Finding Opportunities During a Recession

It’s on every marketer’s mind right now: how will we weather the year ahead in a sluggish economy that might become a recession?

The business leaders that approach the coming months — and perhaps even years — with fear will position their company with limitations. But the business leaders who look for opportunities during an economic downturn will be the ones who come out on top when consumer confidence and spending rebound.

While everyone else is bracing themselves, here’s how you can position your brand for success, both during and after a recession.

1. Watch Your Competitors Closely

Opportunities can come from what your competitors do or do not do during a recession. If competitors shrink, walk away from a part of the market or discontinue a product or service, it might leave a gap in the market.

But you’ll need to respond quickly to meet customer needs and fill that gap before someone else does. And you’ll need to stay prepared with the resources to lead the way into that abandoned market.

2. Choose Cutbacks Carefully

The knee-jerk reaction to a looming or active recession is to cut back on ad spending or eliminate the marketing department. These can be dangerous changes to make.

While you’ll need to manage expenses wisely, you don’t want to stop your marketing activities that are key lead and sales drivers.

And instead of viewing ad spend changes as cutbacks, it might be smarter to look for reallocation opportunities. Other companies will be making changes to their ads. If you’re looking for opportunities, you’ll target the gaps instead of eliminating advertising dollars.

Gaps might come from areas where others are struggling or from markets that emerge as a result of the sluggish economy. We’ll cover more on emerging and changing target markets in number 5.

3. Invest in Innovation

The world changed rapidly in the two years leading up to the economic downturn. Innovation reigned supreme as companies looked for ways to meet customers where they were at with the challenges the COVID-19 pandemic presented.

Innovation often comes from finding a solution to a challenge, which is why some of the best ideas have come from economic downturns.

4. Position Your Online Presence for Success

The concept that a company’s online presence is essential to business success is nothing new. But when consumer spending decreases, it’s more important than ever that you be there when your customers need you.

If your website is the only one that is formatted for accessibility, you’ll cater to an often-overlooked market and build goodwill with your customers. And you’re more likely to avoid costly expenditures related to a lawsuit against your company for failing to make your website accessible.

Accessibility isn’t just about those with permanent disabilities. Some have temporary or even situational reasons they can’t use your website’s primary functions. Never count these customers out. Plus, it’s great for SEO.

5. Take a Hard Look at What You’re Selling and Who You’re Selling It to

Your products and services might not meet market demands the way they used to. Changes in the economy lead to changes in consumer needs.

Pause and take the time to evaluate who your customer is. Review your customer personas to see what might have changed. What new pain points are your customers facing and how can your products and services address those needs?

It might be time to sunset a product to make way for a new one that is better suited to today’s economy. For example, during the 2008 recession, fast casual dining skyrocketed while many mid-scale restaurants closed their doors. When consumer habits change, companies need to be ready.

6. Use Analytics to Guide Decision-making

Companies need to review expenses to become leaner. But in the process, they might lose crucial marketing activities or even staff that will have a massive impact on their success when the economy rebounds.

Before you start slashing expenses, review analytics. Don’t start your marketing plan with all the initiatives you did last year. Be picky, and only move forward with the revenue-driving activities.

In the process, you might find you can remove unnecessary expenses, capitalize on wins and protect staff members so you’re ready for post-recession success.

And if you have to make tough decisions, consider creative ways to protect your staff. During the 2008 recession, Honeywell furloughed its staff for one to five weeks and paid the team members partial compensation or none during those periods, based on local employment law.

The move saved an estimated 20,000 jobs and kept Honeywell operational throughout the economic challenges while positioning it for success as the economy came out of the recession.

The company had suffered serious repercussions from cutbacks during the 2000 recession when it cut many jobs. In comparison, Honeywell had higher sales, better net income and improved cashflow when using strategic furloughs instead of layoffs.

7. Focus on Quality Relationships

Relationships are always important for business success. But during economic challenges when a customer’s funds are spread thin, relationships can be the deciding factor in where the customer’s funds go.

But you also have to think long-term. Even if the customer makes no purchases during the economic downturn, your relationship with them could be a deciding factor about where their business goes once the economy rebounds.

8. Rediscover Your Brand

Since you’ve taken the time to evaluate who your target audience is and what their needs are, you might need to adjust your brand to fit that new audience.

Review your brand documents in light of your new customers. Does it still fit? Are the voice and tone right? Are you depicting these customers in your materials? Does your key consumer benefit still resonate with your new audience?

Rediscovering your brand doesn’t mean changing a logo or brand colors, necessarily. It’s more about reviewing who you are and what you stand for to ensure it meets modern demands.

9. Plan for the Long Term

Looking past the recession is challenging in the here and now. But course-plotting for your marketing products can prepare you for success on the other side of a recession.

While you might not execute the plans now, having them in place, knowing what staffing you’ll need to make it a reality and completing the necessary pre-work will help you be first out of the gate.

10. Check in on Your Staff

One of the most challenging things a leader has to do is make staffing decisions during hard financial times. And that often means carefully considering what positions to eliminate.

Take a step back and evaluate what you’re asking your staff to do. If you have a major project on the horizon, consider hiring contractors to take on that project instead of piling it on your already overworked team. While spending money on contractors when you’re trying to operate as lean as possible might seem counterintuitive, losing key staff members to burnout could also have serious financial implications.

And while you aren’t doing as much hiring, ask your HR team to spend some time reviewing employee onboarding, training and internal processes. Is branding a part of your onboarding process for all employees? How are you ensuring that your employees understand who you are and what you’re offering customers?

These processes will be crucial once the economy revs back up. You’ll be glad you spent the time and investment in improving your onboarding process.

At Design Positive, we help companies build strategic brands that resonate with customers in any economic environment while doing it all in an access-to-all approach.