If you're working with an agency, it's important to ask the right questions to ensure they are prepared to help you navigate a recession (and ideally, come out on top). Understanding changing consumer mindsets, fluctuations in existing budgets, and being able to forecast and plan for the future are necessary traits in an agency partner.
Here are five essential questions to ask your marketing agency during a recession.
During and leading up to a recession, consumer behaviors and mentalities change. They become more price-sensitive, risk-averse, and value-conscious. It’s important that your marketing agency understands these changes and how they impact your positioning.
Ask your agency how they plan to track these changing values, and how often your positioning will be updated to match. This may involve refreshing your brand identity, revising your marketing messaging, and/or repositioning your product or service in the market.
Your marketing agency should also be able to help you fine-tune your marketing mix during a recession. For example, if you sell high-end products or services, your agency should advise you on how to adjust your pricing strategy to be more competitive. Or if you’re marketing to businesses, your agency should help you identify new marketing channels that reach key decision-makers who may be cutting back on travel and events.
Marketing during a recession can feel like screaming into the wind. If people aren't ready to spend money, your best efforts to attract new customers may be a challenge. You also need to consider how your existing customers are feeling. Are your efforts good enough to increase their lifetime value? After all, it's always cheaper to retain than attract.
Your marketing agency should have ideas on how to nurture these relationships and keep your brand top-of-mind. For example, your agency might suggest new upselling strategies or value-adding additions to your customer journeys. Or, hosting virtual events that everyone can attend from the comfort of their homes. Loyalty programs, discounts, and other perks can also help strengthen client relationships.
Let's face it, when times get tough budgets get cut. But that doesn't mean you have to, or should, give up marketing altogether. There are plenty of creative marketing ideas that can be done on a shoestring budget.
For example, while it may be tempting to cut back on social media marketing, this is actually a great time to be active on social. During a recession, your customers will be going out less and spending more time at home. This means more time spent on mobile devices, and more opportunities to reach them online.
Ask your marketing agency how they can help you stand out on social during this time. This might include leaning on user-generated content, re-purposing existing content, or thinking outside of the traditional marketing channels.
Optimizing your marketing spend is always a good idea, but it becomes even more important during a recession. Marketing budgets are often one of the first areas to be cut when businesses start feeling the pinch, so you need to make sure that every dollar is working as hard as possible.
Even if your budget stays the same, your marketing agency should be able to show you how they’re tracking marketing ROI and what improvements they’ve made to increase efficiency. This might include ramping up automation, improving audience targeting, and closely monitoring any drops in performance.
A recession is also a good time to review your marketing mix and make sure you’re allocating your budget in the most effective way. This might mean shifting some spend from traditional advertising to digital channels like SEO and PPC, which have a more measurable ROI.
Your marketing agency should also keep a close eye on your competitors to see how they’re reacting to the recession. If they’re withdrawing from certain marketing activities, this presents an opportunity for your business to gain market share.
Remember, the recession is temporary. So while it’s important to adjust your marketing spend now, you also need to be prepared for when the economy recovers.
Your agency should help you plan for the future, so you can hit the ground running when the recession is over. This might involve developing new marketing strategies and campaigns that are ready to go as soon as the economy improves. Keep in mind that the impact of the recession may have changed your customers’ needs and wants, so your marketing plans should reflect this. Ask your agency to monitor your industry and your competitors closely, so you can be prepared to make the most of any opportunities that arise.
While a recession can be daunting, data shows that companies who maintain or increase marketing efforts during an economic downturn outperform those who don’t. In fact, during the 2008/2009 financial crisis, companies like Amazon saw sales grow by 28%.
Don't be afraid to ask your marketing agency tough questions during a recession. How will they help you save money while still delivering results? What are their thoughts on marketing during a recession? How will they change your marketing strategy to reflect the current climate? Asking these questions now will help ensure that your company is well-equipped to navigate any economic downturns.
Remember, the client-agency relationship is a collaborative partnership so your agency should be prepared to work with you to navigate any new challenges.
Whatever you do, don't quit. As Henry Ford said, "Stopping advertising to save money is like stopping your watch to save time.”
Need a world-class agency by your side? Major Tom is here to help. We specialize in recession planning and can provide you with the resources and support you need to succeed. Contact us today to learn more!
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