You’ve seen the stock market go up and down more times than a roller coaster this year. You’ve also heard rumblings from major banks, CEOs, and economists. This is not a drill: we could be entering a recession by the end of this year. So … what are you going to do? If you’re a small business, how are you going to prepare?
There a lot of factors that influence what next steps are when a recession hits. A couple of years ago, at the start of COVID lockdowns, we had a small recession that ended quickly. Back in 2008, we had a major recession that was felt for years after the stock market crashed. Experts are warning that another 2008 level recession is looming.
Of course, some scrimping and saving is always required, but a recession makes the need to cut spending even more dire. But what shouldn’t you slow down spending on? Your marketing! In fact, you should position yourself even more with these recession-tailored ideas.
Become a resource
If you run a business like a car service or a dentist’s office, your customers will come to you regardless of a recession. These businesses are widely acknowledged as necessary to sustain your day-to-day. As you know, missed oil changes can spell engine repairs, skipping a cleaning can spell a filling or even root canal work. Missed small expenses charge interest by turning into big, unavoidable expenses later down the line.
Rather than focusing on the doom and gloom, remind your customers how much money your customers and patients will save down the line by keeping up with routine visits and maintenance. Set up reminders on social media, through eblasts, or even in your message on hold. Also, educate your customers on simple ways they can save money so they don’t need to see you as often (healthy brushing habits, proper braking techniques, etc.).
Offer ways for your customers to pay if they’re strapped on cash. This could mean switching to a package model, akin to streaming giant Netflix. For new clients, offer a sliding package could help seal deals and your bottom line.
Another way to keep people spending is to create a membership program where members have more opportunities to save. People love savings, so joining a membership program where they can receive exclusive deals is a way to drive business, especially as people will be pinching their pennies more. If you create a program that helps people enjoy the experiences you offer without feeling the hit to their wallet, you’ll create added value and more loyal customers.
Ideas for these programs include a “punch card.” You’ve seen these at coffee shops – punch your card ten times, and a free drink is all yours. More ideas include promotions for eblast subscribers, contests, and mailers.
Concentrate on Savings
The Five-Dollar Footlong wasn’t a staple of the 2008 recession for nothing. By concentrating on the low price of a large sandwich, coupled with a memorable jingle, Subway brought customers in by offering a product that could give them a cheap, filling lunch. And depending on the customer, they could take their sandwich, eat half for lunch, and save the rest for dinner.
Yes, there are cheaper ways to get a meal out there, but by rebranding their footlongs as a cheap, easy, lunch and a good deal for their customers’ wallets, they got people in the door. Granted, the promotion wasn’t without its problems. As Vox details, the cost of goods vs. the low price became unprofitable according to many franchise owners. Moral of the story: make sure your promotion can turn a profit for as long as it runs.
If your business is seen as a luxury that should be skipped if money’s tight, you may expect business to drop in a recession. That’s not necessarily the case. Luxury services and goods can still sell well in recessions. It all boils down to an intangible level of value that people see in your business.
From comfort to the idea of a treat, your marketing should really hone in on what people want from you. Whether that’s a reprieve from their everyday or something that puts a smile on their face, don’t be afraid to “tempt” people at your business.
Make an indulgence a necessity or be the “devil” on your customer’s shoulder egging them to treat themselves in these trying times. In fact, Harvard Business Review stated that customers during a recession value treats right behind necessities. If your customer finds the little treat justifiable, they’ll buy it. So don’t be afraid to “tempt” people with treats like a free item with a purchase or putting out more tempting knickknacks at the counter.
Don’t neglect your marketing!
In a recession, you don’t want to let up on marketing. Forbes concurs: the companies that stayed afloat during the last major recession tapped into their customers’ changing spending habits, and not just the last one: “advertisers that maintained or grew their ad spending (during a recession) increased sales and market share during the recession and afterwards.”
So if you want to survive, and thrive after we get out of whatever storm is coming our way, don’t do what every other business is doing: put yourself ahead of the competition and market yourself, specifically as someone who can make the recession bearable for your customers.