Every year, my wife, her mother, and other members of her family skip church on Sunday morning to attend Dahlonega’s Gold Rush Days Festival. This year, I attended as well and strolled the Dahlonega square looking in booths and running into old friends and former students.

History Facts: The Gold Rush Days Festival commemorates the second gold rush in the United States in the 1820s/1830s and the first in Georgia. Georgia was home of the second gold rush in the United States. Gold on the dome at the Georgia State Capitol and the University of North Georgia’s Price Memorial Hall. Price Memorial Hall is built on the foundation of the old Dahlonega Mint – a former branch of the United States Mint built during the Georgia Gold Rush to help miners get gold minted without having to travel to Philadelphia.

One booth in particular caught my wife Brandy’s eye – selling garden flags and wrought iron garden flag holders. In making a purchase, I asked the woman at the register how the show was going.

Booth Owner: The show is a little slow and we had to cancel two shows in Western NC due to the recent hurricane. It’s also always slow during an election year.

Me: Do you also sell online?

Booth Owner: No. Our inventory changes quickly when we sell out and it’s a lot of work. We do own a physical store though in north central Georgia.

Me: Do you have a way we can get in touch to buy additional flags?

Booth Owner: *Hands my mother-in-law a business card.* You can visit our store.

Our interactions were very friendly, but I could already see opportunity for their business that was being missed (all proof I’ve been in marketing too long). But, her comment about being an election season triggered my imagination a bit. I’ve always “thought” that this was true – but is it?

Politics and Sales

First, before you get too excited, this post has NOTHING to do with whether you should vote for Big Bird, Harris, Mickey Mouse, or Trump. I hate to disappoint, but at the core of this post is a simple question – does an election year affect sales and if so, how so?

In my 20+ years of working with brands, the question about whether presidential election seasons affect marketing / sales is a tough one. Every industry is different as is every company. What may affect one may not affect another. But, there are some hard and fast rules.

B2C Companies

While some voters may become more pessimistic because of the president-elect’s expected policies, research suggests that election years don’t affect consumer spending. Faculty members at Princeton, Chicago Booth, and others have looked specifically at data regarding consumer sentiment, consumer purchases, and ideological position in an election year. What they found is even if the candidate that you oppose seems to be winning, it doesn’t negatively impact spending habits for most.

So, if you’re a B2C company seeing a decline in sales in 2024 – it could be more of an impact from inflation, pricing or even a strategic or marketing issue. Make sure to consider all of your options to double check your efforts.

Non-Profit Organizations

For non-profits, it always depends on the nature of their organization. In my experience, donations for non-profits do tend to drop during a presidential election. Donors specifically in swing states tend to give less as they may be financially supporting one candidate or another. In addition, it can be based on whether or not your non-profit could be seen as leaning in one political direction or another. This can especially be felt during end of year fundraising dependent on the support for a given candidate in your area and frankly – who wins the election and your non-profits leaning in one direction or another. Now, most non-profits don’t have a political leaning per se – but this is more about perception than anything.

B2B Companies

Now – we do know that B2B sales can decline in an election year. In a study from the Journal of Finance, B2B organizations tend to reduce expenditures by almost 5% during election years as compared to non-election years. This especially happens in the 3rd and 4th quarter. Why? Well, in B2C industries, consumers may not be happy but it may not affect them directly. For B2B organizations, politics can dictate extreme policy changes that can impact entire industries. It’s different.

All in all, it would make sense that those in B2B or that work with B2B companies would see the decline. This also is reflective in construction and other related industries. fI would argue that industries that are directly affected by interest rates or that have consumer targets that are highly impacted by interest rates (high credit card debt) or rent costs, could see some decline.

So, how do you prevent this decline?

Preventing the Decline

Following the Great Recession, there was a lot of research that found something very interesting: if you invested in marketing during the Great Recession, your chances of exponential growth were off the charts. Brands like Uber, Amazon, etc. were the big marketing spenders during that time period. And now, they are some of the largest companies on the planet.

How does this play out in a presidential election year?

