Maximize Your Marketing Budget in a Recession
Marketing when the economy is booming is a tough gig; marketing in a recession takes it to the next level. You don’t have to read tea leaves to know that we’re heading into some serious economic headwinds. Nobody knows for sure how deep or long-lasting a recession might be, but it would be foolish not to prepare for some sort of impact to your business.
Unfortunately, marketing budgets tend to be first on the chopping block. While we would argue against cutting marketing spend, even during a downturn, you’ll still probably need to make adjustments and be judicious with your budget. Here are six ways to make the most of your marketing budget during a recession.
Invest in retention.
Acquiring new customers is 5 to 25 times more expensive than keeping the ones you have. Retention goes from important to imperative during a recession when the flow of new customers slows to a trickle.
- Get creative and show your customers some love—let them know you’re here for them and that you appreciate their business and loyalty.
- Make sure the customer experience is flawless so they don’t have reason to look elsewhere.
- Audit your pricing structure to make sure it’s competitive. Cost is the number one reason people shop around during a recession.
- Reach out and solicit feedback (and then act on it). Don’t just tell your customers you’re listening, show them.
Dedicating some of your budget to reinforce the relationships you already have will pay dividends.
Become more efficient.
You’re probably going to need to do more with existing or fewer resources until the economy turns around. Take advantage of automation wherever possible to save yourself time. Get creative with repurposing content rather than starting from scratch. Don’t waste time meeting about something that can be handled via email, Google Docs, or Slack. The amount of time spent in meetings has more than tripled since February 2020. If you can find ways to get even a third of that time back, it will do wonders for your productivity.
Segment your data.
Don’t waste your time or money on prospects who won’t convert. Lead scoring, grading, and segmenting your data will help you narrow your focus so you can target the right audience. Segmenting your data also allows you to provide more personalized experiences. Given that 72% of consumers have said they’ll only engage with personalized messaging, using your data to create targeted, tailored communications is key. When it comes to more expensive channels like direct mail, scoring and grading your data helps you allocate the right budget for your highest qualified prospects.
Look for the opportunities.
All change, even the recession variety, can produce opportunities if you’re paying attention. We’ve seen our biggest innovation leaps as a company during recessions because we listened to our customers’ challenges and got scrappy and creative in solving them.
Marketing in a recession doesn’t mean you have to stop innovating. Are there particular pain points you can address for your customers? What emerging needs and gaps in the market have you observed? If all of your competitors pull back on direct mail to cut costs, you suddenly have an opening to capture your prospects’ attention with less distraction.
Keep in mind that innovation doesn’t have to be customer-facing. There are likely plenty of opportunities to reassess your internal processes as well and find new, better ways forward.
Be flexible and ready to adapt.
Those opportunities we just told you to look out for? You’ll need to be flexible enough to pounce on them. That may mean shifting your priorities to accommodate something new and moving quickly enough to capitalize on it. When planning your marketing strategy for the coming year, be sure to leave yourself some wiggle room for new, currently unknown initiatives.
On the flip side, you also need to be willing to abandon what’s not working, even if it means changing direction. As much as we all love a good plan, we need to be prepared for that plan to get yanked out from under us at any given moment. It’s easier to pivot and adapt when you’ve already thought through some alternatives.
Narrow your focus.
Put all of your current marketing efforts under the microscope. If you aren’t seeing that a particular channel, tactic, or strategy is driving revenue, it’s time to hit pause. This isn’t about cutting overall costs; it’s about optimizing your resources. Redeploy your budget in ways that are proven to be efficient and effective.
While testing new ideas is crucial to growth (and you should still set aside budget for continuous testing), you need to balance that risk with tried-and-true campaigns that will shore up the bottom line. Narrow in on a smaller number of proven strategies and then A/B test within those to optimize your results.
The one thing we know about recessions is that nothing is for certain. The current predictions may fizzle out, or we may be heading into a very tough year. Either way, best to prepare for the worst and hope for the best. And when you’re ready to get the most ROI from your marketing budget, we’re here to help.