Many of us are shocked by how quickly our economy tanked. Even though the housing and credit crisis has been brewing for many months, it appeared that the worst was over – and then POW! – the economy really dropped in the past two months.

Now is not the time to crawl under a rock and wait for the economy to improve. You can turn the economic downturn to your advantage by being proactive and creative in your marketing. Try some unconventional and dynamic marketing ideas that will help keep your business moving forward. Then, when the economy turns around, your business will be well positioned to ride the wave of prosperity and future growth.

Cut staff or cut marketing? It’s a tough call. This article provides you with a few ideas that will keep your marketing invigorated during an economic downturn and generate enough business for you to keep your key employees.

With the slowing economy dragging us into a recession and causing sales to fall, business managers are facing the difficult challenge of finding ways to swiftly cut costs. Two of the quickest ways to accomplish this is to lay off employees or to cut marketing programs. While both of these options achieve the short-term goal of lowering costs, they also have negative repercussions on the long-term health of your business.

Letting go of key staffers who are highly-trained, productive employees will prevent your business from recapturing lost ground when the economy does turn around. Finding new employees is an expensive and time consuming process of recruitment, negotiating salary and benefits, training, and assessment.

Cutting back on marketing also hurts your business’s long-term health. As you diminish your presence in the marketplace, you’ll lose more sales and marketshare as customers go to your competitors. This will only exacerbate your negative business situation.

However, for management with vision, a recession can be an opportunity to increase your presence in the marketplace and take marketshare from your competitors who have had to cut back on their marketing. These managers understand that when the economy turns around (which it always will), their company will be best positioned to take full advantage of the economic rebound and grow at a much faster rate than their competitors.

Some low-cost options

Here is a list of seven low-cost marketing ideas that will keep your business at an advantage during a recession

Hold Events:

Think of creative, informational, or promotional events that you can hold that will build awareness for your business and generate new customers. For example, an exclusive summer camp for kids held a winter reunion at venues near clusters of where campers lived. They invited campers to attend, and more importantly, to bring friends. They charged a nominal amount to cover the cost of the venue, food, and entertainment. These events serve two purposes: reconnecting in a positive way with current customers during the off season, and providing access to a bunch of potential new customers.

Start Blogging:

Soon, having a blog will be the norm for many businesses. It’s a great, low-cost way to create a dialog with your customers and keep them interested in your business. Blogs can help to establish you as an industry “thought leader,” and can position your company as foremost in your industry.

Do some PR:

Public relations can be a very effective and relatively inexpensive marketing tool if done properly. Get your team together and brainstorm ideas that are timely and will capture the attention of news outlets. For example, during this summer’s high gas prices, one business held a contest to win a $500 gas card, which garnered loads of press. Besides holding contests, there are plenty of other ways to generate publicity and new coverage. Try sponsoring an interesting event, or conducting a poll relevant to your industry.

Start an Email Marketing Campaign:

Email marketing is an effective and low-cost way to sell to customers. Using email services such as Constant Contact or iConnect, setting up an email program can be easy and cost-effective. The services provide a variety of pre-formatted templates that most people can easily use and the ability to easily manage your email database. You can segment your database of names and email addresses so you can provide different offers to targeted groups of customers, which yields higher sales conversion ratios.

Optimize Your Website for Search Engines:

How “Google-friendly” is your website? Almost every business benefits from being on the web. But if you want people to find your website through Google, Yahoo, and MSN, then you should have your website optimized for web searches. Getting your website on the first page of Google has become an “Oprah” moment for many companies – and with good reason. If you’re able to come up on the first page of a Google search, you will generate many more click-throughs (and sales) to your website than being on page 2 or 3. Search Engine Optimization has over 200 factors that determine how high in the search rankings your website will appear; using a consultant that is expert in this process is a must.

Renegotiate Your Advertising Contracts:

During a downturn, many companies cut back on, or stop their media advertising completely. Why? – because it’s an expensive marketing tool. The reflexive approach is to cut back on this effective marketing tool to save money, but this is a little like cutting off your nose to spite your face. A more valuable approach is to renegotiate your advertising contracts.

Media companies are hurting too, and will be much more open to negotiating better rates, terms, or positions for you if you maintain your ad schedule. Doing so means more customers for you and less for your competitors, while saving money to boot.

Revisit old customers:

The old saying is still true: it’s much easier and cheaper to sell to an existing customer than a new customer. Revisit your past customers who haven’t purchased in a while and find out why they haven’t. Offer a special deal or incentive for them to resume business with you. Offer good customers incentives to purchase more. The loss in margins will outweigh the costs associated with getting new customers to replace old ones.

Perhaps I’m being optimistic, but I believe the worst of the housing and credit crisis is behind us, and this downturn will be brief, though painful. I strongly suggest you put your resources towards the low-cost marketing tactics mentioned above, and most importantly, execute them as quickly and consistently as possible. Consistent marketing during a recession will provide your business with enough sales momentum to survive the downturn, and when the economy rebounds you’ll be surging well ahead of your competitors.