For the last couple of years, inflation and interest rates have been getting higher in European countries and tightening financial conditions, which of course, points out that a global recession is almost upon the world.
This situation is alarming for companies because when it is only a matter of time before we encounter economic downturns, marketing becomes more vital and difficult to compete than ever.
Surviving recessions and economic downturns is not just about trying to wash away the grime. It is more about making it through these economically difficult times by evaluating the maintaining or increasing marketing dynamics and creating a recession-proof marketing strategy.
With less money going around during recessions, consumer behaviour evolves as customers become more focused on price points, tend to switch brands more frequently, and prioritise their needs for essential products or services as a result of higher concerns about the cost of living.
Thus, understanding customers and consumer behaviour by conducting market research operations is essential for recession marketers to survive in these times.
Through this article, we will break down the benefits of market research tools and how you can double down on market research strategically during the recession. So if you want to come up with a break-free marketing strategy, we suggest you keep reading!
Why Conducting Market Research Is a Must in a Recession
Recessions and economic downturns create a flow-on effect on company forecasts and marketing budgets. In this kind of situation, market research becomes prominent as a practice to solve uncertainties and fill in the blanks.
Market research enables marketers to collect actionable insights and make informed decisions with a data-driven approach. In addition, conducting market research with high-quality market research tools can help companies to find answers to certain questions.
Can we add the revised actionable insights blog here when its ready.
How much has the recession affected the buying decisions in my target market? Which product categories should I invest more in? How can I optimise my marketing campaigns to provide a better customer experience? These are just a few of the questions you can answer with market research tools.
If you are curious to find out more about your target audience, product developments, or brand awareness, you can get your answers from Bolt Pulse. Let’s team up to evaluate your product innovations, marketing campaigns, and brand awareness!
How to Build Recession-Proof Marketing Strategies With Market Research Tools
Any company or business aiming to improve a recession-proof marketing strategy can be at a significant disadvantage without market research tools. The reason is simple. Market research tools enable companies to ask the right questions in each step of building a recession-proof marketing strategy. For example, innovation testing or product concept testing gives a better understanding of customers’ pain points and reveals if the target market values your product idea and is willing to go with it.
Of course, this is just an example of the steps you can take to build your strategy. You are in luck because the rest is just about to be discovered!
1. Understand the Shift in Consumer Behaviours
Recessions might require you to reconsider your overall marketing strategy. As customer understanding is at the heart of every marketing campaign or strategy, it is best to start by reconsidering the customers.
According to Harvard Business Review, consumers can be segmented into four groups according to their reaction to a downturn:
- The slam on the brakes segment: This group aims to reduce all types of spending by eliminating their purchases as much as possible. So for this type of customer, price points are key in buying decisions as they are fully concerned about the recession. Women in both the UK and France can be included in this segment, as 88% of them stated that they are quite concerned about the recession.
- Pained but patient consumers: These consumers keep their resilience about the situation but feel less confident about the products or services they use. This means that these consumers can shift their brand preferences
- Comfortably well-off consumers: The people in the top 5% income bracket fall into this consumer segment. These people feel secure about their ability to make a purchase and consume at near pre-recession Still, they might be a little more selective on products and services they buy.
- Live for today segment: Typically, younger generations fall into this group. While their concerns about the cost of living are complex, they are most likely to spend more on indulgences and experiences. In both the UK and France, 42% of women who stated they were concerned about the cost of living spent more on beauty products this year. This situation points out the “Lipstick Effect” which explains why consumers are more willing to spend money on less costly luxury goods.
How do market research tools help you to understand this shift in consumer behaviour? Well, qualitative and quantitative market research can help you figure out which segment your consumers fall into. Also, it can give you significant insights into brand preferences and brand awareness.
2. Reconsider Your Products and Pricing
Understanding consumer behavior is the biggest step you will take during creating your strategy with market research tools. Now that you have completed this process, you can take a step in the rest of the process quickly.
The next step is to reconsider your products and pricing points according to the current recession dynamics. Product and concept testing and awareness search apply perfectly here to evaluate your products and prices.
By conducting market research for product testing, you can simply ask your customers about their opinions on your existing products or services and measure their performance.
3. Invest in Your Branding
Investing in your brand awareness offers multiple benefits during downturn times by increasing the effectiveness of marketing campaigns and lowering costs.
A successful brand awareness campaign can enhance the loyalty of your customers, increase the effectiveness of your ad campaigns, and make it easier to start conversations with potential leads.
As a simple solution, you can go with search engines and Google trends. Still,
conducting market research about your brand awareness and collecting actionable insights with effective market research tools might be a better idea.
By utilising brand awareness research tools, you can measure your social mentions, ad effectiveness, and how your customers are connected with your branding and derive actionable insights for your future branding efforts.
For example, 40% percent of the women in the UK and France stated mixed feelings about how influencers affected their buying decisions. In a similar situation, you can use brand awareness or campaign evaluation tools to reveal if your target audience is into influencers or not. So you can clear out all the fractions for your brand awareness campaign.
4. Stay Relevant With Innovation
During a recession, companies can struggle to maintain economic growth. And if they forget to keep their branding, products, or services relevant to current dynamics they can even disappear. Thus, it is important to keep your products or services relevant by reconsidering their offerings and value propositions.
Here you can flawlessly utilise innovation testing, product concept testing, and concept testing surveys. With innovation testing, you can test new product developments, business ideas, and value propositions.
On the other hand, with concept testing and concept testing surveys you can evaluate the overall performance of your existing product, marketing campaigns, and messages. You can also conduct your research on a single concept or multiple concepts at the same time.
It’s Time to Aim for Thriving Rather Than Just Surviving
Getting prepared for any kind of downturn might seem daunting at first, but it can create opportunities for you to expand your marketing strategy, increase your ROI, and take one step further than others.
All you need is effective and useful market research tools that will enhance your marketing efforts during these strict times. Bolt Insight is here to help you thrive in this process by providing you with insights that are validated by your customers.
If you want to sit next to your customers, feel free to discover our solutions!