Investing During Hard Times: Does it Pay?

As a Strategist for over 15 years, one principle that I have found to hold true time and time again is this:

When everyone is taking a particular path, consider finding an alternative.

This is not easy to do because it is not intuitive.  When everyone is promoting a particular course of action or direction, it is challenging to take a different path because it contravenes the conventional wisdom.  Not only will your firends and colleagues at work tell you that you are crazy but the media will reinforce it too; and constantly.  Consider these examples:

1.  You should invest in property when everyone else is selling.

2. The best time to buy shares is when the market is low.

3.  You need to differentiate your product in the market.

We have all heard these before and we tend to be comfortable with the logic.  That's not the problem, the challenge is executing when the time comes.

If you were to invest in property when everyone else is selling, you will have a strong negotiating position as there will always be someone willing to discount to make a quick sale.  We all know that buying shares when the market is down makes sense but it is hard to do when there is only talk of recession and "doom and gloom".  Despite knowing the importance of differentiating ourselves from our competition, so many businesses just gravitiate towards the mass market.  

So what's the point of this you ask? When is the best time to invest in your business?  In the hard times of course!

Consider these figures from AC Nielsen.

This research shows that it pays to invest in sales and marketing during tough times like a recession.  Now while this might make sense to us, when times are tough how many actually do it?  The evidence is clear, companies that do it experience about 5 times the growth of those who do not.  

So in today's economic climate, are you going with the herd?