5 reasons you should keep your marketing going through a recession

Recessions are a challenging time for most businesses. As the economy slows, consumers become cautious with their spending. In 2023, we’re seeing revenues drop, interest rates soar, and layoffs mount as businesses try to keep their heads above water. It’s no surprise that when businesses are looking to save money, they make budget cuts. Often seen as non-essential costs, marketing budgets are slashed, if not scrapped entirely. But these cuts are often short-sighted and can hurt businesses long-term.

Here are 5 reasons to keep your digital marketing going through a recession.

1. Maintain your momentum

When businesses choose to ‘go dark’ on digital marketing, they mistake it as a light switch that can be flipped on and off whenever they need it. This could not be further from the truth. Consider this: after just six months without advertising, the average consumer brand awareness decreases by a whopping 24%. Twenty. Four. Percent. It’s not only brand awareness that plummets but also long-term revenue. According to Neilson, brands that go quiet can expect to lose 2% of their long-term revenue each quarter. Additionally, it requires 3-5 years to recover equity losses resulting from that downtime.

“Advertising isn’t about profiting during a recession; it’s about capitalizing on recovery”

– Peter Field

We experienced the lasting negative effects of turning off marketing firsthand. Last year, through an extremely busy time, we decided to put blogging on pause for the first time in over a decade. We had been seeing consistent increases and ‘bests’ up until this point. As you can see in the graph below, our search impressions, clicks, and CTR took an obvious nosedive which hasn’t completely recovered yet, months after resuming our blogging efforts (darkest green is best, darkest red is worst).

As scary as recessions are, the good news is that many recessions are short-lived.  Historically, 75% of recessions end within a year, and 30% of those only last two quarters. Canada has experienced five recessions since 1970, averaging three to nine months in length. Over the last 95 years, we’ve had multiple world wars, recessions, terrorist attacks, and other cataclysmic events that have led to economic hardship. The lesson here is that neither good nor bad times last. Despite how it feels in the moment, things can get better.

It’s no secret consumer spending dips during recessions. But if you’re not finding ways to stay relevant and top of mind, you’re going to have a hard time when the economy stabilizes and spending returns. If you flip the light switch off, don’t be surprised that the light is dim when you turn it back on. This is an important factor when considering cuts that could alter the way your business heads into the bounce-back period that’s around the corner.

2. Acquire new customers

Larger well-established companies may use recessions as an opportunity to scale back to preserve the bottom line. After all, they have stock prices to worry about and shareholders to appease. For small to medium businesses that may not have the same financial obligations, recessions can be an opportunity to seize market share.

Nova highlights a few great examples from various industries that have taken advantage of economic downturns of the past:

• 1973 recession: Toyota increased its ad spend at a time when everyone had dropped theirs. Toyota went on to become the top imported car maker in the US by 1976.
• 1991 recession: McDonald’s dropped its advertising budget which Pizza Hut and Taco Bell took advantage of. Pizza Hut sales grew by 61%. Taco Bell sales grew by 40%. McDonald’s sales declined by 28%.
• 2009 recession: Amazon grew sales by 28%. Amazon continued to innovate and launch new products, like the Kindle, during the recession. The result? There were more eBook sales than printed books on Christmas Day 2009.

Investing legend Warren Buffet once stated: “be fearful when others are greedy and greedy when others are fearful”. Recessions are tough times filled with uncertainty, but for those who can seize the opportunity, it can transform their business’s future.

3. Take advantage of cheaper ad inventory

As of Q4 2022, 46% of US companies have already slashed their marketing budgets in anticipation of more turbulence in 2023. As more and more businesses flea the advertising space, competition on ad platforms plummets. In 2022, ad spend on Google dropped drastically. Google owns 26.4% of the online ad business and is seen as the darling of the digital advertising space. If advertisers are pulling their Google ad spend, you know something is going on. Nonetheless, this can be good news for those who stay engaged. Less advertising demand means more available inventory which can lead to lower CPCs for advertisers. Conversion rates may decrease as consumers have less disposable income, but the cheaper cost to engage your high-value audiences can be worth it.

