Whether you’re in the camp that believes a recession is coming or among those who feel it’s already here, the basic facts are indisputable: Sky-high inflation, rising interest rates and growing global uncertainty have led consumers to begin monitoring their bank accounts and clutching their wallets more tightly than just a few short months ago.
According to Deloitte’s 2022 State of the US Consumer report published in July, planned discretionary spending is edging downward, while the number of consumers choosing to delay large purchases is trending sharply upward. And, of course, businesses large and small —are also being buffeted by the same economic headwinds and have begun sharpening their budget pencils and lowering expectations. We’ve already begun to see workforce reductions at consumer-sensitive companies such as Groupon and Walmart.
As recession concerns grow, the impulse is to slash spending and quietly wait it out — an understandable, but potentially damaging mindset. A “hunker down” mindset when it comes to marketing can open up a vacuum of visibility that competitors may rush in to fill. Perhaps even more importantly, it may stifle innovation that could potentially sustain value when times are tough, and propel growth when the economy perks back up.
At Wilks Communications Group, we help clients capitalize on the unique opportunities that come with shifting consumer and market behavior to ensure their brands remain top-of-mind for customers come what may for the economy. Our formula for success relies on balancing “back to basics” best practices with visionary courage. Here’s how:
Brush up your data dashboard.
When your lean marketing budget meets your consumers’ tight spending budget, every dollar counts. Success begins with making sure you’re clear on exactly how your current marketing investment is performing.
While this suggestion may seem rudimentary, we’re often surprised to learn how infrequently small businesses dive deep into their marketing analytics during times of overall stability and growth. A recessionary climate, however, often doesn’t afford us this luxury. Only by taking a clear-eyed view of current performance metrics can you make wise decisions about where to cut and where to lean in should the need to rebalance arise.
If you have a solid data foundation, this is the time for thoughtful analysis and scenario planning. If your measurement infrastructure is a bit haphazard, you’re not alone. This could be a great moment to establish an intentional measurement framework and consistent reporting cadence to ensure better data visibility down the road.
Step back, reflect and optimize.
Cleaning up data dashboards is just the beginning of a solid approach to recession readiness. We also recommend examining your operational efficiencies using a simple stop/start/continue rubric. Have your routine processes and always-on tactics evolved strategically over time with the business, or are you spending resources on suboptimal activities out of habit? Could you free up bandwidth or budget for new ideas by letting go of the old? What’s working well, and how can you build on it?
This type of blue-sky thinking may even drive innovation beyond marketing to influence product delivery as well. Could you downsize offerings to allow more accessible pricing? Could creative product bundling drive an enhanced perception of value? Is this the time to upgrade your loyalty rewards program or explore subscription models?
When economic pressures force change, we counsel our clients to think deeply and expansively about the shape that change might take. By replacing a “cut back” mentality with a culture where reimagining what’s possible is the norm, you may open doors to prosperity you didn’t even know existed.
Double down on communication.
As consumers grow more cost-conscious, the stakes on messaging rise. Always a best practice, the “three Cs” — cadence, clarity and competitive differentiation — matter more than ever right now.
Cadence: Stay high on the radar by maintaining a steady drumbeat of content to your email list and via social publishing. This consistent visibility telegraphs confidence and reinforces your value through the basic (but powerful!) practice of repetition. The result? Your consumers will be less susceptible to the price-driven switching that’s rampant in times of economic constraint.
Clarity: When communications originate from a crisply articulated strategic brand position, every tactic works harder. Consumers will receive your proposition with compelling clarity every time, and your advertising and PR dollars go further, thanks to the natural amplification effects of rigorous consistency. Keeping messages aligned with your brand’s core value helps sustain that north star positioning at every touchpoint during tumultuous times.
Competitive Differentiation: When discretionary dollars dwindle, it’s essential to give consumers a clear and simple reason why your brand is superior to alternative offerings. Maybe it’s a formula advantage. Perhaps you provide superior service and guarantees. Maybe your brand’s packaging and personality are simply too compelling to discard. Whatever your unique differentiators, we counsel clients to lean into their authentic brand “superpower” at every touchpoint.
Differentiation is your greatest asset and strongest antidote to the purely price-based competition that often flares in times of economic challenge. While some strategic price promotion may be an appropriate tool in your recession marketing toolbox, it must be applied as a complement to — not a substitute for — a substantive competitive stance. Otherwise, the race to the bottom begins… and nobody wins.
At Wilks Communications Group, we specialize in helping startups-to-midstage brands find their sweet spot with consumers to drive business results. If you’re an ambitious marketer with a passion to exceed expectations, we’d love to start a conversation about how we can support your goals.