The Importance of Marketing During a Recession
The Importance of Marketing During a Recession
It’s no secret that the spread of COVID-19 has already had a grave impact on the economy. While markets crash and consumers put away their wallets, businesses may be wondering how to react.
During a recession, a common instinct is to cut marketing spend. The notion that consumers are buying less makes way for the theory that marketing may be a futile waste of money. In reality, the opposite is true. In fact, advertising during a recession is more critical than ever. In a precarious economy, your brand positioning and marketing moves are vital to your success for a number of reasons.
Cutting Your Marketing Budget Will Only Save You Money in The Short Term
When your profit begins to dwindle, it may feel natural to decrease spending on certain investments. Marketing is often cut because its benefits are often realized in the long term rather than the short term. Out of sight and out of mind, many businesses cut off vital marketing services and then pay for it down the line.
A reactionary decrease on ad spend may look good in the books at first, but it does not bode well for the longevity of your brand. Marketing is your lifeline to your consumer. It connects your brand to the people and without it you’re bound to fall out of relevance.
Instead of slashing your budget, a recession offers a chance to reassess your strategy and reallocate your spend. It’s a time to tap into how your consumers are absorbing information during a downturn and then appeal to that mode of communication.
It may feel like a relief to cut spending during difficult times, but that comfort is temporary. Use this time to invest in your strategy so you can experience long term success.
Gathering Data is Critical During a Recession
On average, recessions have occurred every four years since 1900. Unfortunately, economic downturns are inevitable and therefore should be planned for.
The best way to learn is through experience, right? Therefore, it’s important to maintain your marketing budget to analyze your strategies during this time. Well-executed digital marketing campaigns are designed to be monitored and tracked. With quantifiable results, businesses can utilize this information for future use.
If this is your first time experiencing a recession as a business owner, it’s critical that you monitor and document your workflow, changes, and results. Whether you’re tracking SEO, paid search, social media, or any other form of advertising, be sure to monitor their success during this unique time.
The next time the economy takes a turn for the worse, you will have strategies and processes in place to refer to. Each economic downturn is different and calls for diverse action. Despite this, having a foundation to pull from is extremely helpful.
It Will Help You Understand Your Target Consumer’s Behavior
Consumer behavior can drastically change during a recession — but not always in an obvious way. Most businesses focus on making services and products more affordable while others still offer luxury to those who can still afford it. It’s important to assess where your target audience sits on this spectrum during this time and then market to them appropriately.
For example, if you provide a luxury service, such as high-end cosmetic dentistry, you may be considering lowering your prices at this time to adapt to less consumer spending. Before you do this, you should consider your target audience. If they are unaffected by a recession and continue to spend at the same rate, they may feel your services are no longer tailored to them. They may sense a financial struggle on your end and question your ability to maintain quality service. Consequently, they will seek out other luxury services that still align with their normal spend.
If your target audience is affected and therefore becoming more frugal with their spending, it’s important to adapt. Consider bundling services, offering discounts, and making it known that your services are affordable. Consumers will be relieved they don’t have to sacrifice essential services such as dental treatments during this time. They will feel heard and understood with these changes, resulting in a loyalty that will last way beyond economic hardship.
Marketing and analytical tracking helps determine who your target audience is and the behavior they exhibit during recessions. With this information, you can either adapt or maintain your strategy to keep them interested.
It Will Keep Loyal Consumers Happy
The most important set of people to consider during a recession is your loyal customers. At a dental practice, returning patients are your most reliable source of income. This is especially true during a recession.
Marketing allows communication with your consumers. Social media and email marketing are two of the most common ways to check in with loyal customers. This target demographic is used to hearing from you and finds comfort in your presence through these forms of communication. Cutting your budget may also cut practices like these, alienating those who are most loyal to you.
Instead of cutting marketing spend and communication, consider amping up your efforts. Especially in today’s climate, your patients want to know you’re still there for them. Therefore, provide updates on social media, send emails, and make sure your marketing collateral is up-to-date and relevant. There are a number of ways to appeal to patients during the Coronavirus crisis. Utilize these strategies so your returning clients remain active and ready to visit your office when they can.
Less Competition Means More Room To Shine
As previously stated, it’s common for businesses to cut marketing spend during a recession. This trend provides an opportunity to stand out and differentiate yourself from your competitors. Companies everywhere are investing less money into digital marketing, which leaves room for yours to shine. Here are a few areas where you should amp up your efforts when others aren’t.
Search Engine Optimization:
While other websites are using outdated keywords and are generally ignoring their strategies for organic search, you should be doubling down on your efforts. With a strong SEO strategy, you can climb higher in search results when others aren’t making that effort. On top of this, user behavior changes during recessions, and therefore your strategy should. If you tap into this now, you’re way more likely to find yourself as one of the top search results.
Searches may be declining for certain services during a recession, but that also means that those who provide them may be scaling back on marketing.
With less people vying for spots with paid advertising, your PPC ads may receive more visibility and clicks at this time.
Many companies consider social media advertising to be an accessory to their marketing campaigns or a fun add-on that may not be necessary. Therefore, when faced with challenging times, it’s one of the first marketing verticals to be cut. Less noise on popular social media channels allows room for yours to shine.
Strong Marketing Exhibits Strength
In uncertain times like these, the status of many businesses is questionable. All around us we’re seeing layoffs, budget cuts, and companies shutting their doors. It’s unsettling for consumers and businesses alike to witness a faltering economy.
If you’re able to stay afloat during tough times, it’s important to let your customers know that you’re doing okay. A strong marketing campaign displays the health of your company and employees and lets consumers know you’re still available to them. When making purchasing decisions, users are going to search for a brand that they know still functions. If you make this unclear with a lack of marketing material, there’s a chance your target audience will move on to someone who is more visibly reliable at this time.
For those who are struggling to pay employees and overhead costs, we understand a large marketing budget is not in the cards. While this is true, there are many economical ways to let the world know you’re still active and happy to provide your services. Something as simple as a social media presence will do wonders for your brand at this time. Inserting strong keywords into your copy costs nothing and will position you to remain visible within search engines. There are many steps you can take to continue marketing without sacrificing your business. If you stay active, present, and understanding of what your customer needs, you will be well-equipped to weather the storm.
If you need assistance navigating this new marketing landscape or are wondering where to reallocate your spend, Lasso is here to help. Reach out to us today and we would be happy to chat.