Global Pandemic, Rising Inflation, and Looming Recession… Oh my!
It’s no wonder that marketers are worried about the future of the economy and how to navigate these new and unknown territories. While it’s nerve-wracking for sure, the past has given us insight into consumer buying trends and behaviors throughout a downturn. While consumption patterns continually evolve on the day-to-day, there are a few tried and true ways we can determine upcoming marketing trends for the remainder of 2022 and beyond, despite the economic climate we are in.
According to the Harvard Business Review, during a recession, most buyers fall into one of four categories:
- Buyers who only get the essentials necessary to live
- Those with income to justify an indulgent purchase
- Those who can put off buying essential or desired items
- And those who will not buy anything that cannot be justified.
During Covid, 20-30% of businesses moved their products online, and we are not going to see this slow down anytime soon. With prolonged exposure to omnichannel shopping and social media marketing spikes, it’s safe to assume that this is the new normal as we march into the years to follow.
So, how exactly do we market to these individuals during a recession, and what can we expect to see from our peers?
A Surge in Brand Equity and Brand Purpose
While having relationships with your consumers isn’t anything new, it will likely become more profound in the latter half of this year and into 2023. By pushing the value of a product and making the people buying these products feel truly respected, it will likely win the customer over into returning and buying again and again – justifying their purchase by the brand culture and the way it aligns with their own views.
Our Director of Strategy, Erin verDorn, stated she believes customer loyalty and customer-centric brands will be critical in the upcoming months. By appealing to the ethos of a customer, we will see more socially charged and empathetic advertising methods as brands try to embrace the lives and social climate of their consumers.
With this, we will see more DNVB (Digitally Native Vertical Brands), move to a wholesale marketing trajectory. Optimizing traffic and sales by utilizing an omnichannel approach will allow brands to increase their YoY revenue and reduce acquisition costs. More options to sell = more visibility to consumers.
“When somebody walks into Nordstrom, Bloomingdales, or Target and they see your product on an end cap or a display, it’s cast in a familiar, positive light. It’s a subconscious thing. That way, when they see an online ad later, everything comes together.”
– Taylor Sicard, co-founder of WIN Brands Group
Social Commerce and Engagement
With social media becoming a prominent source of retail marketing, the continuation of commercial opportunities within the platform will continue to spike. According to Insider Intelligence, 30% of consumers already have purchased an item directly through social media apps such as Facebook, Instagram, or Pinterest. Even if the percentage of social media users who have not purchased anything seems large, it is expected that the percentage of sales through social media marketing efforts will triple by 2025.
However, it is not as simple as JUST advertising. The process in which a purchase can be made needs to be as seamless as possible to encourage a positive experience during the buyer’s journey. Every business that desires to drive consumer traffic and increase revenue, should have a platform where they can build and customize an online store, (we recommend Shopify for all your e-commerce omnichannel needs).
We recently asked our UX and Merchandising Manager, Angela Abbott, for her insights on upcoming e-commerce trends:
“Numerous retailers will rethink their marketing strategies. Instead of panicking and slashing their marketing budgets, many brands will seize this opportunity to increase their investments across multiple channels. With the knowledge retailers gained from the 2008 recession, we know that, despite the anxiety associated with them, recessions create growth opportunities.”
To stay ahead of the curve, it is wise to develop a social media strategy that provides essential content to market your brand on various platforms. After all, the majority of the American population spends their time on their phones scrolling through social media.
Change in e-Commerce Growth Formula and Retention Data
Customer Lifetime Value in regards to Customer Acquisition Costs will pave the way as the ratio of growth. By tracking these metrics, a brand can track the stages of the buyer’s journey and pin-point what triggered it – such as when a product was purchased, the time in which a purchase was made, which advertising campaign it was linked to, and insight into the demographics of the buyer.
By learning the intimate details of a purchase, contacts can then be segmented into categories and nurtured in a way more personal to them (read more about segmentation and why it is important in our other blog, here).
As more and more brands focus on the profitability of their products, the future of e-commerce will begin to shift towards using one universal formula that focuses on visitors, conversion rate, LTV, and variable costs. Alongside the shift in how brands focus on customer-centric marketing, this will also trigger more online shopping purchases.
B2C Content Marketing
It is worth noting that to be successful, your brand needs to offer something that others simply do not. Whether that offering is the product itself or how it is marketed is up to you.
With a range of available resources for marketing, content creators will need to go above and beyond to move buyers down the funnel during marketing campaigns.
Again, this leads back to the customer and their behaviors. Understanding how customers feel when they see your brand is essential. Do they feel that using your product allows a better lifestyle? Does it promote what they want to show off to the world? Align with their own societal and economic standpoint?
If not, it’s time to rethink the way you market your content. We are moving away from the standard model of marketing, and diving into full-funnel marketing.
Turn Your Audience Into Revenue
While not knowing exactly what the future holds for brands is scary, at PCR we are excited for what it may look like.
Need help driving performance and profit while navigating unknown e-commerce territory? We’ve got you covered with a full stack of resources. Help us help you and get in touch today.
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Sources:
- https://hbr.org/2009/04/how-to-market-in-a-downturn-
- https://www.bigcommerce.com/blog/covid-19-ecommerce/#lingering-pandemic-disruptions-to-consumer-behavior-and-supply-chains
- https://www.insiderintelligence.com/content/why-small-businesses-could-benefit-launch-of-facebook-shops
- https://www.statista.com/statistics/1251145/social-commerce-sales-worldwide/
- https://www.youtube.com/watch?v=XnguKt2Rpuc
