With over 90% of UK consumers concerned with the current cost of living crisis, its fair to say the majority of your target market are likely to be affected. So how to communicate during tough economic times? Read on to find out and check out our most recent podcast discussing this issue here.
First things first, whilst a common knee jerk reaction for businesses is to pull everything, don’t. We now have the benefit of recent historical data from both the 2008 recession and during the Covid shutdowns and it shows that the brands that weathered those storms were those that held their nerve and continued to invest in marketing.
If you maintain your spend, you may not see the advantage now – during the recessionary period – but your growth will be far superior to your competitors who did choose to cut back. The reason is that it enables you to gain market share in the long term as your competitors lose theirs.
To make savings without damaging your brand, cut your short term activations, for example events or Google Ads, and keep the long term brand building activity instead. It would also be prudent to go through all your operational costs and make cuts where you can.
When it comes to external positioning, are there strategic changes you can make that ensure your brand is fit for the world we’re living in? For example, with consumers being more risk averse and sensitive to pricing, Ryan Reynold’s Mint Mobile made a permanent reduction to its tariffs to attract a new target customer and to show that it understood times were difficult.
Similarly, show your customers how they can save money by shopping with you. Is there a discount loyalty scheme, cash back rewards, payment in instalments or cheaper versions you can offer to make it easy for consumers to stay loyal to you?
Another factor to consider is supporting your staff during this time. Ensuring people are being paid fairly and intensifying your efforts to promote diversity and inclusion by offering flexible working practices are all impactful ways to benefit your team, as times of economic difficulty are more likely to negatively impact women and diverse communities the most.
Consumers and businesses are looking to save in all areas of their lives, which will create a challenging environment for many brands. If you can hold your nerve then you will be in the best possible position to take advantage when the tides turn again.