horse’s mouth).
Examples of Brands Winning Market Share Because of Advertising During Recession
The examples below are based on an article by Forbes: “When A Recession Comes, Don’t Stop Advertising”.
- Back in the 1920s, the cereal industry was dominated by Post. They significantly cut ad spend during the Great Depression. Kellogg’s, on the other hand, doubled their ad spend and even introduced Rice Krispies(R&D). Profits grew by 30% and Kellogg’s went on to own the category.
- During the 1990 recession, Pizza Hut and Taco Bell were able to do some damage to McDonald’s. When the fast-food giant decided to cut advertising both Pizza Hut and Taco Bell pounced on the opportunity. As a result, Pizza Hut increased sales by an astonishing 61% and Taco Bell blew up by 40% while McDonald’s spiraled down by 28%.
“I was asked what I thought about the recession. I thought about it and decided not to participate” -Sam Walton; Walmart Founder
How Should I Advertise During this Crisis?
You do not want to go out guns blazing without bullets. We could never give you all this juicy information without recommending to you what to do. We have been telling you how to approach this crisis as a business for a while now. I have therefore listed all the articles that can help you below. However, in staying with the numbers-oriented nature of this article I will first share some more numbers:
Based on Kantar
- 77% of consumers want brands to talk about how they are helpful in everyday life,
- 75% want brands to talk about their efforts to face the COVID-19 crisis, and
- 70% want brands to offer a reassuring tone.
Based on Internet Advertising Bureau:
- Businesses are taking a long-term brand building strategy
- 63% of businesses have adjusted their messaging
And Now Our Ramadan and COVID-19 Articles in One Place
Discusses the short-term and long-term impact of the coronavirus pandemic and what you need to do on a high level.
An uplifting and reassuring article that talks about the four phases that your business will go through during the pandemic.
An overview of the offer to small businesses by Muslim Ad Network that will remain valid until the crisis ends, or we reach 100 registrants.
This is our challenge to you as an individual and to ourselves during the last ten days of Ramadan. The goal is to practice social media distancing and getting closer to the Quran. Something we need even more now that we are deep into the COVID-19 crisis.
Similar to this list, this article outlines what Muslim Ad Network has been doing during this difficult period. However, it is more focused on how you can copy what we are doing and use for your own business/organization/brand.
Feel free to contact us, so we can help you through these times and prepare your business for life after COVID-19. Or just say hello!