Whether we are in a recession or not, and experts say it’s surprising we aren’t yet in a recession, times are definitely tough. With the government’s bailout signed last week, the stock market plummeted and is likely to take up to 5 years to bounce back.
With people not being able to borrow money as easily before, and we are a nation of borrowers, it’s tempting for many businesses to stop marketing and to use their marketing budgets for other business costs. But unless you really need that marketing money in other business costs, it’s best to keep marketing. The economy will eventually bounce back and people will be borrowing and buying again. Many people are still able to purchase goods now, so don’t leave those people hanging.
What needs to be done now is to change your marketing approach, but still market. When creating your marketing plan for next year, here are some factors to keep in mind that will help you market successfully during this hard time.
1. Keep researching your target market. You knew your market last year or whenever the last time you conducted research, but now times are different and your target market’s spending is probably different. You need to know how consumers are responding to the imminent recession. Consumers are negotiating more than ever and are willing to trade down, postpone purchases or just buy less. Interest in new brands disintegrates in a recession, so focus on your current customers rather than look for new ones.
2. Focus your marketing on family values. More people will stay at home with family and friends during hard times. Use marketing scenes that show cozy home scenes with family, rather than adventurous destinations that people can’t afford to travel to. Telephone use, home entertainment and home furnishings will likely hold up well in this economy as more people stay home.
3. Maintain your marketing spending. It has been documented that brands that up the marketing effort, or at least keep it level, during a recession can improve market share and ROI at a lower cost than during a good economy. This is because those that can, do. Those that can’t – your competitors – fall away from the front lines, allowing room for you. If you must cut back, try to keep the quantity of ads up, but switch to cheaper ads – switch 30-second ads to 15-second ads and use radio ads instead of TV ads. Just keep your name out there, even if you can’t do it in the same capacity as before.
4. Alter pricing tactics. Customers are looking for good deals now. They want quantity over quality now because they need to make their dollar stretch more than ever before. Offer more sales and discounts, and price smaller packages more aggressively. When people don’t have as much moolah to spend, they concentrate on price more than promotions such as mail-in offers.
5. Alter your product line. You may need to favor and market multi-use products over specialized products because people want to get the most for their money. Gimmicks won’t work during a recession; you need reliable, durable, safe products that have shown to perform well in the past. Your marketing image should stress price for performance rather than a favorable corporate image.
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