If you take a look at historic recessions, the most successful businesses were the ones that faced down the impossibilities with good strategies and positioned themselves for growth when the economy stabilized.
Although it is unclear how the COVID-19-induced recession will last – or what the economy will look like in the coming months – to be recession-proof and to retain customers, you just don’t go dark. To beat the odds, many businesses are ramping up marketing and advertising.
History has taught us that prioritizing marketing works.
There is always opportunity within adversity. The uncertainty of a recession is undoubtedly daunting and some businesses have completely stopped paid advertising and slashed budgets. So, if you think investing in marketing and advertising would be a fool’s errand, you’re not alone. Recent estimates guess that ad spend will reduce by 30-60 percent throughout 2020.
But here’s the thing, when you put the kibosh on advertising and marketing efforts you are giving your competition a greater share of voice, which in turn results in more brand awareness and sales – especially when the economy stabilized.
While it may seem like a paradox, recession periods actually provide fertile ground for businesses to grow their brand’s market share if they’re prepared to think long-term.
Still in doubt? During the 2000 recession, Target reduced its operating costs and narrowed its distribution margins, all while increasing its marketing and sales budget by 20 percent. Not only did Target remain steady amid a recession but they went on to become a major retailer over the next two decades.
So, here is how to recession-proof your marketing and advertising strategies.
The key to outsmarting a recession is changing how you market: shifting budgets into new marketing channels, tweaking messaging, shifting goals and tactics, and never, ever going dark.
While no two recessions have ever been the same, the one certainty we have is that consumers and businesses will reduce spending and set different priorities for what they buy. Although more than 10 million Americans have filed for unemployment, this doesn’t mean people want to stop hearing from you – they just want you to speak to them differently. Your brand messaging must shift.
1. Don’t freak out. Just pump the brakes.
It is natural for your business-as-usual strategies to come to a screeching halt. The clients we have that took the time to assess the new realty from a reasonable, rational standpoint are seeing their optimistic caution pay off. Make the obvious cuts, but don’t rush across-the-board reductions right away.
- Turn off and shift irrelevant campaigns. When festivals and events are being canceled, redirect those budgets to digital content.
- Create content around lower cost products and/or services. Focus on selling essentials and/or economy options, rather than costly discretionary items.
- Cut where it makes sense. Reduce operating costs (do you need that office when your team is remote?), narrow down distribution margins, re-prioritize activities, restructure agreements, and consolidate where feasible.
2.Provide more value.
After you have protected your ability to remain in short-term business, strategically invest in more long-term ramp-up projects and position yourself as a true innovator in your field.
- Understand your audience. What do they need? Look at all the data you have and discover where you need to innovate. Eliminate customer or client pain points where possible. Get creative with your delivery models, subscriptions, and new formats. Your customers aren’t just sales figures; they’re people with needs and problems to overcome. How will you solve those?
- Content is king. Still. Thought leadership content provides the best ROI. Consider what tips, guides, info, and advice you can share to help people. With more people at home spending hours consuming content on their devices, thoughtful content is a powerful investment.
- Boost marketing ROI with affordable paid ads. With fewer companies buying ads, the blow out pricing emerged. We’ve seen significant drops in cost per click on multiple digital platforms. When you factor in the low cost with increased web traffic, paid media campaigns are delivering more bang for your buck than ever before.
- Social channels boost PR. Share your brand voice, connect with partners to collaborate, partner with a charity, show humanizing behind-the-scene pieces of your personnel and operations. Just be present on social right now.
Let’s Talk About How We Can Help
During difficult economic downturns, brands often seek quick cuts to ensure financial security and sustainability, but marketing and advertising shouldn’t be included in those cuts. When done right, marketing and advertising can be the key to outlasting a recession, growing your business, increasing market share, and bolstering your brand reputation. When you’re ready to see what’s possible, let’s talk.