When your sales are down, or feel like you’re moving in the wrong direction, your immediate reaction is going to be to cut your budget. And my experience would tell me that if left to finance – there’s a tendency to cut marketing first. But, the data seems to prove otherwise. Amazon and others all saw a decline in sales during the Great Recession. But, on the other side their growth was incredible. Why? It all comes down to the power of branding.

Brand Development if Sales are Iffy

In business school, we’re taught that someone has to know about you before they’ll take a chance on you…especially if your price is above their financial threshold of an inexpensive purchase.

Consider this – would you take a chance on new Coca-Cola® flavored Oreo’s®? Probably because you know the brands and they’re likely $5 or less. It’s at least worth a shot.

Would you take a chance on a new generator for your home without knowing about the brand and its quality first? Likely not because it first breaks a certain mental financial threshold for many of us and second you don’t know the brand.

The BRAND matters.

The reason you likely considered the $5 Oreo’s is because you know both brands. If I would have said Bob’s Root Beer and cookies from a new cookie brand you may have said no.

Brand advertising creates an emotional connection and builds confidence and trust in the organization and its offerings. So, when you do drop some new amazing new product or have something to sell – your audience pays more attention.

Now – I said to spend more on brand advertising. That does NOT mean to go buy expensive ads over the next week because you’re competing for space with political spends on radio and television. Don’t do that. You’ll lose.

That also does not mean to finance your marketing efforts on a line of credit praying for a quick return. Be wise about budgeting and plan accordingly.

What it DOES mean is to be successful in any campaign where you want to drive a return – people have to know who you are. And – if you are continually chasing after the quick win without investing in the long term profit, you could lose.

Many times clients that may be new to marketing will want to see the immediate return…immediately. The fact is that may take more work than just some quick ads…thus our focus on the long term.

Long Terms Profits over Short Term Wins

Earlier this week, I wrote on our digital “big board” this phrase – “Prior Proper Planning Provides Prevents Poor Performance.” This old British Army adage aligns again with the Agile Marketing Manifesto…. “Great marketing requires close alignment, transparency, and quality interactions with internal and external customers.”

We at Forum believe in planning. It’s at the crux of almost every one of our ongoing engagements. If we, and our clients, fully understand the market and their competitors, it’s a whole lot easier to fight the good fight on our clients’ behalf. Thsi way – we all know the challenges, easy wins, and what our experience and the data says is required for success. Without this as a guiding light and trust between us and our clients – it can be really hard to assure any return.

And, one of the leading themes that we’ve seen this year from businesses is a need for return. While some clients have still sought efforts focused on brnad, we’ve seen more organizations than usual expect some sort of direct return when starting a campaign. Some even have asked if they’d see sales increase weeks or even days after launching a campaign. That’s hard to predict if you don’t control all the variables. Plus, just like everything else, marketing activities have suffered from inflation this past year – that includes costs related to running Google PPC ads, social ads, and more. Things just cost more.

However, when marketing costs go up, expectations of return go up, and the room for error becomes very low. That’s a challenge especially when platforms have changed –  like Google Ads adding periods of learning for their AI platforms that require higher budgets and more time. But to be successful long term you have to be willing to fail to learn. That’s another Agile Marketing Principle – “take chances and learn from your failures.” If you go into any marketing effort / campaign / etc. and expecting some sort of magic wand to be waved and business fall from the sky – well – I think we all want that. But it rarely works that way.

The Small Shop Owner

So, let’s go back to the small shop owner from the beginning of this post. She mentioned that it “was an election year” but they didn’t have inventory management, didn’t sell online, had seen some downturn in sales because of missed festivals and maybe slightly lower localized consumer sentiment. None of those directly relate to the election and present opportunity. What should they do?

  • Start inventory management efforts
  • Sell online either via Etsy or via an eCommerce store or even an Amazon store to diversify sales channels
    • Online sales could offset costs from missed festivals or even drive new profit centers
  • Diversify sales opportunities to be less affected even if there is poor consumer sentiment

I’m certain there’s more – but usually the most obvious solutions are right in front of us.

So, no matter your political affiliation – just because your candidate wins or loses in the election, your business problems may not be related to who’s in office. It may just be an issue of strategy. And – remember …. be kind to everyone. Whether republican, democrat, libertarian or [insert political party], we’re all in this together.

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