Tips to make the most of your marketing budget during a recession
Marketing is a major expense of companies, although, practically, it should not be, as every penny you invest in marketing returns to you in terms of benefits like conversions, increased traffic and increased overall brand exposure.
Things that are working today might not work tomorrow – after all, nothing lasts forever. When the dynamics of the business world and the economic world transform, you will have to change your marketing strategies.
Even though marketing is regarded as an investment rather than an expenditure, publicising it does not make sense when the demand is low. Of course, you will have to check out what is working and what is not and accordingly, you will make a marketing strategy.
For instance, if you are a private lender that provides a personal loan with noguarantor, you will have to stop marketing these loan products when the economy is going through a recession. Most of the people will be unemployed and on a tight budget.
Of course, they would have put their big plans like vacation, home renovation and the like on the back burner. Not many people will be keener on applying for a personal loan. The demand will switch to unemployed loans, and so will your marketing strategy.
Why and why not do you need to slash your marketing budget?
During an economic downturn, earnings do not rise proportionately to the soaring prices that restrict the buying power of consumers. People switch from a spending mindset to a saving mindset. All of a sudden, they start putting off expenses and start stashing by. During the recession, people will tend to spend on only essential things.
If you continue to stick to the same type of marketing strategy, your penny will go down the drain. The reason is simple: you are marketing a product or service that does not have high demand in the current scenario.
First, you need to analyse the demand for a product or service. You cannot market blindfolded. But the fact is that the demand is weak, and it will revive as soon as the boom hits the economy. Only the focus has shifted. So, does that mean that you should completely stop the marketing of things that do not have much demand?
Taking the example above, the demand for unemployed loans and small emergency loans will be high, but some people are still cash-positive and would like to apply for personal loans with no guarantor.
You can whittle down your marketing budget while taking a helicopter view of the situation. Still, a detailed analysis will reveal that it could be detrimental to the overall success of your business.
For instance, your internet presence will lose strength if your competitors do not stop marketing the same product. You will struggle against your competitors when the economy recovers from the recession.
You can continue spending the same money. This will prove to be advantageous when the market recovers. If you are floored, there is nothing to worry about, as there are ways to make the most of your marketing budget without hampering the success of your business.
How do you save money on marketing without affecting your business?
Absolute cutting down on your marketing budget is not a solution. Here are some ways how you can save money on marketing without affecting your business at all during or after the recession:
· Leverage digital marketing
Digital marketing is the best and most effective way when it comes to saving money in marketing your products and services, especially during the recession. PPC, for instance, is flexible and measurable. In addition, you can keep maintaining your social media presence.
For instance, if you provide personal loans and you have noticed an increase in the demand for unemployment loans and emergency loans, you can limit to social media and PPCs for personal loans. However, the other aspects of digital marketing should be used for unemployed or emergency loans.
A few guest posts and blogs are still necessary even though the demand is not much. This will help you maintain your online presence and fight for a higher rank in search results when the economic situation improves.
· Narrow down your audience
You must have a customer segment like other businesses. Now is the time to relook at your audience. Try to divide your segment into three categories:
· Hardest-hits who will stop buying anything other than necessary products as they are hit financially due to the recession
· Planners who will likely be willing to maintain their living standard
· Well-offs who do not need to slash their budget at all
· Unperturbed customers who do not get affected by the economic scenario. They would buy what they want.
Now you should frame your marketing strategy targeting people who are well-offs and unperturbed. It may include the scope for planners as well.
· Be versatile with your marketing strategy
Introduce versatility in your marketing strategy. Find out how you can reach out to your customers by using cost-effective marketing strategies. Use a video marketing strategy. Try to embed the link to the video on your website's social media platforms as well along with your YouTube channel. Find out how you can get the maximum benefits from the strategy you use.
Remember that a recession is just a temporary phase. You cannot afford to treat marketing so casually by reducing your marketing budget. Once the recession period is over, you will see your business bounce back.
The final word
It might make sense to slash your marketing budget during an economic downturn, but it does not mean that you do not need to invest in marketing at all. Absolute slashing will take a toll on your business. You should instead try to reframe your marketing strategy.
Target customers who want to buy your products and services despite the recession and use digital and cost-effective marketing rather than traditional marketing methods.