The Importance of Advertisement in Downturns

The Importance of Advertisement

Most firms tend to cut cost during a recession to protect cash flow. However, empirical research has shown that an increase in advertisement spend during a recession leads to higher market share, sales growth and profitability.

This could be explained by the fact that an overall reduction in advertisement reduces the noise and increases the effectiveness of any single firm that maintains or increases its levels of advertisement.

This means general managers need to be smart about which costs to reduce and which investments to maintain in order to optimize firm performance across economic cycles.

 

 

Author

Pim is the co-founder of RGM Consulting and a core member of the global executive leadership team. In the leadership team he oversees: sales, research & knowledge development, marketing, and delivery.

Pim has extensive experience supporting leaderships teams across the globe, having worked on projects in Europe, Latin America, and Africa. Through his work, Pim has developed expertise in revenue growth management, business turnarounds, innovation management and marketing. Furthermore, he has deep expertise in the consumer goods industry.

Expertise

    • Revenue Growth Management
    • Business Strategy & Transformation
    • Business Turnaround
    • Innovation Management

Education

    • Master of Philosopy in Business Research (graduated cum laude)
    • Master in Business Administration (graduated cum laude)

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