Paganini... and One String!
Advertising during economic uncertainty

On a cool fall evening in 1828, the flamboyant composer and renowned violin virtuoso, Niccolo Paganini, stood in the spotlight, performing before a packed house. Supported by the London Symphony Orchestra, Paganini was nearing the climax of one of his most difficult compositions when suddenly a string snapped! Beads of perspiration broke out on Paganini’s forehead. He frowned, but kept on playing and improvising. Suddenly, another string snapped, then another! Audible gasps wafted through the audience. Now there were three strings dangling from Paganini’s violin, yet he continued on, completing the composition on his one remaining string.

The audience leapt to its feet, breaking into riotous applause. “Bravo! Bravo, Paganini! Magnificent!” The chorus of shouts and accolades went on and on, subsiding only when Paganini said, “Please, please, ladies and gentlemen. Please be seated.”

“Be seated?” the audience murmured in curious delight. “Why be seated? Surely the concert is over!” Nevertheless, they complied with his request and settled back into their seats once more. Then Paganini, with a twinkle in his eye, lifting his violin high in the air for all to see, signaled the conductor to begin the encore as he turned to the audience and shouted, “Ladies and gentlemen-PAGANINI… AND ONE STRING!” The audience was stunned and the music that followed became an encore of triumph in the face of adversity.

America, and the local businesses at the heart of it, are facing just such a moment in history. For months, our economy had already been slowing. Suddenly, freedom itself was brutally attacked. Soon afterwards, the stock market plummeted. Strings snapped. But not all of them. One remains and it is the most resilient and resonant of all.

We will re-string soon, but we are not quite ready to leave the stage. Not just yet. There is more. Please be seated. Watch and listen world, as grass-roots Americans fearlessly and purposefully play an encore that proves our virtuosity.

Maestro, begin!

In this new economic environment the music, the message, and a primary focus will be on local people, local merchants, local dealers, local products, and their importance to local communities. In the coming months, buying opportunities will abound. Smart consumers are beginning to sense it already. The same will be true concerning advertising and marketing opportunities for the companies who have the foresight to take advantage of them. Incentives, discounts, and bargains will be as prevalent in media as they are in consumer goods.

While operating budgets should be carefully scrutinized, it is important to be aware of a basic misconception that has historically affected businesses under such conditions: that the advertising budget should be the first to go because it appears to be the least painful item to cut.

The hazard is, initially this strategy will seem to work. Here’s why: if you cut your advertising in a downturn, consumer awareness of your local business (which you built through past advertising) will not go away overnight. “Fine,” you think. “I’m saving some money here.”

Initially, you will assume that your advertising cut-back has not hurt your business. But while your marketing sleeps, your customers are slowly switching their preferences, often as a result of seeing your competitor’s ads. By the time you awake, you discover that the cost of recapturing your lost market share will be far greater than if you had maintained an offensive marketing posture all along. The saying is true: “In an economic downturn, the best defense is a good offense.”

The issue of whether to advertise during an economic downturn has been studied for decades. Previous studies published in the Harvard Business Review, the American Business Press, McGraw-Hill, and many others, covering downturn periods from 1925 to the present, have all reached similar conclusions: Companies that market products aggressively during economic downturns typically reap a major sales advantage (average 3.2 to 1 ratio*) over their overcautious competitors who panic and fall back into a defensive posture.

There is reason to hope. Since 1925, economic downturns have lasted an average of only 11 months, but the effects of advertising decisions made during this short period can have lasting repercussions. Timid souls who get nervous or impatient at the first signs of distress generally lose ground to the courageous ones who hang in there, ride it out, and view setbacks as opportunities to step into the spotlight.

It takes guts. Determination. It means staying on the stage and playing our hearts out with the resources we have. Strings break. That’s reality. But what happens to us and the circumstances we find ourselves in, are not nearly as important as how we respond to them. The audience is waiting. There’s the spotlight. You’re on!

*Source: McGraw-Hill Research 1986

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