Marketing In An Era Of Inflation

In An Era Of Inflation, Focus On Retention

It’s rare that I look at the world with any sense of gloom.

As far as I’m concerned, there’s way too many fascinating innovations out there to be gloomy about anything. But even I have to acknowledge that many companies are doing it tough right now, and it can be hard to know what to prioritize to grow a business.?

This is a time where the world is facing some pretty significant challenges.

Global inflation is forecast to reach at least 7.9% during 2022. Lingering pandemic-related supply issues as well as emerging supply problems from the war in Ukraine have placed extreme pressure on companies, who are already trying to navigate stark changes in consumer behavior.?

When it comes to growth, companies really do need to get to grips with the changes to marketing practice and to customize their marketing strategy to ensure retention of existing customers.

In this article, I’m going to take you through some of the ways companies can ride the wave of global inflation and still come out on top.

Why Focus on Retention?

Inflation does basically two things - it increases the price of goods and services and it erodes purchasing power.

Now increasing the price of services is not necessarily a bad thing, particularly if it happens slowly. But when you have rapid inflation you have a wary market of buyers of goods and services. That makes it harder to sell to new customers, and it even makes existing customers question the value of their ongoing costs.?

This is why you should absolutely focus your marketing around retention of customers.

Not only are you more likely to retain revenue, but you’re also likely to generate more customer stories and case studies that will be useful in generating new sales anyway.?

What does a customer retention strategy look like?

Let me make one thing very clear: a customer retention strategy is not just about discounts and loyalty programs.

In fact, customers really don’t value points based customer loyalty programs anymore.

They are not completely dead, but their value is really limited, unless they are tightly integrated with service packages and partnerships.

Instead, customer retention programs are really now about mobilizing advocacy networks.

What does that mean?

It means finding contexts where you can connect up your customers for mutual benefit.

This could mean running online workshops, or creating content for videos and podcasts where customers can share their insights and issues that need to be addressed. It’s a problem solving strategy that transforms your customer base into an army of advocates.? And it’s a form of conversational marketing.

You use digital media and events as a space to meet more informally and to explore issues together.?

What other changes are happening to marketing practice?

There are some other changes that are making an impact.

Artificial intelligence and marketing automation are making it easier to predict when a customer is going to need you to take a more hands-on approach to servicing.

They are also helping to drive customer engagement and content sharing.

As part of a retention strategy, these tools give you the power to double down on customer experience sharing, while keeping costs of marketing measurement and communication to a minimum.

Then there’s things like the metaverse - a virtual space where more conversations and interactions can happen. Marketing is adapting to this hybrid of the digital and the physical, and conversations are the medium for marketing messages and advocacy.

?So amid all the gloom of inflation, there’s a lot emerging that’s particularly social and conversational.

That’s all good for a retention strategy.

What’s next?

Inflation means that costs will go up for us all - businesses and customers alike. But if you can tap into emerging tools of automation while also creating conversations between customers and companies, you can ride the inflation wave while generating greater trust and advocacy among your customer network. And by focusing on retention while times are tough, you’ll generate the kind of content that’s going to stand you in good stead when it’s time to get back to acquisition.