While uncertainty is reigning during the current global pandemic, economic indicators are pointing to a recession, and we are already there.
The pace and extent of a recession vary depending upon which media house and which pundits you choose to listen to, but for marketers, there are certainties to which we can all grip.
Companies must put a laser focus on existing customers, clients and partners. Now is not the time Ghanaian companies are to ignore the business they have. The companies must place more emphasis on inside sales to their current customers.
There are a myriad of studies that show the higher cost of acquiring a new customer relative to nurturing a current relationship. Companies must remember that those “clients” are people, and they are struggling with the same business challenges and decisions that they are facing.
Companies are to speak with the customers. They are to reach out and see how the customers are doing. They must find out what is keeping them awake at night. A crisis is not a time for selling products and services. A crisis is a time to be a partner and a friend to customers. Those relationships will strengthen as a result and will likely bear fruit when the market returns.
For example, in uncertain economic times, Companies are advised to send a note to longtime client that simply asked how they were doing, and I meant it. Simple, short and genuine. Customers will definitely respond and be very happy about that. Companies are likely to get responses like,” your message was nice to read: simple yet compassionate… a refreshing alternative to many of the lengthy updates we are getting from companies on their various states of preparedness for business continuity.”
Companies must remind their management that a recession does not mean a retreat from marketing.Henry Ford once said, “A man who stops advertising to save money is like a man who stops a clock to save time.” When recessions hit, marketing is often among the first budget cuts. Doing so could potentially cause long-term damage to the brand and allow smaller or weaker competitors to steal market share.
There are ton of studies going back more than a decade showing that brands maintaining or increasing advertising during a recession gain market share over time.
Companies that reduce costs by focusing on operational efficiency while investing in growth strategies, such as marketing and R&D, are best poised to beat a recession.
Companies should be adroit and open-minded to new technologies, tools and platforms.
Preserving marketing budgets does not mean the current situation. Marketers need to look within themselves and their customer segments to determine which emerging marketing channels should be tested and embraced.
In 1929, Procter & Gamble came out of the Great Depression in USA as a much stronger brand than it was when the stock market crashed. Instead of cutting back its advertising in cost-cutting efforts, the company shifted its marketing dollars into new marketing channels, including radio. In a 10-year span, P&G sponsored a handful of soap operas. This was the original content marketing plan execution.
During recessions, new channels emerged. Companies should think about the advent of social media and take advantage of it. Companies should take the opportunity to use these platforms to reach audiences quickly and in targeted ways.
Companies should use the time to focus on strategy, build content and analyze their customers’ behaviors.
They should acknowledge that customer behavior is going to change as a result of the changing environment. Companies must use data to anticipate what they believe their customers will be looking to do, and use marketing to be there waiting.
One of the most successful businesses during the 2008 recession came as a result of a wholesale business model change. Long before Netflix began producing award-winning movies like The Irishman, Netflix ran a profitable video-rental-by-mail business. When home Wi-Fi and a high recessionary unemployment rate created demand, the company shifted its model to provide video-on-demand through Comcast or Apple. Netflix gained members during the peak of the recession in 2009.
While the change was assisted by advancements in technology, at the heart of the change was a careful analysis of customer behavior. This sort of careful re-examination of customer behavior is critical to controlling the company direction in the recovery.
Companies should provide certainty when customers are overwhelmed with uncertainty.
Psychologically, brand consistency during uncertain times can gain brand loyalty. By being one of the constants in a world that is variable, your audience will begin to associate brand attributes like stability, consistency, commitment and longevity to your brand. Believe me, half of the top 20 most trusted brands are nearly a century old.
In marketing as in life, certainty is a scarcity in this world. As marketers and people, if we can provide just a bit of level-headed thinking and stability, we will find that we will have a community following and cheering us on when the skies clear. And clear they will.
Author: Dr Alfred Owusu Dean Business School Kumasi Technical University.