Economic cycles play havoc with marketing strategies and tactics. It's all over the newspapers and on television news reports. People are being told that America is on the verge of, or is already in, a recession. Sectors of the economy, like housing, slip. Gloomy pundits step on the brakes and BOOM, the economy does indeed begin to slow. The cyclical nature of economics is undeniable. Brief periods of stagnation or recession alternate with longer periods of growth and progress. So, how should marketers respond when wary buyers begin to balk?

Some companies reduce marketing effort and curtail marketing expenditures. As sales volume slows, they scale back expenses in an effort to save themselves into continued profitability. It is wise to carefully examine marketing expenses and look for ways to redeploy effort to improve results, but those who arbitrarily cut back often end up on the short end of the stick when the business cycle turns positive. They trade long-term market position for short-term savings.

Other firms maintain marketing but experience poor results as buyers postpone decisions. The status quo is seldom a good choice. Now, some marketers may rely on additional sales training, bonuses, or motivational products to 'light a fire' under their sales force. Such tactics might appear to be positive, but they will seldom improve results significantly. Attempts to 'push' prospects into buying will not work. Continuing to spend as though the market has not changed also can be damaging to a marketer's career.  

A third choice is to increase marketing effort. Some studies show that increasing marketing effort in a down economy, when competitors have pulled in their horns, produces a significant improvement in market share over the long-term. Marketers also may offer additional buyer incentives. The zero percent interest and cash rebate programs used by the auto makers could be considered an increase in marketing effort. The programs do tempt prospects to buy now, but such programs reduce profits today and rob sales from tomorrow. Increased marketing effort does not necessarily mean increasing marketing expenditures. Simply throwing additional money at marketing and sales probably will not work very well. Customers and prospects are not ready to make commitments when the economy dips. In general, hard sell techniques fail to profitably win over prospects when they are in a 'wait and see' mood. Exerting more pressure, through aggressive sales tactics may only serve to alienate potential buyers.

The best way to increase marketing effort when people aren't buying is to build stronger relationships. Relationship building means more focus on bringing value to customers and prospects. It means that your sales team must spend more time listening to buyers and looking for ways to help them improve their situations. Relationship building is a powerful marketing strategy any time, but building strong relationships is just about all that works when times are tough. It is not about expensive lunches or gifts, it is about being genuinely attentive to buyers and offering to help individuals without expecting an immediate purchase in return. If you are in a service business, consider free seminars about how to get the most from a particular service. If you sell a product, offer tips on ways to extend its life or make it more useful. Look for ways to personalize your interactions with clients and prospects. Handwritten thank you notes and quick telephone calls to see how things are going are surprisingly effective. People sense when another person is sincere.       

In short, you cannot force people to buy when the economy slumps. Hard sell techniques and stronger 'push' marketing may actually be counter-productive. Extra incentives to gain immediate sales can be a significant drain on profits and rob sales from future periods, ending in no real gain. The status quo and prescribing motivational syrups are also pretty ineffective. Tough times call for smart marketing, and that means an even greater focus on effective relationship building with customers and prospects. When the good times return, marketers with stronger relationships will ultimately fare the best.