With 2023 predicted to be a challenging year for consumers, how can brands adapt their campaigns for successful marketing in a recession?
We’ve read the headlines, felt the sting of supermarket prices, and now fear the postman like never before; it’s official, the UK is in an economic recession. In a nutshell, this is due to rising energy costs, the conflict in Ukraine, the effects of Brexit, and supply/demand issues created by Covid.
As of December 2022, inflation is running at 9.9 per cent and is expected to rise further still. But what does this mean for digital marketers? Is marketing in a recession still viable? And how do we sell in an environment where nobody can afford to buy?
We discuss how to fine-tune your marketing strategy to generate business opportunities and gain momentum even in today’s economic climate.
Target the changing needs of your customers
During recessions, consumers have less disposable income to spend. Therefore, they set stricter priorities, eliminating unnecessary luxuries and reducing their overall spending.
So, what are consumers willing to spend their hard-earned cash on? The answer? Products and/or services that are perceived as value for money.
When tightening their belts, consumers tend to scrutinise what they spend their money on. They set priorities and manage their budgets based by sorting their expenditure into four distinct categories. These can be defined as:
- Essentials – These are products/services that are necessary for survival or perceived as central to a person’s well-being.
- Treats – Products/services that are less necessary but nonetheless justifiable and crucial to a person’s happiness.
- Postponables – These are products or services that consumers desire, but put off purchasing until they have more disposable cash.
- Expendables – Items/services that are perceived as unnecessary or an unjustifiable spend.
Try thinking of some examples for each category based on your own spending habits. Chances are, no two consumers are the same; every one of us has different needs, lifestyles, and interests that affect what and how we spend our money.
To capitalise on this principle, why not define your product into one of the above categories? Can your product/service be marketed as an essential? Take a trip to the salon, for example, many of us would categorise this expense as postponable or even expendable when we’re hard up for money.
A clever marketing strategist would adjust their campaign by redefining the category as a treat or an essential. For example, you could argue that a trip to the salon is essential because being well-groomed makes us feel good about ourselves – a little luxury that we couldn’t live without.
To put this into practice, re-write your product descriptions or website copy to redefine your brand. Using strategic language, you can better persuade your customers that your product/ service fits into category 1 (essential) or category 2 (treat). For further reinforcement, emphasise value for money through weekly blog posts or digital PR campaigns.
Rewarding Loyalty
Another focus for marketing in a recession is to reward your existing customers, making them feel special for maintaining loyalty to your brand. During recessions, it’s more important than ever to remember that loyal customers are the primary, reliable source of income and growth.
Offering perks or incentives for your existing customers can be a savvy way to guarantee they keep coming back. For example, you could try offering loyalty members credit or points collection to encourage spending by spreading the cost of their purchases or giving one free item for every 10 purchased.
Positioning for Recovery
The economy is ever-changing and constantly fluctuating. This means marketers have to plan for recovery by maintaining flexibility so they’re able to respond quickly to the upturn when it does arrive.
We recommend continued planning and aspirational pipelines of how you can evolve/innovate your product/service. Most consumers will be ready to try a variety of new products once the economy improves and they, once again, have more disposable income.
Find out more
For more digital marketing insights, read another of our informative articles on the It Works Media blog. Alternatively, contact us today to find out how we can help you improve your digital marketing strategy.