There have been many studies over time that have proven that advertising during a recession results in better sales during the recession and more explosive growth after it’s over. In fact, most business people whom I’ve met know and understand this principle quite well. But, many continue to advertise using the same strategies they were using when the economy was robust.
A recession is an altogether different business landscape and must be approached with strategies that take this into account. We know that people tend to nest during a recession. Home and family become more important along with things that represent more traditional values.
Other traditional recessionary behavior includes changes in business relationships. Contract and finance terms tend to get renegotiated. Customers are more cautious with their purchases, as are businesses. People are more price sensitive. Customers may even trade down to less expensive models or temporarily quit buying some products.
Studies show that this behavior is caused more due to uncertainty of the future than a lack of funds. So, knowing all this, here is a short list of strategies that work best during a recession:
1. People are looking for reassurance. Implement strategies that make buyers feel they are minimizing risk. Maybe enhance your guarantee or return policy. Or just include it more prominently in your messages.
2. People are more comfortable with familiar things. Capitalize on your brand equity to reduce uncertainty. Include testimonials from past customers in your ads, or use product demonstrations. This might be a good time to remind customers of your longevity in the community. Implement a loyal customer program. Sponsor local events or activities. Ramp up your guerrilla marketing efforts and increase one-on-one visibility.
3. If your product is a discretionary purchase, you may have to work harder to identify that which motivates people to buy and how the current climate is preventing them from acting. You may be forced to stimulate sales through extra incentives such as price cuts, financing offers, extra service or added value. Many marketing experts say you should avoid discounting. The truth is that sometimes you have to include that in the mix.
4. If your product is a low priced discretionary purchase, emphasize the “reward” incentive. People will reward themselves with small indulgences because it makes them feel good and they feel like they deserve it.
5. Include cost saving ideas, ways to help your customer’s dollar go farther, or ways to get more use out of your product.
6. Many people think there are too many sales until they are in the market for something. Then they look for a sale. Have short bursts of extremely attractive sales, surrounded by a solid branding campaign that emphasizes value and service.
7. For business to business, concentrate on personal relationships, especially with current customers. Competitors will be targeting them.
8. For business to business, concentrate on messages about products and activities that will improve your customer’s bottom line.
9. Concentrate on your core. Identify what you sell most of and sell the heck out of it. Identify what you do best, and ramp up your efforts even more. Identify who your biggest, most likely customers are and target them well.
10. Implement an interactive strategy that makes connections with your best customers. Keep them engaged and demonstrate to them that you value them. There are many avenues, from blogging to e-mailing to Facebook, and yes, even Twitter. There is a combination that is best for you. Figure it out and do it.
You won’t be doing everything that is listed here. But this should provide you with enough food for thought that you can take what is appropriate and run with it.
