There are few companies in existence that have not felt the affects of the current recession impacting on their business and profit margins. As many of us know, uneasiness in the market fostered by fears of job losses and reduction in wages has consumer spending at an all time low.
Many business leaders feeling the pressure on their profit margins often react by applying cuts to their budgets, with marketing spend often first on the chopping block.
However, as history has shown us, savvy business leaders can recognize that cuts to budget spend alone are not the answer and that changes in the market demand adaptation to current marketing practices.
Recessions create huge challenges to businesses but why try and weather the storm when the opportunity exists to capitalize on your brand equity to strengthen your market position, and even develop profitable growth.
7 Steps to Brand your Way out of Recession
1. Adapt Your Brand to Customer Needs and Wants
How have consumers lives been changed by the recession? How have their needs changed? Your brand needs to be managed in a way that adjusts its marketing strategy to meet these changing consumer patterns. Revamp your brand packaging to be more relevant or user friendly, develop and up-sell new service products; analyze the new needs of the market and adjust your brand accordingly.
2. Brand Your Way to Market Growth
“You can’t save your way out of a recession – you have to invest your way out. You can’t just invest in the good times and then forget about them in the bad times and hope to get any results” Craig Barrett. Chairperson Intel
A reduction in branding investment will have a knock on effect on the entire business. Reduced visibility or weakened brand equity leads to a reduction in demand leading to negative effects on profitability.
History has shown us that brands that increased or even maintained their investment in the brand during a recession actually saw an increase in marketing share. If your competitors are making cuts to their marketing budget than by maintaining your spend you are gaining an instant competitive edge.
3. Review and Remove
Review and analyze your current brand activity. Cuts to marketing budgets without focused brand strategy have detrimental effects on the overall profitably of a company.
However, removing any lower value marketing costs can actually improve efficiency and effectiveness of your brand strategy. Being more selective in where and how you market your brand can actually bolster profitability. Track the ROI of brand investment and re-allocated funds to marketing activities to monitor what results in increased revenue for your business.
4. Maintain Consumer Brand Relationships
During a recession remember your current customers. Experts agree there is no better time to focus on clients who are brand advocates. It is far cheaper to keep current customers than to attract new ones. Your current customers understand your brand. They have an affinity with it.
5. Increase Consumer Confidence
Reduction in sales corresponds to increases in consumer wariness. With cuts to wages and uncertainty in their future, consumers have become increasingly cautious in their spending habits.
Now is the time to use the strength of your brand to reassure customers. Convince your customers that they are making the right decision by purchasing your brand. Investing in building strong brand equity can lead to increased sales with customers developing a clear understanding as to the value of your brand. This information gives them the confidence they need to make the decision to purchase.
6. Remember Your Brand Values
Focusing on brand values can refocus the business itself and reignite the passion that drove the business in its early years. In a time where the negatives of the recession weigh heavy on consumer’s minds, being faced with a brand that is driven by passion, determination, inspiration, with clear values and purpose will stand out in the market and can inspire sales.
7. Customer Added Value
Consumer needs change in a recession. Purchasing decisions are often based less on convenience and more on price and value. Adding perceived value to a customer is far easier and has less of a direct affect on profitability than changing pricing structures.
Wow your clients at the various brand touch points and they feel they are getting more for their money than competing brands. Contribute good will, service during hard times and develop customer loyalty that will be stronger than ever when recession ends.
Abraham Lincoln once said “Give me six hours to cut down a three and I will spend the first four sharpening the axe”. Business leaders need to start sharpening their marketing practices, not cut them.
• Have you analyzed the changes to your market?
• How have you adapted your brand strategy to changing consumer needs?
• Can you streamline your branding to get a better return on investment?
What have you been doing to brand your way out of the recession? Leave a comment or drop us a line. We’d love to hear your success stories.