How your small business can thrive in a recession
Read on to find out how even during a recession, small businesses can do more than just survive, they can thrive.
As a small business you might be worried about how your company will fare during a recession against larger brand names. But we are here to tell you that not only can you survive, but you can thrive in a recession and we will show you how.
In a recession, small businesses have the perfect opportunity to carve a name for themselves in their sector or industry to succeed both in and out of the financial downturn.
Building a small, loyal community
As a small business, you’re aware of the power of a small, loyal customer base.
It will be extremely important to ensure that this audience remains during an economic downturn, as they will be the foundation of keeping your business afloat with incoming revenue.
You need to make sure that you launch iniatives and campaigns targeted at cultivating, and maybe even growing, this audience.
A great idea to do this is to use Social Media, speaking to your customers on a one on one basis; being personal and open to build trust and further strengthen their relationship with your brand.
Advertising during a recession – is it a good idea?
This is a big resounding yes.
With less companies advertising during a recession, it means cheaper and, more importantly, better advertising space to promote your brand. With less competition vying for the top spots on such channels as Google Ads, you could find that perfect location to advertise is suddenly a lot cheaper.
Not only this, but as there are fewer competitors advertising, you can stand out more with clever marketing strategies simply by being present where others are not.
The old phrase “out of sight, out of mind” is very much true for marketing. If a company doesn’t advertise, then consumers may well forget about them or be attracted to buy elsewhere.
For small businesses, recessions are the perfect time to grab the attention of your consumers and keep it.
Share of Voice & Market Share
Share of Voice (SoV) is a measure of the market your brand owns compared to your competitors, and could be your secret weapon for growth in the coming months and years.
With all things being equal, a business that has a Share of Voice greater than its Share of Market (SoM) is likely to gain a higher market share in the long run. Why is this? Well, because over time, as you continue your marketing activities, your brand recognition and equity will only grow, affording you a greater market share.
With your competition reducing its marketing spend to adapt to the current economic climate, your business has a huge opportunity to increase its Share of Voice, without needing to increase spend to do so.
With a reduced Share of Voice, your competition is naturally likely to see their Share of Market also reduce, as it follows in line with the market equilibrium.
Simply staying the course, and perhaps even increasing your marketing spend will see your business’ market share improve in the long-term.
Promotions and deals are a winner
It is no secret that, during a recession, consumers tighten their purse strings – so they will always look for the next big deal or promotion. This doesn’t have to be a big discount but make sure it is eye catching so consumers believe this is the best deal they will get.
For example, your business could offer:
- Free gifts
- Buy one get one free deals
- Money off their next purchase
Focus on your consumer – benefits are king
Another aspect of a recession, we have found, is that due to said tightening of purses consumers often feel they must justify their purchases.
It’s important to make sure the benefits of your products or services, as well as the benefits of buying from your company are clearly stated. But, how can you do this?
The key will be to keep them front and centre on all of your marketing assets and promotional materials.
One of the key questions you will need to answer before a customer will make a purchase is “what’s in it for me?”
Make sure your customers understand why they need to buy from you and what it will bring to their life. Ensure that the consumer finds it easy to justify the product, especially if you are selling a service or item which could be classed as a luxury purchase.
It’s vital that your messaging clearly and confidently states the value your benefits will deliver to your customers in places such as:
- Product pages
- Advertising copy
- Your homepage
- Social posts
- Email signatures
- Business directories
Free Recession Marketing whitepaper
During these unprecedented times it can be difficult to know how to market your business to communicate effectively with your audience.
However, history has proven, that for those that can afford to spend during current times, marketing during a recession not only provides short-term benefits, but long-term success that may not be possible to achieve during times of economic stability.
We have created this guide to show you that marketing during a recession is possible and can be just as successful and potentially even more so.