A recession is described by Investopedia as a macroeconomic term that refers to a significant decline in general economic activity in a designated region. According to this explanation, Sri Lanka is currently in a severe recession with almost all economic activities hampered, predominantly by the ongoing drastic shortage of foreign exchange. The key factor in this disruption is the current fuel scarcity that impacts all activities that produce a chain reaction.
The most impulsive reaction of entrepreneurs, in particular those who are engaged in small and medium-sized business activities, is to cut down on marketing expenses. Specifically, in Sri Lanka, in such situations, entrepreneurs attempt to curtail advertising and promotions in order to set them off with other essential running expenses.
Keeping a close tab on expenditure is good practice in troubled times, but cutting down unnecessarily on marketing is not an appropriate move. As I have always emphasised in my articles, the revenue generated by selling goods or services pays bills, salaries, office rent, and all other expenses. A company cannot exist without sales. The importance is that the marketing effort of the organisation paves the way for sales, which brings revenue. Hence, it is a mistake not to do marketing during recess.
Why should you continue marketing during a recession? Most of you will be surprised to learn that marketing during recessions most often leads to growth, let alone survival. organisations that continue to carry on with continued marketing campaigns stay on the top of the mind of customers. When the recession ends and when the customer has money to spend, they unconsciously return to the seller who has stayed in their minds during the recess.
This is the reason that we keep seeing the advertisements and promotions of large organisations in Sri Lanka, even at the height of the financial downturn. For example, companies that continued marketing during the Covid-19 pandemic recovered, while many of those that stopped marketing were unable to survive.
Message
When maintaining your marketing initiatives despite a recession, you are sending a message to your audience of the strength and reliability of the organisation and your attitude towards the market. Any customer will seek out these strong characteristics from a seller in a troubled time. Your existing customers and future prospects will be drawn to whatever level of steadiness you can offer, even if you are not at your best.
On the contrary, cutting back on marketing during a recession will lessen your online and offline presence, leaving plenty of room for competitors to exploit and overtake you. The outcome in such a scenario is that anyone who disappears from the market due to a lack of communication will find it extremely hard to get back.
Your existing, loyal customer base is one of the best assets during a recess. They provide you with the best chance of sailing through the storm. Approaching existing customers is simpler, much cheaper, and more effective than going after new customers in times of duress.
Without a doubt, during a recession, more work needs to be done. However, since there is less “marketing noise” for your marketing message, you might not actually need to exert and work with less effort. What you must do is maintain audience engagement while being consistent with your branding.
For this, creating a monthly marketing plan that includes combinations of what you have been doing before the recession is crucially important. Therefore, you may use the same social media posts, emails, PR content, and conventional advertisements, perhaps with a different message to suit the situation.
How you encourage your audience is important. The marketing strategy for your business should always be current, but this is especially true when the market and economic conditions show a slump. Making sure that your brand is projecting a good message aligned with the delicate mood of your customers and prospects and staying away from any animosity is a critical step in this process. Your communication should uplift and inspire your audience to nurture a profound and lasting emotional bond.
Emotional engagement
In fact, research reveals that advertising efforts that stressed emotional involvement were more successful than those that promoted technical signals, such as special deals or discounted prices, during trying times. organisations that prioritised messages based on transactions were shown to be less profitable than companies that prioritised emotional engagement.
However, there are factors that you have to alter, amend, and adjust while marketing in a recession. You may anticipate the improvements needed when consumer incomes continue to decline. You must not only continue marketing your business during a recession, but also modify how you do it due to tightened finances, changes in priorities, and modifications in client shopping habits, without sacrificing the marketing efforts and the reach. A recession can affect two groups. Some companies really benefit from it, while others suffer. The primary distinction between these two groups is the nature of the products or services they offer. It is a universal fact that no matter their financial status, there will always be customers for businesses that sell to their needs. Therefore, it would be wise for your business to examine its offering and switch to or at least include critical services if it is currently selling goods or services that are not directly essential.
Whether your company is small or large, you have to keep advancing your online visibility. Ensure that you properly state in every one of the profiles that you are still taking new customers.
You need to constantly update your hours, promote your newest deals, and continue interacting with customers. In Sri Lanka, just as in many other countries, social media reach has tremendously improved and has become the most essential tool, overshadowing conventional advertising.
Whether you decide on the same marketing budget or lower during this period, you still have to make changes to the methods, depending on the situation and the product or service lines.
For example, people who spend more time on digital platforms during financial duress still have to make changes to the methods, depending on the situation and the product or service lines. For example, people spend more time on digital platforms during financial duress than on spending money on newspapers or new cable TV channels. Therefore, it is important to pay attention to communication channels that are performing well.
Key factors
Even in normal times, the target audience is one of the key factors in marketing. While you should always aim to reach the correct demographic with your marketing and advertising, during a recession, precise targeting is crucial for surviving. So much so, when the marketing budget is limited, because it eliminates wasting money on ineffective advertisements.
You could need to adjust your targeting so that you’re concentrating on a specific audience niche or perhaps a newly emerging one. Discover what your clients’ current needs are, then alter your targeting accordingly. To draw in the correct audience and increase the return on your marketing investments, you should also segment your online efforts depending on any new patterns and retarget your website visitors. Finally, you have to constantly monitor your campaigns to determine which of them are yielding better results in contrast to those that are underperforming.
This helps you to readjust the marketing effort if required. You may prioritise the most effective ones and discard others to save money on one hand and drive sales on the other. Also, there are plenty of examples around the world of companies that thrived during the Covid-19 pandemic, mainly due to well-concerted marketing efforts.