How to Market your business in a Recession???

“Be fearful when others are greedy and be greedy only when others are fearful.”

– Warren Buffett?

In today's edition, we are going to talk about every marketer’s most dreaded word ––

????RECESSION

Before we start panicking, it is important to understand the exact definition of recession and?take a look?at the history of this phenomenon.?The?technical definition ?of a recession is marked by a “slowdown of economic activity that’s more precisely defined by at least two quarters of negative growth in the economy”.???

The role of marketing is essential in such?a?crisis for?a few?reasons?–?to?reduce the severity of the downturn or the extent to which your growth slows;?to increase your business during the upturn once the economy starts to recover; and ultimately, it can shorten the duration of the recession’s effects.

I have worked through 3 major economic downturns and in each I have seen the brands that continued to spend on marketing (with some changes in message, channel, budget allocation) succeed and sadly I have seen many businesses close after stopping their marketing activity.?Sure, marketing spend is easier to cut than other operational costs, but it is not the smartest budget to slice in difficult times.

????What can you expect in a period of recession?

Right now, nobody can predict the intensity or duration of the economic downturn. The best way to prepare is by looking at historic data and being mentally ready to handle this crisis. Below are a few things you can expect to encounter when things get tough.??

1. High Returns on Low Market Investments

Marketers should always be transparent about the results their?marketing campaigns?are bringing in. Are they proportionate to the investment made? Expect this pressure to perform to intensify. Sales processes will also slow down and expectations from the marketing team will increase manyfold, despite budget reductions.??

This period will be exhausting for marketers. In such a situation, you have to make sure that the Customer Relationship Management systems your company use (such as Salesforce or Hubspot) are solid. Be sure your CRM has the reporting tools you require to demonstrate the return on your marketing investment. The duration of conversion cycles will also increase as customers will be extra cautious of where they spend their money. Read my article on?best marketing automation tools ?that might help you overcome these difficult times.

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2. Increase Advertising Budget?

Spending on advertising?plummeted by 13% during ?the Great Recession. This move is understandable as it seems to be the safest choice – for example, stopping advertising does not affect any major attributes like the quality of the product or its distribution. However, businesses must realise that the quality of products, services, and processes are of no use if nobody is able to discover your business. During this time, there will be less competition in advertising, so you may be able to buy more advertising space for the same price, and your ads will be more visible. This will increase the possibility that your target market will recognise and remember your brand.?

You must be familiar with the expression “out of sight, out of mind”. During a recession, the last thing you want is people forgetting your business. Businesses that continue to market themselves during a downturn stay in consumers’ minds; when consumers have money to spend again, they naturally gravitate toward these brands.?A great example of a company that benefited from increased advertising budget during a recession is Del Monte.

3. Authentic and Effective Marketing?

Consumer confidence will decline as a result of economic deprivation. The way to stand out here is not by pushing advanced features of your product but instead, its value in terms of return on investment (ROI). I always talk about how marketing should be authentic, especially when consumers have a lack of confidence in the market. They do not need fancy products during this time, but cost-effective products that will help them maintain their desired standard of living. Give them raw data and value-based facts that convince them to get onboard with your product. The case study below demonstrates the importance of authentic marketing, which helped Amazon not only stay afloat during the Great Recession, but also to thrive.

????What can you actually do?

When entering a recession all marketers should be looking at their performance and ensuring they can justify the ROI or long term benefits of each as they are sure to be asked these questions.?Demonstrate real value and ensure that your budget holders cannot cut you back at the time when you need to be adding value.?

What’s the way out of recession for businesses? Simple, progressive ideas and the courage to do something different. An economic crisis is a time where rather than playing it safe, you should take some risks. And as marketers, we have to believe in ourselves and take a leap of faith.

Remember the proverb, “those who cannot remember the past are condemned to repeat it”.

Research deeply into past economic crises and learn from companies that bloomed during such times. Although this economic downturn will pass, how you handle it will determine whether or not your company survives. The bottom line is that in this unstable economic climate, you must either boost or retain your marketing expenditure. After all, the only form of marketing that works is continuous and persistent, making sure your brand stays in the forefront of consumers’ minds. I’ll conclude with the wise words of Peter Drucker –

“Marketing and innovation bring results; everything else is cost.”?

Read more about marketing in recession on my blog.

Tune in as Oliver Duffy-Lee gives away his secret to maintaining authority online and his guide to growing a B2B business through social media.

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ABOUT ME?

I have been helping companies with their marketing from start-ups to global corporates for over 20 years and I’m also the author of 2 best-selling books in the field. Whether it’s growth, branding, performance, content marketing, SEO or many other areas, I have helped companies all over the world to deliver market-leading results. I’m also the CEO of a global marketing agency, and a regular keynote speaker, trainer, consultant and contributor to industry publications.