I read a dozen guides on marketing in a recession (so that you don’t have to) ?? ...Here’s what I learned ??

So you might be thinking to yourself… “Ben, what’s a recession, and why should I care?”

It’s okay, I’m going to give you the 15 second summary. If you’re in marketing/research/media, you’re definitely going to want to hear this.

A recession is when “economic activity” slows down significantly for an entire market — that includes a decline in retail sales, manufacturing and production, employment and income, and more. They can last months or even years.

And today many markets around the world are on the edge of recession… there’s been some economic slowing that doesn’t seem to have an end in sight.

Why does this matter for marketing? Well to answer this question, I read a dozen evidence-based guides and articles from around the internet and summarised them to save you the time (thanks to Lindsey Clay for curating the list of resources).

(Also thank you to all of those I sourced at the end for sharing their experience and insight freely with the industry through research and thought leadership content: Allison Schiff , Candace Nelson , Peter Field , Ehrenberg-Bass Institute , Mark Ritson , Mike Campbell , Robert Cardarelli , Nirmalya Kumar , Prof. dr. Koen Pauwels , and more)

I’ll summarise for you below:

1. Predicting the unpredictable

The truth is… recessions are unpredictable by nature, but what we do know for sure is that when the economy slows down, people's behaviour changes (yep those same people you’re trying to build brand salience with). That means marketing efforts need to be adaptive as well. The same old strategy is unlikely to get the same old results.

2. There’s no ‘one-size-fits-all’

A single strategy isn’t going to work for every media agency or brand. There are some learnings that are useful for the majority, but not for everyone. Case in point: during the global pandemic, if you were a holiday travel company optimising toward performance (i.e conversion, acquisition, etc.) then you would have had a tough time, but if you were in the business of selling face masks… this is the exact approach you should have taken.

3. Your primary focus: survival

Your primary goal in the short term is to survive the recession with the least number of casualties on the other end. Your secondary goal should be to capitalise on reduced costs of media (cost reduction driven by oversupply and reduce demand of paid reach) to secure a competitive advantage. Consider maintaining or increasing your share of voice (SOV) to secure a leg up at reduced rates.

4. Brand > performance

Consumer spending is going to be at an all time low, so leveraging towards performance based marketing is likely to result in a lot of wastage (unless your survival depends upon it). Instead, focusing on brand advertising can help to maintain market share and bounce back faster post-recession. Brand-building will also see you through to recession recovery. This may mean a short term reduction in profit, with longer term growth and profitability.

5. Switch up the message

While your product or service is the same, the people you’re trying to engage with have changed. They’re likely no longer big spenders and now focused on both budgeting and reducing discretionary spending (travel, property, automotive, electronics, etc). It’s time to rethink the message you’re taking to market and adapt it to the new budget conscious consumer. People will be doing it tough so it’s also worth focusing on themes of “humanity, warmth, generosity, and humour”.

6. The 'pricing differential'

Product pricing strategies need to be more considerate of alternatives from competitors. The difference between the price of your product and the next will become the focus of customers. It’s important to stay within a safe pricing differential to maintain market share. It's also challenging to reset consumer expectations on the other end of the recession if promotion or discounting is the only pricing strategy employed in tough times.

7. A media plan shakeup

Common sense tells us that if you’re spending less on the unnecessaries, then your habits are likely to change. That includes media consumption — no longer forking out on that theatre show? Maybe you’d rather stay in with family or friends and stream a movie on a Friday night to save some money. The channels that worked to reach people in the past are likely going to grow/decline or evolve in terms of niche segments. It’s time to reevaluate that media plan.

8. The big brand advantage

Big brands that were already large and growing before a recession tend to get an easier run than smaller brands: the impact of reducing brand advertising during a recession is lesser; they typically have more resources/financial buffer to weather the storm; and they also have more opportunities to increase brand advertising during a recession to grow market share.

A final thought…

At the end of the day marketing is always a bit of art and a bit of science. This is no truer than during a recession and periods of uncertainty. For that reason marketers need to stay flexible, keep a finger on the pulse of the consumer, and consider balanced risk and diversifying your marketing strategy.

?? Have an idea to help marketers in a recession? Let’s hear it in the comments below.

?? If you enjoyed this article, please like and share with your network.

Sources:

https://www.adexchanger.com/strategy/s4s-sir-martin-sorrell-brand-marketers-your-budgets-are-gonna-get-cut-during-the-next-recession/

https://fortune.com/2022/08/03/building-brand-recession-startups-founders-consumer-spending-behavior-success-candace-nelson/

https://www.dhirubhai.net/business/marketing/blog/linkedin-ads/advertising-in-recession-long-short-or-dark

https://cdn2.hubspot.net/hubfs/2235762/Coronavirus/Week%208/System1_PeterField_Week8_Webinar-compressed.pdf

https://the-message.ca/2020/04/23/peter-field-on-why-its-important-to-keep-advertising-during-a-downturn/

https://byronsharp.files.wordpress.com/2008/07/recessionbyron.pdf

https://www.marketingscience.info/when-brands-stop-advertising/

https://www.marketingweek.com/ritson-recession-playbook/

https://www.marketingweek.com/mark-ritson-marketing-spend-recession-coronavirus/

https://www.ebiquity.com/news-insights/viewpoints/advertising-through-a-recession/

https://www.ipsos.com/sites/default/files/ct/publication/documents/2020-04/ipsos_mma_media_strategies.pdf

https://hbr.org/2020/08/dont-cut-your-marketing-budget-in-a-recession