Coronavirus/COVID-19 has decimated the global economy. Although it's nearly impossible to calculate the full extent of the economic impact of COVID-19, the most recent Global Economic Prospects report by WorldBank predict a 5.2% contraction of the global GDP as a baseline. This makes the financial crisis caused by Coronavirus the greatest economic recession in decades.
When times get tight and business becomes uncertain, companies have a tendency to hedge their bets and tighten their belts. During the Great Recession of 2008, marketing spending decreased by 18%.
This is entirely the wrong direction to take, however. There are figures going back 100 years showing the benefits of advertising during a recession. As the saying goes, "When times are good you should advertise. When times are bad you must advertise."
There's no telling what the future has in store as we continue to cope with the unprecedented changes as we adapt to life during Coronavirus. We're going to give you some tips for budgeting for marketing, even if there's still a recession going on. Simply doing nothing could cost you much more!
Budgeting for Marketing in the Wake of Coronavirus
Budgeting for marketing during a recession almost seems counter-intuitive. After all, business decisions are based on facts not hunches. When things are working properly, we take our quarterly reports, spin some projections, and use a simple formula to calculate a marketing budget. It's almost as simple as simply printing money ourselves.
Creating a marketing budget for 2021 is going to take more creativity, though. One of the first tips for creating a successful marketing budget is to lean into that uncertainty. Business is not for the faint of heart, after all. Those who stick it out and succeed during these unprecedented times stand to win big!
Here are some tips on how you should adjust your marketing budget for 2021.
Align Customer Expectations
Customer expectations have skyrocketed in the last ten years. Social media has increased the speed that customer's expect a response exponentially, for instance. 40% of customers now expect a reply within an hour of messaging, as an example.
Customers expect businesses to be available 24/7, as another example. Fast and free shipping have also become commonplace as people have gotten more used to online shopping.
Just because the world has changed due to Coronavirus doesn't mean that customer's expectations have. Even though customers might understand intellectually that there's a pandemic happening doesn't mean their emotions will react the same way. They're just as likely, if not more so, to get irritated with delayed responses or high shipping costs.
You should factor in the cost of keeping your customers updated and informed into your marketing budget for 2021. You might include a pop-up message on your website, for instance, alerting your customers to your current business status. Or you might incorporate a chatbot to field inquiries during off-hours. Even something as simple as automated marketing messaging will help ease your customer's anxieties and
Invest in Tools-&-Tech Trainings
Learning and adaptability have been integral towards business success in the digital economy. That doesn't mean that every business has prioritized staying on top of the latest trends and innovation in their field, though. If you haven't, now is the time to do so.
As part of your marketing budget, you should allocate some funds towards for sales and marketing team training on the latest tools and techniques. You might train your marketing team in how to construct marketing funnels, for instance. A copywriting lesson or two couldn't hurt, either, considering how dependent we all are on online sales at the moment.
You should also make sure your entire organization is as comfortable with remote collaboration software, as well. Make sure everyone knows how to use productivity software like Trello, for instance. You should also make sure your team has quality equipment for them to work at peak efficiency, also.
Update Your Website
Coronavirus has been an unexpected pause in business as usual. This actually has the potential of being a blessing in disguise, as it gives us an opportunity to take care of some aspects of business that we might not have got to otherwise.
Updating your company's website is one such example. Once we've set up our digital presence, it's all to tempting to simply leave it be. This has the potential to be an enormous mistake, depending on when your website was created. Having an outdated website can signal to your customer's that you're behind-the-times instead of leading the pack.
Having an updated website can also leave your customers vulnerable to data breaches and cybercrime, as your site may not be up to the latest security standards and specifications. The loss of trust in your brand can be much more expensive than any misplaced data or even ransomware, in a worst case example. Once you've lost a customer's trust you run the risk of having lost them for good.
Not only could you lose loyal customers, they might actively campaign against you. Nothing generates negative reviews more quickly than the perception of poor customer service. They might warn others in their network against doing business with you, as well. These are some of the reasons that cybersecurity is an increasingly important priority for CEOs.
Demonstrate Your Social Ethics & Purpose
The personal and the political have never been more closely intertwined. Ethics are increasingly important to consumers as people strive to figure out ways how to live well in this world while doing as little harm as possible. Voting with your wallet has become an established practice of enacting change in the world and society.
How a brand reacts to Coronavirus says a lot about their values and ethics. Forcing non-essential workers to come in and work in person in a hotspot area could be one example of a company not caring about their employees. That can lead to all manner of bad press and negative associations against a company, which can have disastrous consequences.
61% of consumers report that how a brand responds to Coronavirus will have a large impact on whether or not they'll continue to do business with that company once the crisis has passed. When you're creating your marketing budget for 2021, you should allocate funds for demonstrating how your business is responding to COVID-19. You might run a feature on your blog, for instance, showcasing your employees working from home. This will demonstrate your company's conscience, illustrating that you care about your employees, your customers, and your community.
Attract New Customers; Keep Existing Ones Happy
It's a well-established fact that making new customers is much more expensive than holding on to the loyal customers you already have. In fact, it costs 5x as much to make a new customer than it is to retain an existing one. This actually can work to your advantage if you leverage that insight correctly.
Before Coronavirus, 44% of companies focused more on attracting new customers while only 18% prioritized customer retention. While those numbers have likely changed somewhat due to COVID-19, it still gives us a rough idea of where companies' priorities are at.
When you're constructing your marketing plan and budget for 2021, you should allocate funds and resources towards engaging with your existing customer base. The sad fact of the matter is that a lot of businesses will never reopen following the Coronavirus. Customers may get into the habit of assuming their favorite businesses are no longer around. You need to illustrate to your customers that you're still operational, waiting to take care of them and their needs during these hard times.
As part of your marketing strategy for 2021, you should focus some time, money, energy, and resources towards keeping your company in your customers' thoughts. You might consider starting a newsletter, for instance, which gives you the opportunity to go straight to their inbox. These kinds of reminders will keep your brand fresh in their mind, so they'll think of you first when they have a business need.
Finally, you should prioritize some form of inbound marketing strategy if you haven't already. If you have, you should renew your focus on the marketing strategy, as the digital interface is our only opportunity to connect with our customers at the moment. You might consider allocating some funds in your marketing budget for writing a whitepaper or eBook, for instance. You can use these as incentives to help guide your customers through the buyer's cycle, as well.
Inbound marketing was already important before Coronavirus hit. It could be the difference between success and shuttering your business for good.
Being in business is never for the faint of heart. It involves risk and constant evolution, by design. If you create a plan now, you'll be better prepared to cope with whatever life throws at you. There are going to be some big winners and a lot of disgruntled runner-ups in the wake of this global crisis. Start getting your plan together now and ensure your shot at the brass ring.
Looking for Growth-Minded Marketing Support?
Digital marketing may be the single most rapidly evolving industry on the planet. Some things that are just business as usual now seemed like science fiction five years ago. If you really want to succeed and thrive in today's business world, you need to work with a marketing team that truly understands today's business world.
We pride ourselves on staying on top of the latest marketing strategies, tools, and techniques. Whether you're looking for help while budgeting for marketing or want to create a multichannel campaign, we've got the growth tools and strategies for your business to thrive, even during these uncertain times. Contact us today to let us know how we can help bring your business growth goals to life!
