What impact does a recession have on marketers like yourself? Do you choose to slash your marketing budget and play it safe, or do you continue to market and adapt your strategies to connect with your target audience? We understand that these questions can be overwhelming during times of uncertainty.
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Thankfully, we are here to offer our assistance. In this blog post, we will explore important factors that marketers need to consider during economic downturns and how Admation can support and guide your team through these challenging times.
Psychology – The Foundation of Marketing in a Recession
In a booming economy, marketers often believe that increasing sales are, to a large extent, due to the success of their marketing efforts. In other words, they believe it’s their creative exploits that convince customers to buy products. However, this narrow view entirely neglects the psychology of the customer during times of prosperity.
During these times, customers have more disposable income, and they feel more confident about the economy and their future. In turn, this leads to customers embracing a lifestyle that involves more consumption and spending. Understandably, this psychology has a significant benefit in the number of sales a business can make.
Unfortunately, while this psychology works with marketers when things are going well, it can also work against them when the economy takes a downturn. So, in a recession, customers will have less disposable income, have less buying power, and spend less. In turn, this impacts their confidence in the economy and they, inevitably, change their shopping behavior.
Fortunately, it’s still possible to market effectively in a recession, and the key to doing this is understanding the customer’s psychology. So, based on the above, what can you thus expect from customers when a recession hits? Basically, when there’s a downturn, three main things will happen:
- Customers will spend more time at home and, as such, reduce their spending, eat out less, and skip vacations. This means they’ll consume entertainment at home, cook meals themselves, and will indulge less in luxuries.
- Because a recession means that customers’ buying power goes down and they have less money in hand, pricing becomes a more important consideration when shopping. They might also stop buying certain products completely.
- Brand loyalty become more important than ever. This is simply because customers will be more loyal to brands that consider their needs and expectations during tough times.
Why Marketing is Vital During a Recession?
Now that you’ve seen that it’s still possible to market effectively during a recession, you can let go of the belief that you should cut your marketing budget. But what causes this belief in the first place? You can almost think of it as a logical fallacy; there’s less money coming in, so less money should be spent on marketing. The problem, however, is that this argument views marketing as a luxury and not a necessity. Based on it, you can then argue that, because the economy has taken a downturn, you can stop paying salaries.
Conversely, when viewing marketing as a necessity, you’ll understand that you need to market to stay in business. When you don’t, you’ll likely decrease brand awareness and loyalty, lose customers and revenue, and get lost in a sea of competitors. Simply put, stopping marketing during a recession will only lead to long-term losses. Apart from preventing this, marketing during a recession can also:
- Provide more opportunities. Despite the advice given above, other businesses might also reduce their marketing budgets. In addition, they might also reduce their spending on market research and product development. Ultimately, this means that you’ll have access to more opportunities in the market if you market effectively.
- Meet customer needs better. In an economic downturn, customers’ needs and expectation change. When marketing effectively, you’ll consider these changes, and you’ll adapt your marketing strategies and campaigns to better meet the needs of your audience.
- Improve market share. As mentioned earlier, companies will likely spend less on marketing, research, and product development. In turn, this means that, with effective marketing strategies, you’ll make inroads into the market and improve your market share.
- Help businesses stay relevant. Marketing during a recession will help you stay relevant, especially if you're able to create marketing strategies that align with customers’ changing needs and expectations.
Maximizing ROI: Effective Strategies for Marketing During a Recession
We’ve now seen that, contrary to what you might think, you should increase your marketing efforts when there’s a recession. However, considering everything we’ve mentioned above, you’ll need to approach marketing differently.
This is because, when there’s a downturn, you’ll need to get the highest return on investment (ROI) possible from your marketing efforts. In other words, when there’s less buying power, you need to get more bang for your buck from your marketing. Let’s look at some marketing strategies that might be effective.
Build a Foundation on Customer Loyalty
Keeping in mind that you’ll want your ROI to be as high as possible, it makes sense to market more to existing customers rather than trying to attract new customers. Simply put, your existing customers could be your most valuable asset during an economic downturn. This is simply because it’s cheaper and simpler to market to existing customers. In fact, it could be up to 25 times cheaper to market to your existing customers compared to new ones.
Remember, your customers already know what value you offer and how you can solve their problems. Thus, when marketing to these customers, you’ll then focus on making your customers feel appreciated and keeping in touch on all your communication channels.
Adjust Your Goals
Just like marketing at any other time, your overarching goals during a recession will, ultimately, be to generate more awareness, make more sales, and generate more revenue. However, when marketing during a recession, you might use different strategies and tactics to reach these goals.
