Lars Lehne is Global CEO of Incubeta.
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As a marketer heading into 2023, you’d be forgiven for thinking that there may be challenging times ahead. The cost-of-living crisis is reducing consumer spending, inflation rates are higher than they’ve been in decades, and it looks to be fairly certain that we’re heading into a global recession.
With brand marketing traditionally being one of the first budgets to receive the cut, it’s no wonder that this trifecta of doom and gloom is sparking concern for marketing teams around the world. But marketing is so much more than brand awareness. And with challenge comes opportunity.
You only need to look as far back as the pandemic to see how positive outcomes were born from an otherwise bleak prospect—leading to rapid advancements in digitalization, increased flexibility in the workplace and a reestablished sense of community.
As inflation continues to rise and we head toward possible recession, we should be looking at what led us here and how we can best tackle the situation at hand. The digital progress made in the past few years isn’t going anywhere and consumers will continue to embrace digital convenience, only with a more balanced approach and higher expectations.
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Prepare Your Organization For Success
The worst mistake companies can make during this period is to cut down on customer experience and the quality and delivery of their marketing. The increased focus on digital during the pandemic led to ever higher expectations among consumers and failing them is lethal—with customers unforgiving toward those that aren’t improving their offerings post-Covid.
Avoid repeating this mistake by doubling down on digital marketing and increasing your adoption of digital technologies. Focus on providing consumers with excellent experiences and quality. By doing so, you can ensure your brand not only remains in front of your customers but also becomes a positive influence during these difficult times, reinforcing brand values and strengthening the consumer relationship.
Avoid Cutting Your Marketing Budgets
This may sound salesy, and perhaps rather biased coming from the CEO of an international marketing agency, but I’d recommend avoiding cuts to the marketing budget if possible.
Firstly, it has been demonstrated time and time again that companies that continue to advertise during a recession see a better recovery on the other side. In fact, during a study on recessions, McGraw-Hill research revealed that those that maintained or increased advertising expenditure during a recession saw sales rise by 256% over those that didn’t.
And secondly, recessions actually provide a good opportunity to get your brand out there. As other companies reduce their marketing spend, the “noise level” from other brands in your category also reduces, alongside the cost of ad space, meaning your voice is more likely to be heard while you’re spending less money.
Of course, this may not be a viable option for all businesses, and if cuts need to be made to the marketing budget, it doesn’t necessarily mean disaster. But for those that can, increasing or maintaining marketing budgets may affect your profit margin in the short term but can also provide you with the advantage on the other side of the crisis.
Invest In New Marketing Technologies
It may also seem counterintuitive to be making further investments in times of financial unease, but with the rapid digitalization spurred on by the Covid pandemic, now is the time to start rethinking your use of technology.
High street shopping may have seen an increase post-pandemic, but the number of people shopping online is continuing to grow at an accelerated rate. The rise in digital buyers has also led to widely accepted and used digital patterns, which means higher expectations from customers and little room for error.
As we head toward a privacy-first, cookieless digital future, we are tasked with ensuring that we can keep reaching and delighting our audience with the right message at the right time while respecting their right to privacy and transparency. In order to do so, marketers need to invest in omnichannel marketing and first-party data strategies so they can meet customers with relevant marketing during and following the recession.
Focus On The Right Message At The Right Time
We’ve all heard the famous quote, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half,” right? It was first said by John Wanamaker, considered by many to be a pioneer of marketing, and summed up how measuring the success of marketing was vague and imprecise.
That was, however, around the 1920s, and fortunately, marketing has since changed. Digitalization has helped those in marketing to identify where money is being wasted, or at least how effective the actions that they’ve spent their money on are.
Ensuring your messaging isn’t going unnoticed or having a negative effect on your brand requires data that shows what resonates with your audience and has the desired effect. For this to be actionable, you need a proper tech stack and a solid understanding of analytics so that you can interpret and operationalize the learnings.
Remember There Is Opportunity In Recession
While there may be some difficult times ahead owing to the rising inflation and looming recession, there are still positives that can be found.
By continuing to invest in marketing and communication, adopting new digital technologies and using data to establish the right messaging for their customers, brands can continue to thrive during these economically difficult times, as well as laying the foundations for growth on the other side.
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Author: Lars Lehne, Forbes Councils Member
