Advertising During Recession

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by: Ilya Vedrashko

Buckle up.

Washington Post
(Nov 26, 2007): “Widespread expectations of a recession could be
self-fulfilling because of how financial markets and mainstream America
are interconnected. If investors are sufficiently convinced a recession
is ahead, they would be reluctant to lend money to businesses that want
to expand, making it so.”
Here are the expectations:

Google Trends: term “recession” in searches and news (U.S).

Blogpulse: term “recession” in consumer-generated media (blogs, newsgroups)

NY Times
(Dec 4, 2007): “Growth in advertising spending in the United States is
slowing considerably, according to several forecasters whose
predictions are closely followed. But they believe the continuing
strength of ad spending online — as well as the stimulative effects of
the elections and the Summer Olympics — should keep the industry from
suffering a recession in 2008.”

(Dec 15, 2007): “Morgan Stanley has issued a full recession alert for
the US economy, warning of a sharp slowdown in business investment and
a “perfect storm” for consumers as the housing slump spreads.”

Time to dust off the trusty chart showing how advertising during recession is good for business in the long run:

results of a McGraw-Hill research that showed companies advertising
during the 1981-82 recession averaged higher sales growth (source).

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