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Marketing In A Recession

Jul 25, 2023

There's no denying it's a challenging time out there right now for small businesses. You've probably been wondering how you can improve your marketing efforts to withstand the affects of a recession. During economic downturns, consumers tend to become more cautious with their spending, making it crucial for businesses to adapt their marketing strategies to cater to changing consumer behaviour. I've put together a list of 5 ways to 'recession-proof' your marketing.

WHAT IS A RECESSION?

A recession is defined as two consecutive quarters when gross domestic product (GDP) shrinks.
Here in NZ, a 0.1 % fall in gross domestic product in the March 2023 quarter followed the 0.7 % contraction in the 4th quarter of 2022. Which means New Zealand is officially in a 'recession' by the slimmest of margins!

Other environmental factors have also impacted the New Zealand economy however:

The lingering impact of the pandemic
Increased cost of living
The impact of floods/cyclone in the North Island
And it's an election year!

So how can you adapt to not only survive the recession, but ensures your business thrives during this year and for years to come?

1. ADAPT TO SUIT THE CURRENT ENVIRONMENT

Understanding how your audience may be feeling and acknowledging the impact of the downturn on their lives is essential. By resonating with their concerns and challenges, you can tailor your content and your offers to address their needs effectively. Brands that emerge successfully from a recession are the ones that resonate with their audience.

Adjust Your Messaging

Be aware of how your audience may be feeling
What impact will the economic downturn have on them?
Consider what changes you might need to make to your messaging and content?
Brands that win will find ways to resonate with their audience
Don't be tone deaf to what is going on in the economy / environment for your audience

Streamline Products/Services

Create efficiencies in your business wherever possible
Work out which products/services are the most profitable
Work out which products/services will be most needed right now
Consider offers that are lower cost but high perceived value
Adapt your offers to suit your market's needs

2. FOCUS ON THE MONEY

Strengthen your finances by re-evaluating your expenses and income, can certain things be tweaked or streamlined? Start by reviewing your business expenses in detail to identify areas where cost savings can be achieved. Look for opportunities to streamline operations, or find more cost-effective alternatives. Then look for ways to increase your income coming in.

Offer Payment Options

Afterpay / Laybuy
Payment Plans
Deposits for big projects
Encourage early payment
Consider your cashflow as well as customer preferences
This is one of the ways you can show you understand what your customers are dealing with

Review Your Expenses - Dollars Out

Assess where you're spending money on marketing
Remember monthly/yearly subscriptions for tools
Assess the ROI (return on investment) for all your marketing activities
Cut costs where you're not getting bang for buck

Increase Sales - Dollars In

More sales from current customers
More sales from new customers
Offer new products/services to current customers
Offer new products/services to new customers

3. FOCUS ON YOUR CUSTOMER

The customers you've already got are more important than ever! How can you improve the customer experience, provide more value and ensure your customers return again and again. Analyse and enhance interactions at every stage of the customer journey and make sure you have an understanding of the needs of your audience.

Improve Customer Experience

Consider how your customers interact with your business at every stage of the customer journey
Understand your audience and what matters to them
Prioritise customer service
Ask for feedback
Personalise your interactions with customers

Focus on Customer Retention

By creating meaningful experiences that cater to your customers' needs, you can build lasting connections that lead to loyalty and advocacy.

Where in the customer journey can you delight, surprise and make your customers feel valued?? Eg. Post purchase gift / Email thank you + discount code / service that goes above and beyond

How to do you communicate with customers post-purchase? Eg. Follow up email / Reminders / Thank yous
Loyalty and referral programmes

Communicate Your Value

Show you understand your audience by speaking to where they are AT RIGHT NOW in your communications - before they buy from your business
Show your value - your business can solve those issues they're struggling with
What is the transformation people get with your product / service and how does it impact their life?

4. BUILD YOUR BRAND

Leverage your brand's unique set of attributes and strengths that differentiates your business from competitors. Reinforce this in your brand messaging. You can have a powerful product or service, however your branding is your strategic tool which will make you stand out and build long term customer loyalty.

Why brand building is important in a recession

You need to stand out when customers are being selective
A strong brand strengthens customer loyalty and builds trust
Long term sustainability - remember an economic downturn is temporary
Strong brands can pivot during tough times without losing their core identity

Create a competitive advantage

Be consistently recognisable & memorable
Use consistent messaging - repeat yourself
Understand your unique value proposition: the unique ways that you deliver the value through your products, services, spaces and people
Create an emotional connection - share your story
Quality creative that emphasises your unique value

5. TAKE CONSISTENT STRATEGIC ACTION

As tempting as it might be to halt marketing spend and activities, don't stop! Instead get more strategic and intentional. Even the most well-thought-out plans may require adaptation, so assess all of your efforts closely so you're really maximising each step.

Keep Marketing

Don't stop doing marketing activities altogether - just make adjustments as needed
Others may stop so it is an opportunity to build momentum and brand awareness when others don't bother
Keep that marketing wheel spinning - we need to do multiple activities at once to make an impact

Focus on Sales Generating Activities

Forget the 'busy work' - get real about what actually works and do more of that
Assess the effectiveness of all of your tactics - ROI / ROAS
Invest selectively - both your time and money
Keep it simple and do the things that make an impact - follow up, make phone calls and send emails

Use Strategy & Planning to Your Advantage

Get really clear about HOW you'll market your business
More important than ever to not be marketing on a whim - spend your time and money wisely
Have a plan but be adaptable

By staying proactive, adaptable, and consumer-centric, you can navigate the ever-changing business environment successfully. In these challenging times for small businesses, it's crucial to adapt your marketing efforts to tailor to your audience in these uncertain economic times.

If you'd like to find out how you can level up your marketing for success, book in a FREE Discovery Call with me.

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