I’ve been through enough economic downturns to know the pattern.
At first, there’s hesitation. Then anxiety. Then a wave of reactionary decisions that either stall momentum—or set a business back years.
I’ve seen small businesses survive recessions. I’ve helped lead companies through them. And I’ve watched others get stuck by making the same avoidable mistakes.
This post is about those mistakes—and what to do instead.
Whether you’re already feeling the pressure or just trying to prepare, here are the five most common ways businesses misstep during tough times, and how you can move forward with clarity and confidence.
Editor’s Note:
This post is part of our Recession-Proofing Your Small Business series. If you’re new here, start with Post 1 to get the full strategy behind how smart SMBs are navigating this economy.
Mistake #1: Slashing Marketing Across the Board
This is the knee-jerk move. Revenues dip, so marketing gets the axe.
And while I understand the instinct, I’ve seen how damaging it can be. When you pull back all visibility, you don’t just save money—you become invisible. That’s a hard hole to dig out of.
What to do instead:
Reallocate your marketing budget—not eliminate it.
Double down on what works. Trim what doesn’t. (See Post #3 for ideas.) Focus on measurable, high-ROI tactics like:
-
Local SEO
-
Google Local Services Ads (LSAs)
-
Email and re-care campaigns
-
Website optimization to improve lead conversion
If you go dark, your competitors will happily take your place.
Mistake #2: Overcorrecting Without Reforecasting
This one comes from fear.
A recession hits and businesses start making cuts—staff, hours, ad spend, services—without looking at updated data or revised projections.
It’s reactive, not strategic.
What to do instead:
Slow down and reforecast.
In one of my past turnaround roles, we didn’t just cut—we paused to rebuild the forecast. We asked:
-
What are our essential expenses?
-
What’s our real break-even point?
-
Where are customers pulling back—and where are they still spending?
When you update your assumptions and scenario plan, you can make smarter, calmer decisions.
You don’t need perfect data. But you do need a realistic path forward—not a panic-driven one.
Mistake #3: Going Silent on Customers
When business slows down, so does communication. Emails stop. Social media dries up. There’s no new content or outreach—just quiet.
But customers don’t disappear during a downturn. They just get more cautious.
What to do instead:
Stay in touch. Be human. Be helpful.
This was a lesson we leaned into hard during COVID. At a time when many companies were canceling contracts, we launched virtual events, offered audits, and talked with our clients every week. That steady presence turned into years of opportunity.
Simple ways to stay visible and valuable:
-
Share real, useful content—not sales pitches
-
Acknowledge the moment, but stay positive
-
Highlight customer stories, team wins, or service updates
-
Let customers know you’re still here, still solving problems, and still grateful for them
Even a short email or social post can remind someone why they chose you.
Mistake #4: Treating Everyone Like a Cost Center
Another trap I’ve seen (and lived through): turning inward and forgetting that your team is your greatest asset.
In recessions, it’s easy to get transactional. Employees become “expenses.” Morale slips. People get quiet—or leave.
But your staff is watching how you handle this. So are your customers.
What to do instead:
Lead with transparency and invest in your core team.
In one turnaround, we saved the business by holding onto our best salespeople—and giving them tools, training, and freedom to rework how they sold. We didn’t shrink from them. We leaned into them.
If you have A-players on your team, keep them. Coach them. Show them the path forward.
And if you’re running lean? Treat every interaction like it matters. Because it does.
Mistake #5: Assuming Recovery Will Be Automatic
A lot of businesses think: “If we can just hold on, we’ll bounce back when things get better.”
But recessions don’t reward businesses that wait. They reward businesses that adapt.
What to do instead:
Build momentum now.
Reevaluate your messaging. Look for changing customer behaviors. Rethink how you package, deliver, or communicate value.
Even small pivots now can pay off big later. I’ve seen companies come out of a downturn not just surviving—but as market leaders—because they stayed proactive when others froze.
Here’s a helpful way to think about it:
-
Survival is about discipline.
-
Growth is about action.
-
Resilience is about doing both, consistently.
Final Thought
You don’t need to be perfect in a recession. You just need to avoid the common traps—and stay focused on what actually matters.
Here’s a quick recap:
-
Don’t go dark. Focus your marketing, don’t cut it all.
-
Don’t overreact. Reforecast first, then adjust.
-
Don’t go silent. Stay in front of customers with value.
-
Don’t lose your team. Invest in the people driving outcomes.
-
Don’t wait for normal. Take action now—imperfect but strategic.
Because the truth is, how you lead during the downturn will define how strong you are on the other side.
Up Next:
We’re almost to the end of the series. Next, we’ll wrap with a special post for marketing agencies and media sellers—how they can thrive in a recession and help their clients do the same.