In turn, this might require a totally different set of key performance indicators (KPIs) that you’ll use to determine what’s working and what’s not. This is vital, as you’ll need to know what tactics perform best, which might need some work, and which strategies you can abandon completely. Not only will this allow you to market as effectively and efficiently as possible, but you’ll also save money when not persisting with ineffective campaigns.
Change Your Approach, But Stay Consistent
Based on your goals, you’ll likely need to change your marketing approach. For example, you might find that you need to put in more effort to reach your customers on certain channels. Conversely, you might find that, for certain strategies or tactics, you need less effort to reach your audience and generate awareness.
No matter what changes you make to approach, though, it’s crucial that you keep your messaging and branding consistent. Remember, customers are also going through uncertainty, so staying consistent gives them peace of mind that you’re doing well.
Focus on Your ROI
We’ve already mentioned that, when there’s an economic downturn, you’ll need to focus on those marketing strategies with the highest return on investment. As such, you’ll always need to know what’s working, what’s not, and what’s performing the best. This means you’ll need to analyze your efforts more often which will provide you with the data you’ll need to eliminate any doubt.
Double Down on Content Marketing
Now, when you analyze your efforts as mentioned above, you’ll find that some strategies will perform far better than others. One of these might be content marketing. This is because, when other marketers cut their budgets, they’ll often focus on tactics that work faster.
Content marketing, however, takes a long view, and, as such, there will be less competition. In turn, this makes it easier to rank in search results and generate awareness. And when it comes to return on investment, content marketing is a stellar performer.
How Admation Can Help
Finally, to market more effectively and efficiently in a recession, you’ll need to use the right martech tools. Simply put, when you use the right marketing technology, your marketing processes will be more efficient, your team more productive, and you’ll save time and money, which then leads to a higher return on investment. Here, Admation fits the bill perfectly. It has the features you need to reach your audience more effectively during a recession. Let’s look at some of the ways in which it can help in more detail.
A Single Place to Manage Marketing Projects
One of the major challenges that impact the way marketers work is having a fragmented approach to marketing project management. In other words, they manage their projects using several, often inefficient, tools. This is even more of a challenge when you want to make your marketing processes more efficient.
Here, Admation’s marketing project management software has all the features you need to avoid this and, at its core, gives you a single place from where you can manage your projects. This gives you full visibility over all your marketing projects and shows you where in the workflow every project is, what needs to be done, when it needs to be done, and by who.
Consistent Project Briefs
Delivering high-quality marketing projects depends on the planning you do before you start. In other words, your planning forms the foundation of the success of your projects. Unfortunately, this could be a challenge for some teams. Admation offers several features that simplify planning and ensure your projects get off on the right foot.
For instance, Admation gives you online briefs that ensure you get the right information before work starts on any project. This means you’ll reduce delays, eliminate unnecessary revisions, and get projects done faster. Also, by using a consistent briefing process, your marketing processes will be more efficient.
Improved Collaboration
It’s simple, your team performs better when team members work together. In contrast, when they don’t, everything becomes disjointed with team members not knowing what others are doing. Unfortunately, this is often the result of inefficient tools and workflows. Fortunately, Admation solves this problem with its range of features that all aim to improve collaboration, help team members become more productive, and increase overall efficiency.
Efficient Reviews and Approvals
When you’d like to market more effectively and efficiently, your marketing workflow should flow seamlessly from one step to the next. So, you need to get your reviews and approvals right. And this involves more than sending artwork or collateral from one stakeholder to another. You’ll also need to manage feedback and comments, revisions, and different versions of the artwork.
Admation has all the features that can help you do this. For example, with approval templates, you’ll be able to map out consistent workflows that guide every piece of artwork through your review and approval processes. The platform also offers a range of online markup tools that allow stakeholders to review and approve content without needing to use inefficient tools. And, to ensure that all feedback gets incorporated, Admation also offers extensive version control features.
Better Resource Management
To get projects and campaigns done as quickly and efficiently as possible, you need to know who on your team is available to take on any tasks. The problem is that, without the right tools, you’ll hardly ever know. Fortunately, Admation has a built-in marketing resource management tool that gives you deeper insights into your team’s capacity and availability, so that you know who can take on any new tasks.
Apart from this, the resource manager also features time tracking features that show you exactly how much time your team spends on every task. This not only helps you manage your projects more effectively, but also helps you identify any issues with your workflows’ efficiency. When you identify any issues, you can then implement the necessary measures to improve.
The Bottom Line
There you go, now you’ve seen that the last thing you should do in a recession is reducing your marketing budget or efforts. In fact, it’s quite the opposite. Hopefully, you’ve also seen what you need to do to market effectively during a recession and how Admation can help you do this. With its range of features that include everything from automation, audit trails, online briefs, in-depth reporting, and more, it’s the only tool you need to weather the recession.
