We recently shared how to double down in a recession, and today I want to tackle another related topic: myths. When economic instability occurs, many business owners hold onto mistaken beliefs about things like brand awareness and marketing strategies that work or don’t work. Based on my experiences from the past, and knowledge of the current landscape, here are some myths and truths about business survival in a recession.
1. Myth: Credit can save you in an economic downturn.
I’m wholly passionate about debunking this because I’ve seen folks buy into it far too much. When the economy is scary, otherwise smart entrepreneurs often get themselves into really serious binds by “bailing” themselves out with credit cards and lines of credit. The reality is that adding more debt onto your back when you’re already in a poor financial position and worried about the economy will do one thing: crush you.
On the flip side, one of the easiest ways to survive a recession is to not be burdened by debt. I’ve been zealous about this at Highway 85, holding zero debt and buying equipment in cash. If you focus on staying strong financially during the good times, saving what you can and not taking on debt, you’ll be well on your way to weathering any economic storm that comes your way.
2. Myth: Businesses should dial down their marketing when the economy is tanking.
This is one of the most pervasive myths out there, and it’s time it gets exposed. Not only do you need to accelerate your marketing during downturns, but you should also think about how the rest of the world operates in such times. What are your competitors doing, for example? In most industries, the answer is that they’re retreating. They’re hunkering down and getting quiet, like I did with the business in 2008. Guess what? It’s a strategy that’ll fail you every time.
Instead, do what we did during covid and are doing currently: lean in as everyone else is backpedaling out. When it’s quiet all around you, think how much more of an impact your advertising and marketing can have. And here’s an important caveat: don’t just continue your initiatives. Grow them. Get loud. Gobble up the attention and take the market share that’s suddenly available. Just remember: don’t do it halfway. If you’re going to a trade show, for example, go all-in, intending to win. It’s the only way you will.
3. Myth: You can continue operating as normal in a recession, as long as you slash a few expenses.
Finally, there’s a mistaken belief that bringing down expenses is the main road to success in tough economic times. Yes, it can help, but there is another option that’s just as worthy: getting targeted.
First, consider how thin you’re spread. If you’re selling too many products, trying to reach too many customers and attempting to tackle too many projects and initiatives, you’ll have a much harder time making it through a recession. Narrow your focus. Continue funding and supporting whatever is making you profitable, and reduce or eliminate the rest – for now, at least.
It’s important to know the truth about these myths, because they’ll hurt you more than help you during times of economic instability. Stay the course and hold onto hope. It’s gotten us through before, and it’ll get us through now.
Ready to rev up your trade show program? Give us a call and we’ll help you fill your competitors’ silence and get more market share.