How to create a winning game plan to score big in a recession
As inflation numbers continue to rise and the Fed increases interest rates to fight it, fears of the looming “R” word are keeping marketers and C-suite leaders up at night. Like any good business people, they’re asking themselves questions like, How can I recession-proof my business? Is my brand one that consumers see as essential to their daily lives? Are we nimble enough to pivot at a moment’s notice?
The Harvard Business Review outlined segments of consumer purchasing behavior that every recession creates, ranging from the extreme—reducing all types of spending entirely—and on to merely delaying purchase of big-ticket items. But let's think in bigger terms. Let’s think about getting to the WIN—the “What’s Important Now.”
If we learned anything from the Great Recession of 2008 and the COVID-19 pandemic that locked down the world in 2020, it’s that marketing matters. With uncertainty clouding forecasts for the rest of this year and into 2023, here’s what brands need to know to win in an uncertain economy.
A little football analogy here wouldn’t hurt. Let’s think about how to win in a possible recessionary gridiron environment.
1. Getting to the WIN
In preparation for gaining ground during an economic recession, each brand should be evaluating “What’s Important Now” (WIN). Creating a winning game plan is important because strategic increases in marketing investment during a recession tend to improve financial performance throughout the following year. Plus, it’s often done at a lower cost than in a non-recession economy.
Though cuts to marketing are often the first play for companies avoiding layoffs, this simply acts as a short-term solution and creates a wealth of future fumbles, such as lost market share, eventual layoffs and a worsening financial picture. The smartest brands are contrarians, choosing to tilt these opportunities to their favor.
2. Kickoff assessment
Take an honest look at where your brand is today. Do a side-by-side comparison of the products and services you provide, where are the outliers, who are the top performers and who are the lagging performers. Then, increase promotion.
Take another look at your core customer and how they’re changing. Has the way they use your product shifted? Are you essential to their daily lives or a simply a reprieve? Do the same assessment exercise with marketing tactics and platforms. Pour resources into the channels that consistently deliver and eliminate those that are underperforming.
3. Call audibles
Now is the time to take new concepts off the shelf and create actionable, real-world launch plans that can be implemented at a moment’s notice. While innovations like curbside pickup were not born out of the pandemic, they did see exponential growth overnight and are credited as the reason many restaurants, grocery stores and others were able to continue doing business during lockdown. Nimbleness is key.
4. Play your game
Another challenge brand marketers will need to address head-on is the need to build trust and credibility. In an economic downturn, consumer confidence is expected to decline. Don’t ignore it. Speak to it. Be ready to redefine your brand’s value proposition. Make the case for why your brand is the best option out there at this time. Create the story and tell it in as many places as possible.
Expect to increase your share of voice by maintaining your marketing spend or increasing your investment to capture market share from those competitors who pull back to a prevent defense. If you take the right game-plan steps, the dreaded “R” word doesn’t have to be so scary. In fact, it might present opportunities for your business to grow and change and find new consumers and markets. Start by understanding the basics of recession economics and marketing, and make a plan not only to safeguard your business but also to invest in its future.Source: adage.com