Inflation. Supply chain issues. Labor shortages. Drought. War. Soaring fuel and food prices. Interest rate hikes. And now worries about a recession on the horizon.
Unfortunately, we have been here before. But many of us were too young to understand previous economic crises. I was aware of but didn’t fully grasp the conversations my parents had as interest rates soared to nearly 20% in the 1980s. I am not too young, however, to remember the recessionary wave that this country experienced nearly 15 years ago.
As a marketer, I am always curious about how marketing can help companies succeed during these difficult times. To aid this effort I took a look back at what history can tell us. Below are the highlights from my research.
Remember your brand is your second greatest asset.
If you sell branded product, don’t lose sight of the fact that your brand is one of the greatest assets you own. While it is often hard to place a quantifiable value on a brand when compared to other capital expenditures, your people and your brand are the most valuable assets you have. Unfortunately, many in the meat industry don’t think of it that way. Brands allow you to differentiate yourself from commodity and private label. Brands give you the ability to communicate directly to your end users about the things that are important to them and solidifies the reasons they buy your brand even in tough times.
Keep marketing, don’t cut budgets
For some, the intuitive reaction when sales soften is to slash the marketing budget. Don’t do it. Cutting marketing efforts can be deadly to future growth. I shared this research in an early COVID-19 blog post. It is once again pertinent: The Kantar Millward Brown database that measures brand equity shows that it took brands three to five years to recover to pre-2008 recession levels when they cut their marketing budget in half or went dark for a year, compared to competitors who kept their marketing efforts going.
Want proof that a counterintuitive measure of increasing efforts has significant long-term gains? This meta-analysis of 40 studies, published in the Journal of Advertising Research, stated, “Firms that increased advertising during a recession experienced higher sales, market share, or earnings during and after the recession.”
Focus on authentic, empathetic messaging
Most of us are in a cost-of-living crunch: everyday necessities cost more, leaving less for discretionary spending. If you want your brand to survive and thrive, it’s critical that you show your consumers you can relate to these challenges.
The best way to do this with your marketing is to demonstrate value while also showing empathy.
Most of you know how to promote value so I am going to focus on the empathetic part here. Just because consumers have tighter budgets does not mean they don’t want to engage emotionally with your brand. Empathetic messaging is critical because it allows your brand to connect on an emotive level, capturing attention and providing an authenticity that leads to positive feelings toward your brand – these are important drivers that impact real-life shopping habits.
Adjust your messaging to ensure you are talking about the things that are important to your customers right now. Explain that your costs are increasing too. Doing so will keep you real and help them justify the package cost of your items.
Here are some thought starters to get you going:
- Slightly decrease the portion size (aka “Shrinkflation”) then promptly alert consumers you have done so in order to keep the price point the same. Warning: you must tell your customers that you reduced size so they don’t think you are trying to pull anything over on them; otherwise, all authenticity is lost.
- Provide suggestions on how to stretch the meat purchase to feed more mouths or be served for more than one meal
- Modernize your recipes. If your recipes have not been updated to include the appliances everyone bought when we were all stuck at home in COVID isolation, now is the time to add instructions for how to cook meat in air fryers or instant pots.
- Share your brand’s impact on the greater good. Use current high fuel prices as a launching point to share your efforts to make your brands more sustainable.
Don’t lose site of the other end: Premiumization
Not all consumers are impacted by these economic times the same way. Some consumers may be trading eating out for eating in, but still want a fantastic meal. This mental “trade down” doesn’t necessarily mean all the way to what is on ad, but instead to something still deemed high quality and more upscale at the meat case.
While the overall size of this group may shrink during this economic turmoil, they can be highly profitable consumers, deserving your time and attention now so that they don’t switch to a competitor brand when things improve.
If I have held your attention to the end, I hope it is because you have some things to think about. Take a moment to step back and look at your current marketing with fresh eyes. What is your marketing doing now to create an impenetrable force field around your brand to ensure longer-term growth beyond the current economic crisis?