When times are tough, businesses frequently seek out ways to cut back on unnecessary expenses and regrettably, marketing is frequently the first area to suffer. For instance, advertising expenditures plummeted by 13% during the recession of 2008. But doing this in a slowdown is a big mistake. Reduced marketing activities mean reduced visibility for both new and existing clients. At a time when you should be advertising the exact opposite, it could even give the impression that your business is closed.
The Importance of ORM During a Recession
There are several reasons to invest in ORM during a slump.
Nurturing Your Clients
Customers’ purchasing power changes during a recession. So, despite the fact that your customers want to remain faithful, their priorities shift. That does not imply that businesses stop marketing to them. The best strategy necessitates a thorough examination of the needs of the target market, followed by fine-tuning and adapting strategies, tactics, and services in response to their shifting needs.
Attract More Interest
Most businesses reduce their marketing expenses during a recession. They thus lose their identity and brand value. Your brand won’t become simply another economic footnote if you continue to spend on marketing.
Project Stability and Credibility
Businesses that maintain consistency in their output and quality are four times more visible than those that don’t. This is especially important during a recession since it indicates that your brand is in peril. This could make your customers lose faith in you. Your customers wouldn’t have to worry about the health of your company if you kept up a good marketing campaign.
Seek Out New Opportunities
A challenging period is ideal for putting your capacity to create and develop inventive solutions to the test. A recession may not be a time of stagnation after all, but rather a chance to explore different markets, alternative marketing strategies, and revenue streams.
For example, when the worldwide pandemic hit, the events sector swiftly switched to a virtual form. When social isolation was the new norm, they developed and adapted to make products that enabled people to connect and meet online. And these new developments aren’t going anywhere.
Why Investment More in ORM During a Recession?
It may seem paradoxical to invest more money in ORM if your company is struggling. But it is the ideal opportunity to get an edge over your rivals.
The likelihood that your competitors are reducing their marketing expenditures implies there will be less chaos for you to contend with. Your company will be better prepared to grow when the market stabilises and the economy experiences growth. Furthermore, you will most likely enhance your market share rather than simply regaining it.
Gather & Examine Data
Marketing is driven by data. However, what worked yesterday would not necessarily do so in a period of economic distress. So how do you go across unexplored territory? Use the information at your disposal.
Analysing the information you’ve gathered from current and former customers is the best way to get more out of your marketing budget. Assess the effect that previous tactics could have. Even if your tried-and-true strategies might not be as successful right now, it’s sensible to see whether they’ll still work for you. Spend some time learning the platforms and approaches your customers like to use. Insights and trends that will serve as the basis for the next campaigns should be sought out.
It’s time to put the spyglass back in its case and scrutinise your competition if the outcomes of your previous efforts haven’t left you feeling satisfied. Look at what your rivals have done that has benefited or damaged them. Once you’ve identified what gives them the upper hand, create similar content or campaigns in your own style.
A Turning Point in Psychological Segmentation
Traditional customer segmentation, such as those based on lifestyle or demographics will not be effective during a recession. Focus on the psychological segmenting of your customers rather than demographics. This is because:
Psychological segmentation, often referred to as psychographics, focuses on the distinctive personal variables that influence customers’ choices and decisions, such as personalities, behaviours, beliefs, hobbies, socioeconomic status, and lifestyle. You may develop the ideal tone and message for your product by categorizing your customers.
Your resiliency is put to the test during a recession. Your devoted customers are only waiting for the right moment to resume their loyalty to the brand and start buying your products. Instead of reacting instinctively to a decreased revenue or customer base, you should devise a unique marketing strategy that plays to your advantage over a longer time frame.
By continuing to spend in ORM even during a downturn, you will make sure that you will get the largest possible piece of the market.