During a recession, it is advisable for a firm to slash their marketing efforts to ensure survival until the economy improves.

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Question restatement: The statement proposes that during a recession, a firm should slash its marketing efforts to survive until the economy improves.
Option 1: True. Explaining why this is not a good stance: Slashing marketing during a downturn can reduce brand visibility and customer acquisition exactly when competitors are trying to capture share of voice. Marketing can-help sustain demand, communicate value, and prevent long-term loss of market position. However, some firms might optimize marketing spend or shift channels, but the blanket idea to slash all marketing is typically detrimental because it weakens demand signals and delays recovery.
Option 2: False. This is the correct line of reasoning: During recessions, many successful firms maintain or even reallocate marketing to defend share, support customer relationships, and stimulate demand. Strategic marketing can be more cost-effective in this period, leveraging messaging, targeting, and digital channels to reach cost-conscious customers. Cutting marketing aggressively risks losing mindshare and making recovery harder once the economy improves. Additionally, marketing can be used to reposition products, highlight value, and preserve brand equity for the eventual upturn.
Why the false option misleads: It assumes marketing has little to no positive impact during downturns and that survival depends solely on cost-cutting. In reality, smart marketing decisions—such as focusing on high-ROI channels, refining targeting, and maintaining brand presence—often contribute to resilience and faster recovery. The reasoning also ignores the potential long-term consequences of reduced demand generation and customer retention that come from starving marketing.
Why the true option is insufficient on its own: If interpreted as a universal directive to cut marketing without nuance, it would misrepresent best practices. The nuance lies in adjusting and prioritizing marketing efforts rather than a complete cut, which is not captured by a blanket True assessment. The statement as written is too absolute and ignores evidence of strategic marketing importance during downturns.

badm_320_120251_242530 Midterm Exam

During a recession, it is advisable for a firm to slash their marketing efforts to ensure survival until the economy improves.

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