The truth is that no matter how hard you try with your marketing, not every business will prosper when there is an economic downturn. Some industries are heavily reliant on the state of the economy, such as luxury clothing brands or the travel industry. However, other industries can see great success with marketing during an economic crisis, especially if they market themselves properly.
Which Industries Can See Success From Marketing During an Economic Crisis?
The Harvard Business Review has an excellent chart showing how different consumer segments spend in an economic downturn. It is highly recommended you look at this chart to predict how consumers will spend in relation to your industry. Typically, the industries below will be financially unaffected, and could even prosper during an economic crisis.
Home Improvement & Repair Businesses
With our company based in northwest Florida, we have definitely seen this industry do well in times of economic crisis. This typically happens in the form of natural disasters, the most common of which, in Florida, is hurricanes. Businesses that can help with repair and restoration are often inundated with jobs. In fact, we had one client who was providing a home repair service in the entire southeastern United States. But, after a hurricane made landfall in Florida, they shifted all their focus to the one area of Florida that was impacted the worst. Their business skyrocketed and they spent a whole year in that one market, prior to branching out again. Though it’s a bit dated, here’s a related article you may find interesting, published by CNDC in 2017: https://www.cnbc.com/2017/09/26/investors-start-cleaning-up-with-disaster-recovery-boom.html
Along the same lines as home improvement and repair businesses, companies that focus on providing restoration will also thrive during times of economic crisis. Again, natural disasters can cause problems that require these types of services. For example, after a hurricane hits, there is often flooding. As a result, a restoration company will be called in to repair the damaged floors, walls, furniture, etc.
Fast Food Restaurants
An industry that seems to maintain profits in economic downturns is the food service industry. Whether the economic crisis is caused by a virus outbreak or something else, everyone needs to eat. While sometimes eating at restaurants can be a luxury, other times people have no choice. During times of food shortage or damage to homes, many people have to turn to eating out to get food. Restaurants with affordable items on their menu can leverage an economic crisis by offering low priced options or offering a to-go or delivery service.
Essential Health Services
There are many reasons why companies that provide health services will continue to do well in times of economic crisis. For one, many people will be concerned about losing their insurance, if they are laid off. As a result, they will often make a point to get prescriptions refilled, get examinations done, and do anything else they can, while they have insurance.
Another reason this industry does well is because many people will need medical attention. For example, if people are injured due to a mass fire, there will certainly be a local or regional economic crisis. But at the same time, many people could be hurt and need to be taken to the hospital for care. And of course, if a virus spreads around the globe, there will be plenty of people wanting or needing to get checked out at a hospital.
Most people place high value in having good health. Even if a crisis has occurred, health services will still be sought out.
An economic crisis can be quite beneficial for thrift stores. Consumers don’t necessarily need to spend money on full-priced products, such as furniture, clothes and kitchen supplies. If quality products can be sold for a fraction of the cost at a thrift store, then great! This is the perfect shopping solution for many individuals who might not ordinarily go to a thrift store.
Why Should Businesses Still Practice Marketing During a Crisis?
Just because money is tight, it does’t mean marketing should be eliminated altogether. When you stop marketing your business, you will experience an even lower number of sales. If you must adjust your marketing budget, consider reducing the budget by a certain amount. Then, adjust the marketing plan so you still move your business forward, in accordance to the revised budget. And definitely focus on the tactics to bring in the highest ROI. Talk to your marketing director, team or consultant about this. Identify opportunities to help you continue to do well. Also, see if this economic crisis will enable you to pull ahead of your competition, or embrace new opportunities that will help you make a greater income in the future.
Another consideration is the duration of the crisis. If it’s literally the end of the world, you should probably close shop entirely. But, if it’s merely a hick-up in the economy, then continue marketing as usual. One smart approach to take is to reevaluate the projected gross revenue for the year. If your marketing budget is based on expected gross revenue, then adjust the budget accordingly. For example, if you expect to see a 10% drop in sales, talk to your marketing team about how best to operate with a 10% decrease in marketing expenses. Then again, if you think you’ll see a 200% increase in sales, adjust your marketing budget in the same way.
