Now, outside of contacting an exterminator, what lessons can be learned from my little centipede flattening scenario? Sometimes when things change suddenly, businesses run for a safe place. In particular, there can be a panic that sets in and everyone starts looking for the first dark place they can hide. This past week, the stock market reacted to a downgrade of the rating of the Fed by S&P. "Sell your stocks, cash in your bonds and buy gold,” was the chant all over Wall Street as the Dow plunged and investors ran for cover.

How does this kind of panic impact marketing? It has a huge effect because it makes marketing of products and services that much harder to sell. In the face of panic, only the necessities are deemed worthy of purchasing. In uncertainty, bare minimums are purchased to preserve capital. Contracts are canceled and future planning is put on hold. Timidity takes over, as everyone tries to stay in that dark corner until everything gets back to normal. These are the times we live in.

How do you market your goods and services in this kind of environment? First, it is important that you measure the mood of the marketplace before you try to sell anything. When your target market is feeling secure, sell them on all the extras of your product. Appeal to their sense of affluence. When your target market is feeling insecure, sell them on the necessity of your product. When a piece of bad news has everyone grabbing their purses, it is a knee-jerk reaction to automatically lower your price. This may be necessary to stay competitive, but it should not be your first reaction and certainly should not be your primary marketing message. Your first marketing message should be to explain why your target needs your product. Ask yourself this question: How necessary is your product or service? If your product or service stopped being offered, would its loss have a profound impact on the people you are selling to now? If yes, you need to market as a necessity. If not, you need to find a way to become a necessity or find something new to sell. How do you make a non-necessity item become a necessity to a target market? (Take a look at my earlier Nailing Post article, The Essential Non-essentials.) There are plenty of examples of non-essential items that people will not part with during hard times, such as television, cell phones, entertainment, and junk food. For instance, I am a Coca-Cola drinker. I am brand specific and get pretty put out if a restaurant is serving Pepsi rather than Coke. If the price of Coke in the vending machine upstairs goes up by 25¢, will I still purchase Coke from it despite a hard economy? Yes I will, because drinking Coke has become part of my routine. Is it truly a necessity of life? No, but you might not want to get in my way if I am denied my daily Coke. It is probably turning my insides into dark syrupy goo, but it has become a habit I don’t care to break. Ask me to give up eating out once a week and I will comply. Ask me to save a buck or two by carpooling with my kid’s lacrosse teammates and you will catch my ear. But ask me to give up drinking Coke and you will be in for a fight! If you are smart about marketing in down economic times, even times of panic, you can turn your product into a necessity in the minds of your target. If you have a product that has sold well in good times, but is struggling right now, try to shift your marketing message to a needs based message.

I noticed just this week that Apple Computers, makers of the iPhone, iPad and other technological gizmos that you would consider non-essential just surpassed Exxon Mobil, the oil giant, as the highest valued company in the U.S. Ask yourself - what is the essential, iPhones or gasoline? In the minds of the market, the iPhone gets the edge.