Marketing During a Recession

It is a well known fact that the global economy has moved into the recession era and slowly people are cutting down on their expenses. The biggest impact of this recession has been on businesses which is reflected in budget decreases in every department.

In regards to marketing, businesses can still market with the same effectiveness even on a reduced budget, provided they follow these fundamental strategies. It will depend on the businesses as to how effectively they can implement these strategies in order to gain the same exposure and reach during a recession.

Taking care of your Customers
Customers are the lifeline of businesses. Now more than ever businesses must enhance the way they provide service to their customers be it pre-sales or after the sale. This is just one critical factor, which may help separate your business from the rest. Therefore, catering to your customers and fulfilling their demands and taking care of them during the recession is itself a better way of marketing and building your goodwill.

During hard times, it is important we make it easier for the customers to purchase our product or use our service by offering special incentives or discounts. This can greatly help customers choose where to buy. If a customer is undecided about where to buy, it might just be the discount you offer them that could make the deal. Discounts or incentives have always been one of the best ways to entice a sale. Also you should be innovative in determining the discount codes. For example, use ‘credit crunch’ or ‘recession’ discount code on your promotion. This helps assure clients that you are aware of their financial woes and are doing what you can to help them in these times of uncertainty.

Your Product Price
During a recession customers take more time searching for durable goods and negotiate harder at the point of sale. They are more willing to postpone purchases, trade down, or buy less. Thus, it’s better to reduce your profit margin per item and try to increase the bottom line by increasing your sales. Giving discounts, attractive gifts and free or reduced shipping are truly viable options.

Furthermore, it is important that you show why choosing your product or service will be a cost effective solution. Provide a comparison chart showing why customers should buy from you and not from your competitors. Clearly state (or show) the reason for your recommendation. During the recession it is always in the best interest to differentiate your business based on pricing as this factor closely resonates with your customers needs.

Basic Needs and Quality Goods
It is important to focus on those items which are of daily use and are considered basic needs for people. In periods of a recession, customers are not concerned about the luxurious goods and commodities. If you have some products that you can position as an everday item, then tailor your marketing message and promote it as an everyday item.

Quality is another important factor. Durable goods are in high demand during recessions. Thus, it is important to make the customers feel that they are purchasing something of quality that will last longer. It is important you portray the message that this product is of better value for the money as it will last longer than other products on the market. Again, as mentioned before, price factor is something that closely resonates with customers during recessions, so even if you are differentiating on quality, it is imperative that you bring out the price factor. For example, you can mention that your company’s product may cost a little bit more but it will give you twice the service life as compared to your competitors, thus providing your customers more value for their dollars.

Advertising and Marketing
Research shows that brands that increase advertising during a recession can improve market share and return on investment at a lower cost than during thriving economic times. Generally, during recessions uncertain consumers need the reassurance of known brands. More consumers stay at home watching television or browsing the internet looking for the best deals. Therefore, it would be a good time to boost advertising in these mediums. Those brands with deep pockets may be able to negotiate favorable advertising rates and lock them in for several years.

However, if you have to cut marketing spending, then try to maintain the frequency of advertisements by shifting from 30-to-15 second advertisements, substituting radio for television advertising, or increasing the use of direct marketing, which gives more immediate sales impact. We recommend not decreasing advertising during this crucial time as it may have a broader impact on your sales than you think.

Sign up for eMail Marketing for FREE for 60 days, then as low as $15/month thereafter!