The Nielsen Company released an article today by Mitch Barnes, president of their Greater China division that asks the important question, “Should we continue to invest in innovation or should we save our money [during tough economic times]?” Certainly, a question on the minds of consumer electronics companies.

Nielsen studied recessionary times in a variety of markets over the past 30 years finding companies who continue to invest in their new product innovations emerge from the recessions with much higher growth rates than companies who cut back. As a comparison, these growth rates are two to three times higher or even five to 10 times higher in some cases.

“The clear implication is that companies should do everything they can to maintain their investments in innovation and new product launches amid economic turmoil. Maintaining these investments will pay off substantially — in terms of growth and competitive advantage — when the economy improves.”

- The Nielsen Company, March 2nd, 2009.

Also supporting these findings, Sam Palmisano, chairman and chief executive of I.B.M., agreed that there is no better time for innovation to prepare the US for a much more competitive infrastructure for the future. In a recent interview with CNBC he said, “if you have the financial wherewithal you’ll never be given an opportunity like this again.”

If you aren’t sitting on the $14 billion in cash I.B.M. covets and are somewhat new to the market, here are 7 Tips for Startups in a Down Economy mentioned by Seth Godin, marketing guru. 

1. Recognize that you’ll have less competition.
2. Focus on building value.
3. Expect your costs to go down.
4. Don’t hire like it’s 1999.
5. Focus on the irreplaceable.
6. Get lean to beat the behemoths.
7. Be disciplined about what you’re building. 

While I believe each of these are important, consumer electronics brands should pay critical attention to building value in their products. With so many choices and more cautionary purchases, consumers need to uniquely connect with your technology and brand.