Now is the time!

We're in exciting times with wars flaring up, the cost of living crisis, a shortage of labour and supply chain disruptions, to name a few minor issues. 

Now is the right time to invest in marketing! 

Usually, we see businesses invest in marketing and sales when things are going well. However, in more challenging times, you better apply counter-cyclical marketing. 

Typically, companies budget marketing dollars as a percentage of sales. When the market is strong, and sales are good, companies spend. 

However, companies often drastically cut their marketing budget when the market drops. This approach has a short-term beneficial effect, leading to longer-term losses. 

During downturns, strategic marketing is critical for generating product awareness and sustaining sales pipelines. Counter-cyclical marketing suggests that companies should increase their marketing budget to boost lead generation and improve sales conversion rates when business is down.

By investing more in marketing during market declines, companies can differentiate from competitors who do pull back, prepare for the upswing and increase market when the market inevitably returns. In the immediate, counter-cyclical marketing maximizes return on investment, as most competitors have decreased budgets. 

Top 3 things to do during economic headwind

Out of all the things you can do to stay on top during an economic headwind, these are my favourite ones. 

Emphasise core values

Stay close to the core of what you believe in. Withdraw from the fluff, we sometimes add in better times but not the essence. Nurture your core values with current clients and live them with new clients. If you have done it right, your organization is set up expressly for those situations, and you'll get the most value out of those engagements. Don't go scrambling for the wrong stuff. 

Research your customer

Customer behaviour changes as a result of a changing market. Understanding what drives your customers today is even more critical in those situations. Adapting and focusing on their needs and behaviour optimizes the effectiveness of any marketing spend.

Maintain your marketing

Instead of basing your marketing and sales on a percentage, set the budget with the long term in mind. It is easy to spend on marketing and see growth in an upturn, and it's harder to maintain growth in a downturn. Your marketing budget is only partially responsible for the increase in an upturn, even though your marketing team will tell you otherwise. 

Examples of counter-cyclical marketing strategies

When you are keen to invest counter-cyclical, there are numerous ways to do so. Which works best for your organization depends on your audience, strategy and expected outcomes. 

In a luxury market, invest in brand awareness advertising

Advertising during a downturn can gain a competitive advantage by increasing brand awareness. People are still looking for quality, and your competitor is quieter. 

In a commodity market, offer promotions

Businesses and consumers are more price-conscious, and offering promotions helps attract new customers. Be aware of the risk to your brand of ongoing promotions. It will lead to the customer expecting that promotion. 

In any market, innovate

Offer new products and services to the market. Everyone is looking for the next cutting edge, and we are all geared towards that in more challenging economic times. Consumers are looking for more value for money or new approaches. Better offer it now because if you don't, your competitor will, now more than ever. 

Whatever you decide to do, spend on it and spend now. You'll reap the benefits later.