Without warning and without choice, brands and retailers have had to adapt to a pandemic that no one saw coming. Even though restrictions on lockdown are slowly easing, the long-term effects are yet to be seen.
According to new figures from McKinsey published in Marketing Week, UK consumers are becoming more pessimistic about the likelihood of a quick economy recovery from the coronavirus pandemic.
The UK economy is now the biggest concern among UK adults, cited by 62%, followed by not knowing how long the situation will last (56%) and health of vulnerable relatives (53%).
So, as marketers, what do we need to think about to fulfil our role in this economy? Well, we are all in slightly different circumstances; for some slow-down of their key competitors has presented opportunity for growth in marketshare or share of voice, for others they are just returning to the fray after a period of ‘freeze’ where their business has been inactive. But for everyone, focus has intensified, budgets are under review and the day-to-day is not the same as it was at the outset of the year.
Take a moment to take a breath before diving in. Start by taking stock and taking the opportunity to look at your marketing plans with a fresh pair of eyes. If your situation is anything like mine, the plan that you were looking to implement in 2020 has been turned on its head.
Now is a time to be tactical to test and focus on data and revise your plans for the future. The world is still in a state of flux. Many things that you took for granted about your customers/prospects behaviour may no longer be relevant. People’s routines and working patterns have changed and the challenges that drove their priorities a few months ago have been subjected to reprioritisation.
You need to know more than ever how customers and prospects are redefining value and responding to the current situation and the looming threat of recession.
For example in the B2C world: Top priorities for shoppers. According to a survey by Bazaarvoice, before the pandemic, respondents’ main priorities when purchasing were quality (48%), price (47%) and brand (24%). Now, they’re mostly focused on availability (49%), price (36%) and quality (34%). It’s very interesting to see the change in priority for shoppers, with the focus moving to availability. This will prove a key time for consumers to try new brands that they perhaps wouldn’t have before. This may result in a change in brand loyalty for some consumers who discover new products as part of their new shopping experiences.
The first step in responding must be to understand the new customer segments that emerge in a recession. This breakdown from the Harvard Business review is as pertinent today as it was when it was published in 2009.
“Marketers typically segment according to demographics (“over 40,” say, or “new parent” or “middle income”) or lifestyle (“traditionalist” or “going green”). In a recession such segmentations may be less relevant than a psychological segmentation that takes into consideration consumers’ emotional reactions to the economic environment.”
Focus on your customers and what their current behaviours are telling you. This is just as true for B2B as B2C businesses.
We have previously talked about building share and the importance of valuable content during a downturn. And how the use of this content to illustrate your authority, promote your credibility, increase engagement, improve SEO and grow your database can have positive long-term effects – Read more here >> . But this cannot be done in a vacuum and, although competitor analysis and bench-marking is a mainstay of BAU, the focus on their current activity across the 4 or 7 Ps (however many are relevant to your business) needs renewed focus. However, be mindful of the words of Jeff Bezos
“If we can keep our competitors focused on us while we stay focused on the customer, ultimately we'll turn out all right.”
Your research into
the activities of your competitor and indeed the reactions and activities in
the wider market serve as context for you.
Don’t get too hung up on what everyone else is doing, and certainly don’t
get dragged into a price war.
As Mark Ritson notes, you have to start with your brand and how the customer perceives it alongside other businesses. So by using the insights you have obtained with your competitor analysis, you have the context you need to effectively evaluate your brand strengths.
You need to reinforce your brand values and show how your brand purpose is relevant in time of recession.
Don’t just tie yourself in a tactical knot, you have to look both at the present and the future. Although this likely falls outside your usual cycle of marketing planning, you have the opportunity to pare your strategy back to basics and rebuild from the ground up.
1. Who are we going after (who are we not going after)
2. Brand position and values
3. Strategic objectives
Sensationalist claims that the world is going to change overnight as a result of the pandemic have already begun to appear in the media, but don’t let this distract you. Remember the fundamentals of your brand and what it offers and the requirements that it fulfils in the market. So, following my theme of quoting Jeff Bezos;
“I very frequently get the question: 'What's going to change in the next 10 years?' And that is a very interesting question; it's a very common one. I almost never get the question: 'What's not going to change in the next 10 years?' And I submit to you that that second question is actually the more important of the two -- because you can build a business strategy around the things that are stable in time. ... When you have something that you know is true, even over the long term, you can afford to put a lot of energy into it.”
