Winning companies don’t make MarTech cuts
Historical data says it all: During the financial crisis of 2007-2008, the companies that chose to invest in marketing and sales became the winners both during and after the crisis.
Source: S&P Capital IQ; Bain Sustained Value Creator analysis, winners (n=415) losers (n=3,449)
It makes sense if you think about it. In modern times, a financial crisis lasts about a year. It’s not a lot of time in the grand scheme of things, but the choices you make during this time can be devastating.
In fact, past crises show that many companies take several years to recover from a year of slowdown, unless you take steps to turn a crisis into a success.
Did you know?
of companies don’t survive a recession
of surviving companies don’t regain their profit levels after 3 years
flourish after a slowdown, outperforming competitors by at least 10%
In fact, a crisis is an amazing chance to get ahead of the competition!
Make sure to create a positive presence for targeted audiences, while your competition is laying low. Instead of running outdated campaigns or uncritically targeting everyone, you can connect with your audience in a way they will notice.
The Covid crisis paints the same picture. Our brand-new report “The MarTech Challenges of 2023” shows that customer habits from COVID-19 times are expected to stay if the customer experience is satisfying. In other words, if customers have a good experience with you during a crisis, they will stay with you far beyond that.
"What is certain from the 2008 experience and earlier recessions is that 'going dark' by pulling all brand advertising brings the real risk of permanently weakened business performance. It is sensible to debate the tone and nature of brand advertising to recession-hit customers, but not the importance of it."
Buyers are pickier - play the long game
During a crisis, it’s all-important to invest in targeting, messaging, and positioning. The goal is to make the most of every lead – whether the conversion happens now or in the future.
Why? Because the sales cycle gets longer as buyers become more careful with their money. They want to make sure they spend their money on the right product – not just whatever is available.
That’s why you need to be even more strategic with your targeting. Unify all your customer data with a CDP, build audiences based on buyer behavior and preferences, and target them through e-mail, on Facebook, or other platforms.
3 ways to invest in growth:
1. Invest in data:
Get to know your customers and their intentions – not just right now, but in the future. A CDP gives you access to each customer’s Customer Lifetime Value (CLV), showing you an estimate of their past, current, and future value – and whether they are about to churn. It gives you the necessary insights to help you organize your marketing budget. Spend your money on the customers that are the most likely to spend with you – and stop wasting resources on the ones that are far gone.
2. Think about which channels you use – and how:
You need to carefully consider how to use your ad spend. We recommend targeting your best customers with personalized ads on platforms like Facebook, YouTube, and Instagram. The less lucrative customers can be ‘warmed up’ through platforms like e-mail that are less cost-heavy than paid ads on social media.
3. Play the long game
It’s not that your visitors don’t want to spend money on your products – they just don’t have the funds right now. Instead, you might want to target them with a Price Drop Trigger that sends them an e-mail if a product they looked at has dropped in price. You may also want to show them personalized Content Recommendations that help and inspire them on their favorite topics – and keep you top of mind once the money is back in their wallets.
Did you know...?
"During the last recession in 2008, online advertising revenue actually grew by roughly 20%"
It’s not just about spending
– it's also about your brand
Everyone is in the same boat when it comes to the ongoing inflation crisis – and like every other storm, it will pass. But if you pull the plug on your marketing, what will your brand look like when you’re on the other side?
That’s why the historical data tells a clear story: Make sure to fully utilize every part of your tech stack – and invest where you fall short.
While your customers might hold back on spending money now, they will remember your brand and the messages they receive from you. Once they’re ready to buy, you will be top-of-mind. This was true during the pandemic – and it will repeat this inflation.
Keep delivering the positive customer experience that your competitors are cutting back on. The choices made now are crucial when crowning the winners and losers of this crisis – and future ones to come.
We created a report about CMO challenges in collaboration with McKinsey. The report will take you through the challenges of Martech 2023 and how to turn them into opportunities for you and your business.