Businesses are already feeling the effects of the current Coronavirus pandemic, and when it joins an economic situation like the current one, they tend to stop doing digital marketing during a recession. As an initial, responsible and mature reaction, it is natural to stop all costs and expenses. But once the operation is scaled down and finances are under control, marketing activities must be recovered.
A recent article in Forbes Magazine warns: “ Given Mexico’s high dependence on the US market, we can estimate that, if the fall in the economy reaches 5 or 6% in the United States, Mexico would have a drop of 8 to 9%; but that [this scenario] considers that the government has an expansive fiscal plan. If this stimulus does not occur and there are more spending cuts, then the fall may be greater than 10% “
Let’s assume the above happens. Faced with a recession, companies immediately try to cut costs and stop doing digital marketing at those savings. But, if this is maintained in the long term, it is a mistake because we would lose all strategy to try to come out of the crisis as winners.
Why should companies keep doing digital marketing during a recession?
In particular, our first instinct is to start questioning the value of our marketing budget. What we don’t realize, however, is that companies that cut back on their marketing efforts during an economic crisis will actually end up jeopardizing their long-term market share.
Competitors that do maintain their digital marketing efforts will gain positioning in front of customers who abandon themselves to stop investing in marketing and can lose the positions achieved for years in months.
On the other hand, it is important to recognize that increased digital marketing during a recession can lead to sales growth and support long-term business continuity, but it is a strategy that needs some modification.
Staying in the minds of buyers and consumers
Companies that continue to advertise during a recession remain on the front lines of consumers ‘and shoppers’ minds, so when shoppers get their money back to spend, they instinctively turn to these brands.
Additionally, when digital marketing efforts continue during an economic downturn, the message to the audience is one of strength, soundness, leadership and continuity, which is what buyers are looking for in such uncertain times.
Even if the company is not at its best, customers and prospects will be attracted if there is a message of stability and an image of continuity.
On the other hand, reducing marketing during a financial crisis will reduce your presence online and offline, leaving the door open for competitors to take advantage and fill the void that you are leaving.
7 tips to get the most out of your digital marketing budget during a recession
We are many supporters of maintaining marketing during a crisis. While you may not be able to advertise at your full capacity during a recession, going offline completely is not a viable option either. Let’s talk about some ways to continue digital marketing while keeping your business on budget.
Sell to existing customers
Your database is your most important asset and if you don’t have it, it’s time to invest in it. Having a loyal customer base is your most valuable asset during the recession. It is cheaper, simpler and more effective to market your products to your existing clientele. Of course, we are all looking for new clients, but if you have a tight budget, start with who your clients already are instead of focusing your efforts on attracting new clients. If you can do both, then you have a formula that is sure to give you good results.
Your digital marketing budget during a recession will allow you a better return if you target existing customers.
Let your current customers know that you appreciate them by staying in touch through thank you emails, empathy messages, exclusive discounts, and so on. After all, they are the ones who make repeat purchases, understand your services, and best of all, recommend you to other customers.
Lean on being a consistent brand
There’s no question that more digital marketing efforts need to be done during a recession. But consider that, to make your way, since there is less “marketing noise”, you may not need as much budget as before.
If you maintain the consistency and coherence of your brand, the public will feel your commitment. For this, it is essential to develop a monthly plan of marketing strategies, which includes the publication of notes of interest on your blog, emails, content on social networks, videos and everything that is part of your company’s communication portfolio. Do not forget that in networks you need to amplify your content with advertising, otherwise you will invest a lot of effort and you will reach few people.
However, advertising amplification should not be expensive – just consistent – to help you stay relevant and reach your entire audience.
Send a positive and empathetic message
Your company’s marketing plan must always be updated, but even more so when economic and market conditions change.
A crucial step here is making sure your brand is sending a positive message, one that fits the sensitive mood of your customers and prospects and avoids any resentment. Your message should encourage and empower your audience, which will help build a strong emotional bond.
In fact, an analysis of cases published by the World Advertising Research Center revealed that advertising campaigns that focused on emotional engagement were found to be more profitable than campaigns that prioritized transactional messages, such as special offers or sales. discounted prices during a difficult period.
Advertising companies that focused on emotional engagement turned out to be more profitable than companies that prioritized transactional messaging.
What to change in digital marketing during a recession?
Limited budgets, shifting priorities, and shifting customer buying patterns require that you not only continue marketing, but change the way you market your business during a recession, change the product and price, change the payment methods and change the scope of what you offer.
1. Your offers
The recession can have a double effect. While some businesses suffer, others can prosper. The main difference between these two categories is the type of goods or services they work with.
