It’s Time to Recession-Proof Your Marketing Strategy

Experts seem to agree, a recession is on the horizon for the U.S. Forty-one percent of U.S. businesses say they are extremely concerned about an impending recession according to a June report from Sapio research, while only 5% are not at all concerned. Now, as budget season for 2023 approaches, brand marketers need to think through how a possible recession can affect their spending.

There’s an old adage that says, “you have to spend money to make money,” and this is certainly true during a recession. Though it may seem counter-intuitive, research shows that marketers who maintain or grow their marketing budgets during recessions are more successful than those that cut budgets. In fact, 60% of brands that increased media investment during the last recession saw ROI improvements according to the recent ROI Genome Intelligence Report from marketing intelligence provider Analytic Partners. On the flip side, brands that cut spending risked losing 15% of business to competitors that boosted their spending.

Thirty-two percent of U.S. businesses surveyed by Sapio are already planning to expand their investments in sales and marketing activities amidst the impending recession, but simply pouring more money into these efforts is not enough.

Brands must utilize the right tools to help them understand their business landscape and optimize media spending to ensure they have the right partners on hand to help boost the impact of their dollars. Even if companies decide to shrink budgets, having the right resources on hand can maximize return on ad spend.

 While “spray and pray” is never a sound strategy for ad placements, targeting becomes more important than ever when trying to justify budgets during a recession. First- and second-party data is crucial here because it guarantees a direct link to customers and helps to best plan where dollars should be spent.

There are more tools than ever to help brands get in front of the right audience, such as programmatic, paid search and social ads, but without proper targeting there is no guarantee that the intended audience will see the ad in question. Even with that essential first- and second-party data in hand, much of it is delayed, costly, and limited in geographic accuracy.

Without the right data on hand, this can mean inefficient and ineffective spending, and a low ROI, which is bad at the best of times but detrimental in a recession. Marketers should look for unique solutions that can deliver real-time, hyper-local results to assist with strategic planning. For brands and retailers who deal with illness-related products, including healthy foods, cleaning products and over the counter medication, that means having access to and understanding of symptom-specific and DMA-specific data.

For example, when programmatic media partner MiQ leveraged illness data from Kinsa Insights on behalf of its national drug retail clients, it saw a 3:1 ROAS and 8.3% sales lift when compared to targeting based on the standard data provided by the CDC’s ILINet, which is weeks behind. Not only did this help determine where to target, but it helped optimize messaging based on what made sense in each location based on symptom type in the moment.

Marketing Technology News: EYEMAGINE’s HubSpot Magento Integration Joins the HubSpot App Marketplace

In the same ROI Genome Intelligence Report, it’s noted that half of the brands that increased marketing spend during the recession saw growth in back-to-back years. This is critical because the cost of requiring a new customer through advertising is high, but the lifetime value of that customer can boast a 20-30x return on investment or more.

Having partners that understand the new needs of brand teams during times of both illness and recession uncertainty can not only help companies stay afloat, it can also help them grow. If you’re a brand that has potential for frequent, repeat purchases, this is especially important.

While many brands are still rebounding from COVID-19, there’s no time to delay getting a recession-proof marketing strategy in place. Knowing that time is short, platforms like Meta, Amazon, The Trade Desk and LiveRamp have integrated with Kinsa Insights to help provide marketers with predictive and real-time illness data. In the long run, Kinsa Insights has helped clients with a 3:1 improvement on ROAS.

If the U.S. economy is able to rebound and stave off a recession, employing these recommendations will only help strengthen your business goals.

Marketing Technology News: Choosing an Identity Resolution Vendor – What to Keep in Mind