If you have former advertisers who think they can weather the recession by not advertising, then return to business as usual when the economy improves – they are kidding themselves. Not advertising sends a signal to consumers – a pretty undesirable signal.
The latest Ad-ology Research study, “Advertising’s Impact in a Soft Economy,” analyzes consumer perception about businesses that continue to advertise, and those that do not, in the current economy.
More than 48% of U.S. adults believe that a lack of advertising by a retail store, bank or auto dealership during a recession indicates the business must be struggling. Likewise, a vast majority perceives businesses that continue to advertise as being competitive or committed to doing business.
The study finds advertising appears to play a key role in consumers’ view of how a business is doing, and by not advertising, businesses may be sending a warning signal to current and potential customers.
“It is critical to advertise in the current economic climate, to maintain long-term positive consumer perception of your brand,” said C. Lee Smith, president and CEO of Ad-ology Research. “Advertising not only assures consumers of a business’ reliability in a soft economy, but it can influence where and what they buy, especially when the ads address concerns about value,” Smith said.
Other key findings:
— TV, newspaper, direct mail, and Internet top local media from which consumers saw/heard an ad within the last 30 days that led them to take action
— Store Web sites ranked second only to search engines as the way consumers research products and shop online
— 40% of consumers use coupons more now than a year ago
— Most consumers are as willing or more willing to pay more for ‘healthy’ or ‘organic’ products than they were a year ago
— A ‘deeply discounted price’ was the number-one factor that would make consumers more likely to purchase a big-ticket item (+$1,000)
Ad-ology Research surveyed an online consumer panel of 1,225 adults in a manner that is 98% representative of the adult population of the United States from April 24-29, 2009. The margin of error for this survey is +/- 2.2 percentage points.
Ad-ology Research analyzes key marketing and advertising trends in over 400 industries and what motivates end-customers. More information about the research company is available at www.ad-ology.net.
