With inflation on the rise, gas prices through the roof, and the housing market reeling (thanks to Covid-19), many experts believe that a recession is on the horizon. Katy Bostjancic, a chief US economist at Oxford Economics, believes we will come “precariously close to tipping into a recession by mid-2023”.
According to the traditional definition of a recession, which is a fall in GDP for two consecutive quarters – we are already in a recession with contracting GDP for two quarters in a row (dropping 1.6% during the first quarter of 2022, the GDP fell another 0.9% in the second quarter.).
UCF’s Institute for Economic Forecasting says a year-long recession is on the horizon for the U.S.
The Conference Board forecasts that 2022 Real GDP growth will come in at 1.4 percent year-over-year and that 2023 growth will slow to 0.3 percent year-over-year.
Seeking Alpha suspects that as the Fed continues its aggressive mission to combat inflationary pressures, a recession in 2023 is likely.
Chances are, your business is already feeling the effects of inflated costs on your bottom line. This surely won’t be the first, nor the last time we experience an economic downturn. But whether you run a small business, middle market company, or a large corporation, that uncertainty can be frightening.
Harvard Business Review conducted a year-long study of 4,700 publicly traded companies during three different global recessions. 17% didn’t survive. 80% were playing catch-up to their pre-recession strength and 9% managed to grow despite the recession. How do you make sure your business is part of that 9 percent?
Pretty much every brand has a website. If they don’t have a website, they have a social media presence. But you shouldn’t stop there. Couple a strong online presence with a proficient, effective digital marketing strategy and you will level the playing field within your industry and provide your business with measurable, and cost-effective methods of achieving your goals. From Mckinsey & Company: “Customers are now spending more time and resources on owned-media channels such as websites, mobile apps, and customer-service channels. From a content perspective, there is also a noticeable increase in customer-conversion rates, with social and digital video channels driving the highest ROIs.”
Here are a few statistics that showcase the profound impact digital marketing has had across industries…
- 92.3% of smartphone owners use their phone to search online
- 70% of smartphone owners use their device to conduct research on a product before buying in-store.
- 70% of organizations list blog content as one of their top 5 content channels
- 86% of B2C marketers say content marketing is key to their strategy
- 72% of marketers say content marketing increases engagement and leads
- 75% of B2B buyers say they use social media to make purchasing decisions.
It’s clear that digital marketing isn’t going anywhere. An optimized digital marketing strategy should be able to survive economic downturn. When it comes to your digital strategy, is your business/organization prepared to weather the storm? Let’s go over a few tips on how to make your digital strategy recession proof…
7 Ways to Make Your Digital Strategy Recession Proof
- Build a Stronger Online Presence: Your ability to build and maintain a healthy online presence is vital to staying afloat during a recession. Focus on a long-term SEO and content marketing strategy to retain the interest of your target audience.
- Don’t Cut Out Marketing: One of the first things many businesses do when faced with hard economic times is drastically reduce their marketing budget. During the recession of 2008 and 2009, overall ad spending dropped 9 percent. Studies show that brands who continue marketing during a recession are most likely to survive. It’s okay to streamline your spending, but you don’t want to stop marketing entirely. With most other businesses (including your competitors) reducing their marketing during a recession, it’s the perfect opportunity to make sure your ad campaigns stand out!
- Optimize Your Website: Take a focused look at your website’s performance. Is your website optimized for mobile devices? Experts believed mobile commerce would control 72.9% market share of ecommerce by 2021, up from 58.9% in 2017. That prediction proved to be true. Which pages are getting suboptimal engagement? Is the conversion rate acceptable? Are your call-to-actions clear? Partner with a reputable web design company to come up with a data-driven plan to decrease bounce out rates, improve UI/UX, and keep your site in tip-top shape!
- Meet Your Customers Where They Are: Consider how your segmented target audience has adjusted to the economic crisis. Have their priorities shifted? Maybe they suddenly value the convenience of an online marketplace. Study your buyers’ changes in consumer behavior and meet their needs accordingly.
- Stay Consistent on Social Media: During a recession, people are more likely to stay home and save their money. That equates to a lot more time scrolling through social media looking for great deals on products and services. This is an excellent opportunity to attract new customers through social media marketing. If your budget is tight, it’s okay to reduce the amount of paid ads you’re financing, but don’t abandon your social media strategy altogether.
- Embrace Digital Transformation: Digital transformation will look different for every company. A Morgan Stanley survey indicated that nearly 10% of CIOs plan to increase spending on digital transformation in 2022. According to Deloitte, “digital transformation is all about becoming a digital enterprise – an organization that uses technology to continuously evolve all aspects of its business models (what it offers, how it interacts with customers and how it operates).” Digital transformation includes cloud migrations, creating an online marketplace, and developing multiple digital touch points for your brand. It’s one of the many services that we provide for our clients at J Arthur & Co. and it can help your business thrive even in times of economic turmoil.
- Find the Opportunity: While competitors pull back on marketing spending, find the opportunity to re-allocate your internal resources. Build strong, synergistic relationships with third party digital marketing vendors that can help you increase engagement, strengthen your message, and generate qualified leads.
What do we recommend in a nutshell? Maintain a strong online presence, don’t hit the brakes too hard on your marketing budget, keep your website in shape, grow with your customers, keep up your social media game, and embrace the digital revolution! As established experts in the industry, we guarantee these tips will make your digital strategy recession proof. We hope you flourish and prosper in the years to come. If you need assistance with executing any of these tips, we’re here to help.