Marketing Strategy As Inflation Rises

Current Situation

Let’s face it, inflation is the highest it’s been in around 40 years. Whether we’re technically in a recession or not doesn’t really matter at this point, because the business impact is real regardless. So with that, it’s important to know the facts and be prepared. These things happen, and as always, they pass! 

We’ve been doing this long enough to know where marketing usually stands in the pecking order…We’ve also seen how business & marketing decisions impact brand stability and long term business growth. With that in mind, we highly recommend maintaining a strong marketing effort even results waiver during this time of instability. 

Many new companies see times like this as an opportunity to fill in the gaps in the market that are created by their competition leaving. Additionally, the brand equity and brand recognition that you’ve built over the years is also at stake. Generally speaking, email, word-of-mouth, & referrals can generate upwards of 50% of monthly revenue and if your business falls off the map, those channels usually falter as well.

There’s no gap to fill or memory to replenish if you never left

When this market rebounds, you will have the advantage of being the company at the forefront of consumers’ minds and retain a quicker ability to scale because of the connections you’ve made over previous months.

General Advice

We’ve compiled some general strategies from our experience and from trusted sources in the marketing community, and here they are:

1. Focus on brand marketing & storytelling more than ever: your key differentiators and consumer value will bring you success.
   • How is your brand/business invaluable to your customer?
2. Create and maintain customer loyalty programs to further your value to the customer and increase referrals (*free* marketing)
3. Financing options when times are rough is a smart business move, online brands can offer new payment options like Afterpay to allow people to pay at their own rate.
4. Create product bundles or discounts (if applicable) for loyal members where you can. 
5. Watch your competitors more than ever. If they pull out of advertising, if they are offering special deals, etc. You can mold your strategies around this. The less competitors, often the cheaper ad auction as well.
6. Evaluate every aspect of your business to assess opportunities and weaknesses. The economy can become an easy scapegoat for all issues, but sometimes that is not the case.
   • Are there products or services that you’re offering that have low margins & high input requirements? How much are they benefitting you?
   • Conversely, do you have room to diversify? How can you expect your business to grow if your product/service-offering hasn’t evolved in years? You’re effectively paying a premium to only go after new business when old customers are still willing to buy from/work with you. 
7. While price increases may be necessary for a variety of reasons, it is important to Approach price increases with caution: during times like this, price increases usually go down best if it’s something happening across all your competitors as well. Otherwise, you’ll be the black sheep. 
8. Evaluate where it makes sense to swap Money for Time. Some overhead or expenses you’re paying for can be done manually or brought internal. Just be sure that you understand the true cost of that relationship and value of your time when making those decisions.

Remember, other businesses & competitors are working to make it through the same times as you are, giving them an edge or more area to maneuver isn’t going to help you in the long run.

Our Approach

• Focus on brand & remarketing campaigns to retain existing customers, and turn them into loyal customers. 
• Utilize first-party data and metrics to study consumer behavior.  
• Show off your brand’s key differentiators with creative and strategic ad assets to bring in new customers. 
  • Don’t worry as much about being polished, customers are more open to raw/unedited content now than they ever have been.
• Watch consumer & competitor behavior closely to tailor your strategies.
• Stay as consistent as possible on all marketing fronts so that brand recognition is high.
• Always look on the bright side & get extra creative!

Things To Ask Us About

• Does it make sense to shift from lower funnel to higher funnel (i.e. cheaper per click/impression) marketing campaigns?
• When and what types of promotions should we run?
• We are currently using XY tools for Z cost, do you have recommendations on alternatives? (Combining tools and consolidating costs is something we do very well!)
  • What can we automate?
• Any type of creative, business operations, or digital growth work that you’re doing but feel maybe you can outsource.

Takeaways

We have been down this road before, and the best moves have always been to stay strategic with problem-solving, get creative, and keep informed. Please reach out if you have any questions on any of this or if you are looking for additional digital growth & marketing guidance.

Sources/References:

Benady, D. (2022, March 18). Inflation forces brands to rethink their advertising spending. Raconteur. Retrieved August 11, 2022, from https://www.raconteur.net/marketing/inflation-brands-rethink-ad-spending/

How brands and agencies are spending smarter amid record inflation. The Trade Desk. (n.d.). Retrieved August 11, 2022, from https://www.thetradedesk.com/us/news/how-brands-and-agencies-are-spending-smarter-amid-inflation

Maree, P. (2022, July 7). Consumer Spending & Inflation: How to adapt your marketing strategy. Wpromote. Retrieved August 11, 2022, from https://www.wpromote.com/blog/digital-marketing/consumer-spending-inflation