Recent Market Losses: How Concerned Should We Be?

Many investors viewed the end of January and early February as a pretty scary time. Over a period of just 12 trading days (1/15-2/3), the S&P 500 lost -5.76%. This spurred conversations online and in the media about the end of a long bull market run and even the possibility of a bubble. However, since the end of that tough stretch, the market has responded strongly and is again obtaining new all time highs.

So what happened during that short time span to cause such a response? Was it a concern about the health of emerging markets that caused such a scare, or perhaps the threat of rising interest rates? Did the uncertainty of having a new Fed chairman cause a pullback in the market, or maybe the concern of a terrorist attack in Sochi during the Olympics? These are all clearly issues that obtained a good amount of short-term attention, but I’d contend that none of them were the root cause of the market decline.

History illustrates time and again that market volatility leads to memory problems for many investors. Check out this chart itemizing all market corrections of 5% or more since the bull market began:

As you can see, although the market has increased in value from 676.53 on March 9th, 2009 to 1,819.75 on February 11, 2014, the S&P 500 has endured nine pullbacks of over 5% during that time frame. As illustrated by the lengths of the red lines associated with each correction, many of these market declines happened over a similarly short time span. Consequently, despite the S&P increasing in value by 169% over the last five years, the market has experienced a decline of at least 5% every six and a half months on average. In fact, nearly a third of the months since the bull market began have seen the market decline, and by an average of 3% per month. Considering this information, late January and early February wasn’t particularly unusual.

These periodic market pullbacks aren’t specific to the recent strong run. Historically, we typically see three stock market dips of 5% or more every year and one correction of more than 10% every 20 months. Yet, for some reason, the same conversations and concerns are repeated during every market correction. Investors wonder if this is the beginning of an extended market decline or even a crash. People consider selling their assets and taking their money out of the market. It is so easy to forget that we have seen similar circumstances in the past and that very rarely has anyone benefitted from selling. Refer back to the chart itemizing all market corrections over the last five years. There wasn’t a single market decline that didn’t recoup all value in a short period of time. Even the 20% decline that occurred in 2011 only took nine months to go from peak to trough to new all time high.

As a result, I’d suggest that the January decline in the markets is not only nothing to be concerned about, but it is expected and healthy. In fact, if you have done your homework as an investor and have a well diversified portfolio with a stocks/bonds ratio that matches your risk tolerance, you’ll be hard-pressed to find a market movement that justifies dramatic action. Of course, there will always be market corrections (even the occasional crash), but as long as your portfolio is built to accurately match your investment time horizon, market values are likely to recover before the pullback is catastrophic to your retirement goals. Next time the market endures a short-term correction, remember it isn’t anything we haven’t seen before.

Top 10 Creative Marketing Strategies for 2014

If you are a business owner or internet entrepreneur, you know the importance of developing creative marketing strategies that work. Social media, video marketing, and blogging are three highly effective means of getting your brand out there in 2014. But what are the Top 10 creative marketing strategies according to the powers that be in the business world?

The following is my list of top 10 marketing strategies for 2014 that will help you attract more customers and increase your marketing ROI.

1. You Tube: 500 million People Can’t Be Wrong

One strategy you can use is to focus on descriptions when putting videos on YouTube. Use keyword descriptors which will attract people who are searching for what you have to offer. Remember Google owns YouTube, you want to rank high for your keywords.

Also, uploading more than one video to YouTube is a good idea as this adds to the credibility and gets you more traffic. YouTube gets over 500 million hits per month and 500 million people can’t be wrong.

People love watching videos for entertainment, education, and information. It’s the best way to get up close and personal with your customers and target market. Videos builds that know, like and trust factor.

2. Text Marketing: SMS and Content Writing

In a survey of 24 countries, more than half of the population in each of the nations say they own a cell phone; 91% of adults in the US own cell phones.

Market to mobile users by sending SMS ads to their cellphones including mobile coupons, keyword autoresponders campaigns, and designated group messaging.

3. The Power of Facebook: Your Window to the World

There are many social media platforms but few as powerful as this social media giant. Over 1.3 billion people per month frequent Facebook to check out what their friends are doing, check out new things, and look at ads. Yes, they actually do look at the ads. Facebook ads are a very effective business strategy but just putting up announcements on Facebook is enough to get the attention of thousands of potential customers.

4. Mobile Marketing: If it’s Not in a Mobile App, it May not Exist to the Next Generation

Teenagers and 20-somethings now use mobile technology far more than their predecessors, and they also use mobile devices more than PC’s or desktops.

Business people also use mobile applications at a growing rate in order to stay connected to clients and co-workers on a fairly constant basis.

To make sure you connect with this market, make your site mobile-ready and have an m-commerce solution installed on your website so people can buy from you with their mobile devices.

5. Email Marketing: Spam is Out but Email Marketing Prevails

Email marketing is still one of the single best things you can do for your company and brand. The challenge lies in separating yourself from the “spammers” and the businesses which are not credible and show people that you have something valuable to offer them.

To do this, you must get their attention in a short period of time and keep it long enough to get your message across.

This can be done with Compelling subject lines, “infographics,” interesting pictures, and text that features coupons or other special deals.

6. Guest Blogging

Guest blogging is another great way to get your message out, using the traffic generated by other sites to draw more attention to your brand and your site.

The best strategy for this is to write about something you really are an expert in, not just anything. This will promote not only your company but your expertise in certain niche areas, and bring you more credibility.

In return, you can offer to put a link on your site back to the place where you did the guest post also. This provides even more traffic for you, and them.

7. Use Google Hangout to Host Events Online and Offline

People love ‘live’ events. Tools such as Google Hangout and You Tube and other online tools allow you to host live events and connect to people online all over the world. Best part is it’s free!

If you announce you are going to host an event, interview, or other ‘live’ event, you will gain a large following of people quickly. Make it on an interesting topic and watch people tune in. Promote it on social media or blog for extra coverage.

8. Participate in LinkedIn Groups

With over 1 million groups in every possible industry, market and interest, LinkedIn presents massive opportunities for building a rapport with your target market. Join about 30-40 groups and post discussions that positions you as an expert in your field. Get involved by asking relevant questions, responding to comments and providing value to the group.

9. Ebooks: Use eBooks to Market your Business

Most people who have discovered this idea think they should make money with their eBooks, but they don’t think about the power of marketing with them.

Instead of charging for your eBooks, as a marketing strategy, consider putting links to your main website or offers in the eBook itself and offering it free on Amazon Kindle.

10. Blogging/SEO Techniques: How to Speak to the Search Engines

Blogging used to be something only everyday people did. Then businesses starting noticing how much traffic it drove and how much attention it brought to businesses and websites. One reason it works is because of its potential to be interactive with customers.

Also, the careful application of SEO techniques allows you to target specific key words naturally without overdoing it. It is highly recommended that you blog regularly once you start it, because this will keep you high in the searches and keep people coming back to see what you’ll write next.