Still not sold? According to the Analytic Partners report, 60% of brands that increased media spend during the last recession saw greater ROI, and those that spent more on paid advertising saw a 17% increase in incremental sales.

4. Your audience is more attentive

When times are tough, people are less likely to go out. Instead, they stay home more often which usually means spending more time online. Whether it’s binge-watching YouTube, scrolling through social feeds to pass time, or streaming podcasts as they tackle DIY projects—your audience will continue to exist online.

For B2B, that can mean your audience is seeking professional development in the wake of the recession or looking for resources on how to stay lean. This creates a massive opportunity for content marketing and paid ads.

Not only is advertising cheaper during a recession, but your ads can deliver more impact due to reduced competition. When times are good, everyone throws money at marketing which can create a saturated environment that is difficult to break through in. The fewer the ads, the more likely your message gets through to your audience at the right place and right time—which is what matters. For these reasons, digital advertising can be a very effective way to reach your target audience.

Paid social can be a great option during a recession because, for many businesses, it’s where your audience lives. In 2023, there are expected to be 4.89 billion social media users worldwide—a 6.5% increase from a year ago. Not only are the total number of users rising, but the average person now spends 2 ½ hours on social media.  That’s a 5% increase in the amount of daily time spent from 2020. Whether you’re an e-commerce startup running display ads or a professional service firm delivering curated content to your audience, paid social allows you to target your audience when you want and how you want.

Likewise, paid search and SEO are other ways to stay top of mind. Consider the graphic below and the amount of traffic you receive based on your Google ranking. Search can keep you on the front page and in the headlines. While your audience may not be ready to buy at that moment, there’s value in the brand awareness you gain and maintaining your Google rank.

5. Improve brand perception

Nobody likes being ghosted—not by your last Tinder date and certainly not by businesses. If you’re loyal to a brand and pay for its goods and services, the least companies can do is stay involved in the consumer-business conversation. By investing in digital marketing and engaging your audience you’re doing just that. You’re staying connected and creating a partnership with your loyal customers. Doing this can grow a brand’s favourable public opinion in the long term.

Positive brand perception is invaluable. Seeing consistency throughout a recession and familiarity with a brand when individuals have lower buying power can help future sales. This can then pay dividends in the years following when the inevitable economic recovery comes.

Take the Adidas #RunForTheOceans campaign as an example. In the midst of the 2022 COVID recession, when people weren’t racing out to buy sneakers, Adidas tied their brand to their social mission of environmental sustainability which made them relevant given global uneasiness due to climate change.

With a goal to clean up plastic waste from beaches around the world, the campaign called on people to join their movement. For every 10 minutes of running, 1 plastic bottle is cleaned up by the nonprofit Parley for the Oceans. The campaign resulted in over 6 million participants, more than 770 million minutes ran, and 500,000 pounds of plastic waste cleaned up. Not only did this campaign help the planet, but it also generated positive emotions and associations with the Adidas brand. During a time when people were struggling, Adidas continued to show up and show they cared. Recession marketing at its finest.

Stay active. Stay positive. Stay engaged.

We’re speaking from experience

Stryve was founded during the peak of ‘The Great Recession’ of 2008. The outlook was bleak for the economy and recovery didn’t seem imminent. Regardless, our founders, Ryan and Sourov, remained adamant in their belief that social media marketing was going to transform businesses. They were determined not only to make it through the recession but to come out stronger by investing their time into digital marketing. Stryve triumphed through rocky times and has partnered with clients for 15 years to help them do the same across B2B industries.

We know firsthand that navigating recessions isn’t easy. It puts many leaders in extremely tough positions. Every business and every situation is unique. There is no instruction manual on how to handle economic downturns. But if you’re willing to follow the data, find creative ways to reallocate budgets, and invest in digital marketing during tough times, you are setting yourself, your team, and your company up for long-term growth. If you’re looking for a partner to help you do that, we’re here.