Investing in Growth During an Economic Downturn

Most organizations need to invest in some degree of paid communication to achieve their growth goals. But when times are tough, there is temptation to cut back on “discretionary” items, such as lead generation and donor acquisition. Budget cuts tend to disproportionately impact these areas, as communications costs are often more easily trimmed.

Conversely, there’s a strong justification for staying the course, rather than circling the wagons.

Although it can be harder to authorize the investment when money is tight, studies show that remaining active in acquiring new leads and donors is even more essential during economic down cycles.

Here are just a few reasons why you should strongly consider resisting the urge to downsize your acquisition investments during an economic downturn.
1. The Long Game Reaps Long-Term Rewards:

Research reveals that brands can lose a staggering 15% of their market share if a competitor doubles down on marketing investments during an economic down cycle. Nonprofits can also lose ground, especially if similar organizations are boosting their profiles during these seasons.

Continuing current spending – and even increasing in some areas – gives you better odds for long-term success. While it can be easy to panic during economic turmoil, focus on the long-term return rather than short-term.

2. The Power of Brand Equity:

Brand equity is often an elusive measure of success that can be challenging to quantify in terms of sales and overall return on investment. That doesn’t mean, however, that it doesn’t have a significant impact on long-term revenue.

Brand equity is something that is built over years and requires years of consistent investment, even in difficult economic seasons. So resist the urge to cut back despite the lack of instant gratification.

3. The Opportunity to Diversify:

Staying on your toes and adapting quickly is crucial in the ever-changing world of fundraising, especially during economic challenges. While it feels better to stick within your comfort zone, economic downturns can provide a unique opportunity to utilize a more diverse paid media mix than before (rates may be even more negotiable).

By increasing the touchpoints for your brand and reinforcing its presence, you’ll often see a boost in ROI. But make sure you use your new insights to fine-tune your strategy and weed out the weakest channels. With data-driven insights on your side, your growth strategy will constantly evolve for the better.

4. The Excuse to Shake Things Up:

Tough times offer a great opportunity for a thorough, mid-stream review of your acquisition activities – and the chance to jettison the weak performers from your plan.

Rather than slashing the budget (and the growth), optimize the media mix and invest in channels that are performing well. And while pulling back on spending may seem like the obvious way to cut costs and hit financial targets, the benefit can be relatively low.

By hanging in there with your lead generation and donor acquisition investments during a sluggish economy, you can not only survive but also thrive – and keep your growth objectives on track. Taking the time to explore all the possibilities that exist for your acquisition efforts will give you an advantage now – and when things get back to normal.

As with your stock portfolio, playing the long game is key; continued investment in branding and advertising helps organizations maintain momentum. And be sure to monitor all possible strategies for optimizing visibility and return on investment so that you can make the best decisions.


If you’re ready to learn more about how to adjust your marketing strategy to weather tough economic times, Dunham+Company is here to help your organization have more impact

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