Businesses that sell solutions to needs will always have buyers, regardless of their financial situation. Therefore, if your company sells goods or services that are not considered “essential”, you will want to reconsider its offer of price, scope and payment method and you should focus your digital marketing during the recession on communicating these attributes. You probably can’t change your product mix to sell gel or masks like the hundreds of thousands of companies, but surely when doing an 80/20 analysis , you will find that some of your products or services are more essential and on those you will have to make your campaigns .
2. Your fingerprint
Make sure all your online profiles explicitly make it clear to customers and prospects that your business still exists and is running strong. Update your schedule, announce your latest offers and stay committed to your customers. Your digital marketing during a recession should communicate strength, continuity, empathy and flexibility, but never absence or abandonment.
3. Your budget
In an interesting article in Merca 2.0 Magazine they state “ Optimize the use of your marketing budget, don’t interrupt it. During a recessive period it is important to maintain contact with consumers. Focus your advertising on the most profitable niches and invest in effective tools ”.
Regardless of whether your marketing and / or advertising budget stays the same or shrinks during the recession, be very punctual about where you spend money. Make sure that your agency gives you metrics to be able to pay attention to the channels that are working well and reallocate budget to them and remember to believe that just by making organic efforts in search engines (Google) and social networks, you are not going to get very far; You must have an advertising budget to amplify and accelerate organic work.
4. Your tone
A recession is a period marked by intense emotions, so you may have to change the tone to attract the audience with whom you want to continue business and customer loyalty. An empathetic, flexible and understanding tone will always be better received than a harshly salesman tone. You can continue to communicate the same core messages and values of your brand, but you may need to conduct an audit to ensure that anything that is potentially insensitive or controversial is removed from your digital communication, emails and profiles on social media. Digital marketing during a recession needs to be more humane.
5. Your KPIs
Digital marketing key performance indicators (KPIs) and metrics and Analytics can help you determine which campaigns are giving you the best results. Prioritize what is generating income. This will help you save money and boost your sales.
But ” prioritize what makes money ” does not mean you abandon the medium term, even if it does not give money immediately. An example: in search engine campaigns, the short term with immediate results are campaigns in Google Ads, also known as SEM (Search engine Marketing) ; and the medium term, but with strategic results are the organic search engine optimization campaigns, Adaptive SEO . Although, Google Ads should be given priority, organic positioning should not be stopped through SEO, because if you do, the day you cannot pay Google Ads, you will not have organic traffic because you have not invested in the organic positioning that is , in a way, a medium-term insurance.
Remember to adjust your KPIs to current reality so that when you evaluate the results of your strategy, it is against more realistic digital marketing goals during a recession.
6. The main objective- customer acquisition …
You always want to target the right audience with your branding and advertising, but during an economic crisis, especially when your marketing budget is tight, the goal is to attract customers.
When planning your digital marketing strategy during a recession, you may need to narrow your goal to focus on a particular niche within your audience, or perhaps even a new niche that has emerged. Find out what your clients need right now and adapt to their needs.
You should also separate your email lists based on any new patterns and redirect your website visitors to attract the right audience and get a higher ROI on your marketing efforts.
7. Various components of your ads
Test variations of ad text and landing page, button colors, image (s), keywords, ad placements, channels, and test and vary everything. But remember, in each test loop, only change one thing to be able to determine if the change worked or did not work. A / B testing is essential in a digital marketing run during a recession as it can help you fine-tune your ads on social media and on Google. If you do not know how to do A / B tests, go to your agency, it is a technique that every serious agency must know and be able to execute.
So, don’t stop doing digital marketing during a recession.
There is no question that digital marketing during a recession is challenging, especially since your feelings tell you that all spending should be reduced or eliminated. Add to this the change in customer behavior, and the situation becomes even more chaotic.
You must keep your budget optimized and realistic but continuous and consistent and be smart about a business offer that gives you profitability but is useful for the current needs of your customers.
See this as an opportunity, an opportunity to provide potential customers with what they need most in a recession, position yourself better against them, gain space against the competition that minimizes their promotion and build the loyalty of your current customers.
Stick with your marketing budget. After all, digital marketing during a recession will be one of your key survival and recovery tools.
Get accompanied by an agency
It is understood that, in the dilemma of saving on expenses and costs, many companies want to remove the digital marketing agency and do it at home. Do not do it. Do not think that because you are the CEO, you have all the answers , the reality is that you do not have them and now more than ever, you need expert support. There is no way that you or your people can run a campaign with the same effectiveness and efficiency as an agency. Although you would save on fees, your marketing budget will be wasted and, above all, you will lose time, valuable time that, if taken advantage of by your competition, will cost you loss of customers. Prospect Factory can help you with your digital marketing during a recession, give us a call.