How to Appropriately Market Your Business During an Economic Crisis
One of the most important things to do as a marketer or business owner during an economic crisis is making changes to your marketing strategy. As people are struggling to get back on track or feel comfortable spending, you will need to update your marketing approach. This will help you to increase your sales and maintain a good brand reputation.
In the same Harvard Business Review article linked above, they also have a chart discussing the best ways to tailor your marketing tactics. This chart can be a great guide to changing your marketing tactics for your business so you don’t experience a hard hit to your sales. However, there are some other factors that should change during these times, which we have listed below.
Be Sensitive to Victims of the Crisis
Showing sensitivity to the victims of a crisis can go a long way in boosting your brand reputation. Find a way to show your customers or clients who have been negatively impacted by a crisis that you care. And keep in mind that they may be a bit on-edge or sensitive at this time. Or more appropriately, they could be under a ton of stress. So, keep that in mind while interacting with them.
Focus on How Your Business Can Help Victims
Taking this one step further, identify ways to help the victims of an economic crisis. Of course you can do this because you simply WANT to help. Or you can do this because you feel like it’s a good thing to do. And in reality, those are the best reasons to help the victims of a crisis. Altruism can certainly enhance your brand image and reputation. But consider this as a great public relations opportunity as well. Not only can you help people, but you can also show potential customers or clients that you care. In fact, one of the characteristics millennials like most about a company is whether or not they care about society and make a point to positively impact the community, or a cause. Helping victims is a win-win.
Consider Offering a Discount on Services or Creating a Low-Price Option
Those who need a little extra help can certainly benefit from receiving a discount or low-price option. This can actually be a good way to introduce your products or services to someone who might not ordinarily make a purchase from you. And remember, this doesn’t have to be a permanent discount.
GoDaddy, for example, makes it standard practice to offer discounts and freebies. If you purchase a domain from them, they typically offer it at a discounted rate for the first year, then full price every year after that. Also, they will sometimes give you a free domain, when you purchase website hosting. There are other benefits they will give. But in the end, you will continue paying either full price for discounted services or your will pay renewal fees for something you might not even need. This same type of concept can be implemented to those in a crisis. Help them out when they are in need, then retain them when they are on their feet again.
Change the Language in Your Advertisements or Posts
Some businesses experience marketing failure because they don’t adjust their messaging to the current situation. For example, if you’re a restaurant and something like the coronavirus has closed your dining room, then don’t tell people to come by and rent event space for a birthday party. That might be great during normal times, but adjust the messaging. Instead of promoting event space, you might promote your food delivery services.
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Establish Trust With Your Customers and Target Audience
One of the most important elements to consider is the trust factor. If you have clients or customers before the crisis hits, and then you flake off and become undependable, that will not help inspire trust. Granted, there are certain industries or situations that will force you to close your doors and stop providing services. But, if you are able to demonstrate a desire to truly provide value to your existing and prospective customers or clients, then this well help establish and strengthen trust. And trust will ultimately lead to increased sales and customer retention.
Marketing to Victims of an Economic Crisis
In times of economic crisis, there will always be people who struggle. Sometimes this is avoidable and sometimes it isn’t. Of course, do what you can to help those around you. But also, give some consideration into the marketing for your own business. Is there a way to make your business thrive during an economic downturn? If so, how can you adjust your marketing strategy to capitalize on the opportunity? This type of situation may be the perfect chance to catapult your business past your competition. And if so, it’s just a matter of figuring out the marketing strategy that will push you forward.
We hope you aren’t experiencing any economic difficulties. But if you are, and you have an idea of how to leverage your situation to your marketing advantage, let us know! And if you need any help refining or executing the plan, let us know! You can connect with us via the contact form below.