Economic downturns create uncertainty and changes in user behavior that impact markets and forecasts. They also affect the approach and resources allocated to marketing activities.
Because no two recessions are the same, marketers operate in uncharted waters every time it happens.
This article can help marketers manage SEO campaigns and show the value of their efforts despite a recession.
Doing business during a recession
Consumers will naturally reduce their spending during economic downtimes and establish more stringent priorities.
When sales decline, businesses begin to reduce expenses, lower prices and delay making new investments. Unfortunately, marketing expenditures are often the first to get cut. This approach to cost reduction is ineffective and should be avoided.
Clients often judge SEO and paid search as independent channels. SEO can be seen as “OK to turn off for a bit,” while a brand rests on its laurels on the assumption that the current performance won’t worsen during the downturn.
But SEO isn’t the only channel that may see issues here. In 2009, the entire U.S. ad market saw a decline of 13%. This was predominantly driven by radio and magazines, which saw declines of 22% and 18%, while “online” only declined by 2%.
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The argument for not reducing spending
It might be a good idea to keep costs down when entering a recession. But if you fail to support brands or examine how your core customers’ needs evolve, you will likely jeopardize your medium to longer-term performance.
Organizations and trade bodies such as the Institute of Practitioners in Advertising (IPA) refer to this as losing the “share of mind.” In the United Kingdom, the IPA has publicly advertised warning brands not to reduce marketing spend in the months ahead.
Reading through research papers and thought leadership content from the International Journal of Business and Social Science, Harvard Business Review, and specialists from the Economist and Financial Times, five key marketing objectives for a recession begin to emerge.
These themes are:
- Smarter spending and investment.
- Retention of the existing customer base should be prioritized.
- Leverage your competitor’s weaknesses.
- Monitor the market and adjust spend targeting segments based on their behaviors.
- Maintain your current spending at a minimum, just spend smarter.
How to keep your SEO efforts going during a downturn
The general message is “do not reduce spending.” That’s great.
But when defending our retainer or contract renewal, businesses want to know how their SEO spend will tangibly impact the bottom line.
Let’s apply the learnings to help our clients or employers power through an economic downturn without pausing their SEO efforts.
Review your TAM and messaging
A total addressable market, or TAM, can be defined in several ways.
The most common is to define it as the total number of people who could possibly use a product or service. For example, the TAM for a new smartphone might be the total number of people who own a cell phone.
Despite its limitations, TAM can be a helpful metric for investors to assess a company’s growth potential. Companies with large TAMs can be desirable to investors because they have the potential to generate a lot of revenue.
During a recession, businesses (in B2B) and consumers will react differently depending on their economic stability.
Depending on your TAM, you may need to pivot your messaging and value propositions. This then ties into your SEO strategy. Align activities to these messaging goals, depending on whether your product is deemed essential, luxury, postponable or expendable.
Essential products are often price-sensitive during a downturn. You may want to highlight the value proposition further for less economically stable consumers.
For those in your TAM who are better off, you should continue awareness campaigns (i.e., top and middle of the funnel activities).
By comparison, luxury products can be communicated as being precisely that – a luxury/treat to be consumed as a reward for austerity in other areas. They can also induce dopamine reactions and raise morale.
The other two categories, postponables and expendables are the most difficult to pivot for.
An example of a postponable is a TV streaming service or magazine subscription. Users ahead of postponing may research cheaper alternatives to avoid missing out. During this research phase, you must be visible and fight to retain your existing users.
For other goods that can be postponed (such as servicing a vehicle, replacing a tire, or updating home security systems), messaging should focus on the long-term financial and opportunity costs of not performing these actions now and providing support messaging.
Expendable products and services will likely impact local SEO more than other sectors. Rather than hire a gardener or decorator, consumers will choose to perform the maintenance and upgrades themselves.
This is both an opportunity and a threat to sell to consumers by enabling them or working to remain visible as a company and build trust.
Smarter opportunity analysis and competitor targeting
Most businesses are focused on maintaining and retaining market position during a recession. It’s an excellent time to identify consumers they currently hold and work to leverage them toward your products and services.
Competitive targeting should be a staple of an SEO campaign anyway.
But during a downturn, when sensitivity to price and value is heightened, your messaging and content can focus on pain points that consumers may have with competitor products and services.
Turn these into a competitive advantage to create a conversation with new prospects. You can produce competitor comparison content and highlight the competitor’s weak spots as non-issues or strengths with your product.
For example, if you’re providing a rotating proxy service and you know that your competitor, Bob’s Proxies has issues with uptime, then make sure your content highlights that your service has no such problems.
Positioning for post-recession
SEO is a long-term strategy, but you must focus on the longer-term and the short-term during an economic downturn.
Typically, consumer trust and spending recover within one to two years of a recession. When consumers return to post-downturn spending levels (or establish new market norms), you want to ensure you’re prominent and visible in the vertical.
You can do so by maintaining a certain level of activity toward establishing and maintaining top-of-vertical awareness and remaining competitive for bottom-of-funnel, conversion-focused queries.
During a recession, marketing may seem like more of a challenge than usual. Customers’ spending habits often change, and you may have to go against your instincts.
It’s essential to optimize your budget and be strategic about your priorities. You can continue marketing your products or services while providing for your customers’ needs. A recession can be an opportunity to build customer loyalty.
During a downturn, SEO can alleviate direct cost channels (such as paid) and offer long-term benefits and short-term stability.
Google and the other search engines will continuously update during this period. Competitors who remain stagnant and withdraw resources will suffer in the medium to long-term, costing more in the future to regain lost performance and the opportunity cost of lost visibility.
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