In 2023, the economy has been notably uncertain. Even though economists haven’t officially declared that we’re in a recession — traditionally defined as two consecutive quarters of economic decline — many people are feeling disquieted.
Keeping this information in mind, it’s a good time to start thinking ahead about what your business needs to do to survive a recession. You want to think proactively, not reactively, so you’re not forced to make big decisions during a stressful time.
We’re here to help you do just that.
The answer to recession-proofing your business is in your marketing budget. Many business owners want to cut expenses during a recession and often cut their advertising first. In reality, continuing to advertise during a recession is key to keeping your business afloat.
If you keep up your advertising efforts (or even increase it, if possible), your business can increase its sales and market share. Here’s why:
When consumers notice the warning signs of a recession, they’re going to react – especially if they’ve experienced a recession before or, in the case of Gen Z, witnessed their parents experience the financial repercussions of one.
During a recession, consumers prioritize what they buy based on these four categories:
What items are purchased also depends on where the consumer stands psychologically, which you should always take into account. For example, if someone is worried about making rent, their figurative cart will look a lot different than someone’s cart who is secure, but acting cautiously.
Think about your business’s products and services and where they fit in to those categories for your consumers. You may want to change your ad campaigns or strategy accordingly.
Now that we’ve talked about advertising during a recession and how consumers react, it’s time to dive into how your business should remain constant during a recession.
Ignoring the fact that people are feeling wary is the wrong move. Instead, mention it in your brand messaging. Of course, you don’t want to turn things into a doom and gloom fest, but still make sure to mention what consumers are getting for their money.
For example, if you sell a luxury product, your focus should be on consumers letting off steam or finding a bit of relaxation during tough times, and how your product gives them the chance to do just that. Plus they’re making a long-term investment.
Showing awareness and sensitivity to the consumer situation promotes a sense of community that discounts and deals just don’t foster.
When you position your company as an ally of the consumer during tough times, rediscovering your brand as you do so, the consumer will understand that you’re committed to them. You want brand messaging that reinforces an emotional connection with consumers so your company conveys empathy.
If sales are declining and you need to meet your goals, don’t take the easy way out and raise your prices – that will not put you in good graces with the consumer. Instead, use loyalty programs to reward big, one-time purchases and frequent, small purchases alike.
Or, you could start promoting the causes you support, as that’s a surefire way to promote an emotional connection and increase trust with the consumer.
Keeping a level head and committing to a long-term marketing strategy will help you reach your goals, stay afloat in the downswing, and flourish when things get good again. Always make sure that you have the data to back your marketing spending, and don’t ever slack on tracking or reporting. Pay attention to your data, share it with the team, and stay flexible so your company can adapt its plans to reflect your insights.
What we want to do as business is reach the right people at the right time when they’re in the right mindset, so they can follow through with the action that we want them to take. When we complete that reach, our businesses thrive even as budgets tighten and the landscape becomes more diverse.
By having good products and great communication, you supply the consumer with worthwhile things to talk about. By maintaining a level head, you’ll keep your business going strong even during a recession, and come out better on the other side.
If you like a challenge and a payoff, then you’ll enjoy marketing during a recession – you’ll experience opportunities for growth that you won’t see in a normal economy. But, in order to take advantage of those opportunities, you need to put in the effort and be smart about the how, where, and why of your marketing message.
If you need help clarifying a marketing strategy that will boost your business during the recession, Federated Digital Solutions can help. Reach out to us today to clarify your goals and brighten your business’s future.
As a digital marketing consultant for Federated Digital Solutions, Nicholette is trained in all aspects of digital marketing and strategic planning. Her passion is helping her clients identify their goals in marketing and customizing a strategy that fits those goals. In addition to the customized marketing plan, Nicholette loves to help analyze the data from the reporting to help her clients utilize that information to better improve their overall marketing to help them bring the best ROI for their business.