Like all of you, at Digital Storm, we have been following the current situation in detail and when deciding what the next move is, the best thing to do is to look at the facts. Therefore, we have compiled a number of key facts and statistics to help inform your marketing decisions over the forthcoming months.
The new normal
Even when lockdown lifts, the economy isn’t going to bounce straight back to how it was, the virus will still be spreading and consumer and business decisions will be heavily informed from a safety and health perspective. It is also highly likely the Government will take a staggered approach in opening things up again prioritising certain industries and maintaining social distancing enforcement.
A survey published by Scorpion revealed several changes in consumer behaviour that reflect an adaptation to a new way of living. In order to adapt to the “new normal”:
- 24% of people plan to delay large purchases
- 42% are planning to cook at home to save money over the next six months
- 49% plan to delay travel
- 44% plan to delay medical or dental procedures
- 24% plan to delay home improvements or repairs
Almost half of all respondents indicated that they will be trying to save more during the next six months. Even less financially resilient segments of the general population plan on building a more robust fund to address economic challenges in the future.
Should I stop or slow advertising and marketing efforts?
Historically when a recession happens, businesses, fearful of declining revenue, begin to cut back and often their advertising spend is one of the first items on the chopping board. Despite this, there have been numerous studies that point out the advantages of maintaining or even increasing Ad budgets during a weaker economy.
“I have yet to see any study that proves timidity is the route to success. Studies consistently have proven that companies that have the intelligence and guts to maintain or increase their overall marketing and advertising efforts in times of business downturns will get the edge on their timid competitors.” Senior VP, J. Welsey Rosberg Meldrum & Fewsmith.
Looking at historic case studies, we know that those advertisers that maintained or grew their Ad spending increased sales and market share during the recession and afterwards.
- Amazon sales grew by 28% in 2009 during the “great recession”
- Since Toyota was experiencing strong sales, when The 17-month recession of 1973-75 hit, they resisted the temptation to drop their Ad budget and instead adhered to their long-term strategy. Toyota, therefore, surpassed Volkswagen as the top imported car maker in the U.S. by 1976
Seize the opportunity
The core reasons why you should actually consider increasing marketing during a slowdown are as follows, as cited by Forbes – When A Recession Comes, Don’t Stop Advertising:
- The “noise level” in a brand’s product category can drop when competitors cut back on their Ad spend. In English, the advertising landscape becomes less competitive
- Brands can project to consumers the image of stability during challenging times
- The cost of advertising drops during recessions. The lower rates create a “buyer’s market” for brands. With fewer people buying advertising space the cost reduces and haggling often yields greater results
- When marketers cut back on their efforts, the brand loses its “share of mind” with consumers, with the potential of losing current – and possibly future – sales
What does this mean in 2020 though?
With so many people now working from home, people are spending vast amounts of time online. The majority of respondents (55.5%) spend between 3-6 hours online, while another 29% are connected for as much as 7+ hours.
Here is a break down how time is being spent online, from Scorpios report published on April 18, 2020.
- Streaming services: 42.0% user increase, driven by 18-44 year olds
- Social media usage: 33.8% user increase, driven by 18-44 year olds
- Online shopping: 30.7% user increase, driven by 25-34 year old homeowners
- Mobile gaming: 21.1% user increase, driven by 18-24 year old male renters
- Console gaming: 18.3% user increase, driven by 18-24 year old male homeowners
- Virtual workouts: 14.4% user increase, driven by 35-44 year old homeowners
This means that there has arguably never been a better time to focus on starting or ramping up your content marketing efforts. Getting content out on social media from podcasts and/or video content to images, text or articles… now is prime time to focus on building an audience for your brand while there is such an increase in online attention.
With 45% closely seeing ads and 68% finding it helpful when ads show regard of the current scenario bolstering that content with social advertising through platforms like Facebook, Instagram, LinkedIn and YouTube is another great opportunity for businesses of any size.
What content should I be posting?
For many people, this question has nothing really to do with the current situation. While certain shifts and sensitivities must be considered, your brand’s tone of voice and content shouldn’t change to a point where it starts to lose your core and existing audience (unless of course, that is intentional).
Without teaching anyone to suck eggs, as much as possible, you should try to provide value with your content and relate to your target audience.
Entertainment is a good route to consider. During the 1918 pandemic, the industries that thrived were theatres, printing presses and brothels. We see a similar pattern today with the increase in media attention and increased uptake of streaming services and social platforms. Therefore, it is worth considering how to leverage our need to be entertained to your advantage.
Based on a recently published article, from the B2B Institute, identifies that adverts focused on price and promotion along with those that were aggressive, competitive or overly focused on ‘things’ are all connecting less with people during this coronavirus lockdown. However, ads that focus on human connection, ads set in the past and ads that maintain the use of recognisable brand mascots and characters are all performing better at current.
For people starting to focus on their content strategy for the first time who are at a loss for what they should be putting out, we would be happy to have a conversation and see if we can assist.
Summary and Conclusion
Recessions and economic-slow downs present a good opportunity based on the historical evidence for those who maintain or increase their marketing efforts.
Online attention has never been higher so focusing on improving your website and increasing activity on your online content channels would be a sensible starting point for any business.
With reduced competition advertising costs have decreased and there are some great bargains to be haggled with advertisers.
Get ahead of your competitors who are cutting their marketing budgets by using this is the time for you to double down on yours. In the words of Warren Buffett… “be greedy when other people are fearful”.
If you want to discuss anything about your marketing, brand or website needs then our Digital Storm team are all available. We are happy to provide you with an initial consultation FOC over Zoom to understand your business along with your needs and concerns.