It may seem strange to you, but the companies that have best-overcome crises have invested in this area and not those that have reduced their marketing budget.
Why Invest in Marketing During a Crisis?
During a crisis, most companies try to cut expenses, especially when it comes to marketing items.
It’s no secret that the COVID-19 pandemic has had a reasonably debilitating impact on the economy, shaking the market like never before. With shoppers less inclined to spend, companies saw no other solution than to cut spending.
Viewing marketing as one of the first areas to sacrifice is wrong, as well as counterproductive.
Marketing is never a waste of money, quite the opposite. Especially in a time of economic crisis, everything related to marketing is vital to the success of a business.
Whether you decide to hire a digital agency that is in charge of planning and implementing a strategy or if you choose to train one or more of your employees through the many Masters in Digital Marketing that exist, keeping your digital marketing campaign active is a safe bet that will bring benefits to your company.
Five reasons why companies should invest in Digital Marketing during the crisis
Now let’s take a closer look at why it is not advisable to cut back on marketing investments during a recession.
1. Cutting back on marketing will only save you money in the short term
When your bottom line begins to decline, it may seem natural to cut back on spending in certain areas. Marketing is often cut back because its benefits are often seen in the long term rather than the short term.
A sudden reduction in digital marketing spending may pay off initially but will significantly impact your business over time.
Marketing is the lifeline that supports your audience. Without it, you are destined to lose it, in part or whole. Instead of cutting your budget, revaluate your strategy.
A recession allows you to reallocate spending. It is the moment to understand your clients, know how they live the situation, and absorb the information and the news.
You can then decide the best type of communication to use with them.
It may seem like a relief to cut back on marketing spending in tough times, but the benefits are only temporary.
Find a strategy that will ensure long-term success.
2. Data collection is crucial during a recession
On average, there has been a recession every four years since 1900. Unfortunately, economic crises are inevitable. Therefore, strategies to combat them must be planned in time.
Experience has always been the best teacher.
For this reason, it is essential to maintain the same marketing budget even during periods of crisis to have the possibility to study effective strategies in this field.
Investing in well-executed digital marketing campaigns can be tracked with measurable results, and companies can use this data if similar conditions arise in the future.
If you are a business owner, you must monitor and document your workflow, the changes made, and the results obtained. Whether you are monitoring SEO (search engine optimization), paid advertising, social media, or any other form of advertising, be sure to watch each aspect’s success closely.
When the next crisis comes, you will know what to do. You will have strategies and processes to refer to. It is true that each economic crisis has its characteristics and requires diversified actions. Despite this, having a “canvas” to follow is extremely useful.
Why? Simple, it will help you better understand your target’s behaviour.
3. Less competition means more shine
If your competitors get carried away, you have the opportunity to stand out and differentiate yourself from them. Businesses worldwide are spending less money on digital marketing, so seize the moment.
Here are some of the things to watch out for:
- SEO (search engine optimization): Many websites use outdated keywords and ignore SEO strategies. That is why you must redouble your efforts.
- You can climb the search results and rank high in the SERP (search engine results page). If others don’t make an effort, you do. Recessions are a great time to test your skills and abilities. You have to steel yourself and “throw your heart over the obstacle.”
- Paid Ads (SEM): During a recession, some types of searches can drop significantly. This may be because those who run certain services have cut marketing expenses. With fewer paid and banner ads, your PPC (pay per click) ads can get more visibility and more clicks.
- Social media: Many companies view social media advertising as an accessory to their marketing campaigns or as a nice add-on that may not be necessary. It is clear that if you think about it like that, the first thing you will cut back is marketing. This enables the boldest and most resilient marketers to make their businesses shine.
4. Effective marketing denotes strength and good health
In times of uncertainty such as today, the situation of many companies is questionable. The economy is reeling; businesses and companies fear the worst.
You have to let your clients know that you can stay afloat in tough times.
A powerful marketing campaign shows that your business is in good health and is still available to your customers. Users buy from brands that work and can give guarantees. If you reduce marketing, you give the idea that your company is reeling and cannot withstand the shock wave of the crisis. In this case, the possibility that your audience will abandon you for someone more trustworthy is not far off.
Understandably, companies struggling to pay employees and cover overheads have to cut back somewhere. Sometimes cutting back on marketing may be necessary, it is true. But it is also true that there are many ways to let the world know that you are still active and happy to provide your services. If your marketing budget is low, make sure your audience has a social media presence.
Even if your social media marketing isn’t the most effective, it can still work wonders and is still better than nothing. Enter powerful keywords to improve your search engine rankings. You can do many things to advertise your business while keeping costs low. Don’t sacrifice it, and try to stay active, present, and empathetic with your audience.
Keep listening to them even if your means are limited. This way, you can keep moving head-on into the storm and come out alive.
5. Not cutting your marketing budget will better help you understand your audience
Your audience can drastically change their attitude during a crisis, but not always in the way you expect.
Most companies focus on making services and products more affordable, while others offer luxury products and services to those who can still afford them. It is essential to understand your audience, assess what you can and cannot afford. In this way, you can be targeted and effective marketing, using the right tone and strategy.
For example, if you offer a luxury service, you might consider lowering your prices. But are you sure this is always an optimal strategy? Before doing so, you need to analyze your audience carefully.
If they are not affected by the recession and continue to spend as before, they may interpret their movement as a harbinger of lower quality services. They may think that you are in the doldrums and cannot maintain quality service.
Consequently, they will look for other luxury services according to their expenses and expectations.
On the other hand, if your audience becomes fewer spenders, all you can do is adapt. Offer discounts and focus everything on comfort. Clients will be relieved not to have to sacrifice essential services like dental treatments during this time. They will feel heard and understood, which will carry you through the crisis together. Your understanding of their needs will pay off for their loyalty to you.
During economic downturns, brands often try to cut back lightly to ensure financial security.
However, we have shown how marketing and advertising should not be included in these cuts in this context. When done right, they can be the key to surviving a crisis, growing your business, increasing your market share, and strengthening your brand reputation.
It is precisely when many people give up that you have to step on the accelerator. Not all companies will cut back on marketing, but many will create silences that others will fill and exploit opportunities.
The IAB’s study of digital advertising investment concludes that in 2020, investment in advertising in digital media will continue to remain above 3,000 million euros (3,029.5 M €). However, it fell by -3.8% compared to 2019. Despite the particularity of the context of 2020, caused by the health crisis of Covid-19, the digital advertising sector continues to enjoy good health, experiencing smaller decreases than traditional non-digital advertising formats.
Even if they don’t have new products ready to hit the market at the right time, innovative companies continue to invest during recessions, and you should too.
Working behind the scenes during times of recession will guarantee your brand the longevity it deserves.