Whilst in some respects the pandemic may have accelerated change, forced people to re-evaluate behaviour, buy more online, switch brands due to lack of availability and reprioritise their spending; their quest for value remains.
I recently heard a description that I liked of the V for value as one side pointing into your business and the other out into the market – and they converge in a win/win.
Re-evaluate your value in the current climate and how it will develop moving forward.
And now for some Marcoms practicalities
Mark Ritson, in his article in Marketing Week Marketing in the time of Covid-19, advises that:
"If you’ve just lost half of [your marketing budget], the temptation is to dump it all into shorter-term performance marketing and sales promotions.
That would be an error. No amount of hot deals and clever sales activation can stimulate a market that is currently terrified, locked inside their homes and unsure of their future.
Confronted with a 50% cut in marketing budgets, the smarter play is to actually focus more of it on the longer-term brand-building mission. Performance marketing is going to under perform in the current market conditions".
Whilst tactical, sales led activity is necessary, it should not be allowed to dominate. Ensure there is a balance and that you continue to build your brand equity and improve your customer experience as this will pay dividends in the medium and longer-term.
If you have gaps in your communications activities, then now is the time to build and fill them. Indeed if you do have them, now is the time to improve them. This doesn’t have to be an ominous task either, very often it is easy to repurpose content that you already have and no more is required than a simple tweak to make it appropriate for a different stage in the buying journey.
Review your automated marketing activities, both email and retargeting in light of your brand review and ensure that the key messages are portrayed clearly. Make sure that the value you are offering is obvious.
Here are some more suggestions:
1. Revamp welcome series
Think about how you can extend your programme - the first few emails you send to new subscribers will always be the most responsive so, if you don't do these already, these could be some of the highest impact 'quick-wins' on this list.
2. Supercharge your newsletter
If your newsletter is delivering the same message to everyone, look to boost response by tailoring it better to your audience depending on different targeting criteria, or dynamic content to increase engagement.
3. Update/Create abandon cart triggered email series
(Or form abandonment if you are in B2B) Similar to welcome serimarketes, abandon cart retargeting campaigns have a higher engagement rate and are going to leads that are already warm. According to Shopify Abandoned cart emails are sent to customers who have added products to their cart but failed to check out. It's remarkably effective as a sales recovery tactic. According to SaleCycle, nearly half of all abandoned cart emails are opened and over a third of clicks lead to purchases back on site. For more interesting stats, have a look at econsultancy.
4. Recharge your win back
There are a number of content themes that you can use in your win back campaigns, indeed you could make them multistep campaigns and utilise several of these possibilities ie
5. Look at loyalty programmes and customer comms
Innovation is good, but it's worth remembering to be sensitive at the time of the recession. Although dark humour may get you awareness, you’re also trying to develop brand favourability, so keep campaign themes sensitive.
By all means use humour – but use it wisely.
There are also lots of helpful tips for creating a marketing action plan on Smart Insights.
Finally, now is the perfect time to review your martech stack. Using multiple cloud-based marketing tools can be expensive - some estimates put it at 15 to 25% of a marketing budget. There are potential savings here, either by consolidation to a single marketing cloud solution or stopping using tools you don’t use much. Better value is available out there.
Appraising your branding and communications is key in times of a recession, but it is important to review all aspects of marketing not just the promotional element. I have focussed on this as for the majority of marketing departments this is the area that is under their complete control, but I would also recommend reviewing the 8 recommendations for marketing in a recession from Harvard Business Review for more general advice and spearheading reviews throughout the business.
[Webinar] If you have any questions about email marketing, automation or emailing during a recession we are running another Ask the email marketing experts live Q&A on 9th July. Book you place now.
We are confident that we can help you, which is why we offer a free healthcheck to identify potential issues with your current programme and free advice on things that could be done to improve it.