What B2B marketers must know in the face of a potential recession
Talking about a recession isn’t always enjoyable. But it’s a situation that inevitably requires a shift in strategy and mindset to continue finding success in the face of economic headwinds.
Defined technically as a period of a significant decline in economic activity, a recession (and the looming potential for one) directly affects marketing.
In particular, B2B marketers face a unique challenge in identifying a downturn – with sales cycles expanding beyond 6, 12 or more months into the future and lacking evident shifts. Whereas, B2C and D2C marketers can feel it more quickly when complete verticals go south.
In this article, we’ll unpack how a looming recession impacts B2B marketers and the key factors to consider to successfully navigate this landscape.
What did B2B marketers do last time?
You must know the past to understand your present and future. There have been plenty of recessions – some fairly recently.
In 2007–2009, we experienced the Great Recession in which the mortgage crisis led to the collapse of the housing market bubble. While it may have ended for the U.S. in 2009, the ripple effects were felt in some European countries for years.
Countries defaulted on their national debt and had to be bailed out by the European Union, resulting in those countries enacting austerity measures to repay their debts, according to History.
Hindsight is 20/20. And when it comes to learning from past mistakes, there’s a clear connection to be made between:
- Those who increase (or at least maintain) advertising budgets.
- And those who cut or stop marketing efforts altogether.
When faced with a potential downturn, brands that committed to advertising and marketing efforts rebounded faster and recovered quicker than those that opted to pull back.
During the 1990-1991 recession, McDonald’s decreased its advertising and promotion budget, while Pizza Hut and Taco Bell did the complete opposite, according to Pathfind.
This allowed Pizza Hut and Taco Bell to increase sales by 61% and 40%, respectively, while McDonald’s saw 28% fewer sales.
What do B2B buyers want now?
COVID-19 is one key element that differentiates this potential recession from the others.
We just experienced a global pandemic that permanently altered the entire spectrum of consumer and business decisions.
As a result, we will need to navigate key shifts in the B2B buyer behavior and landscape.
Offer personalized experiences
B2B buyers want personalized experiences tailored to their needs, just like when they perform their D2C purchases.
Kibo Commerce provides a few case studies to begin your personalization journey:
- Use tiered pricing to upsell with product recommendations.
- Leverage visual predictive search, prioritize results, and set rules to condition results.
- Enhance the experience for your VIP customers.
Make the move to video
B2B marketers are making the move to video, according to Oracle.
26% claim that a top investment in the coming years will be video editing software, compared to 14% of their B2C counterparts.
Return to in-person events
In-person events are returning, yet budgets for those won’t be drawn from digital advertising, according to an eMarketer study.
MarTech’s Event Participation Index also found that most marketers are optimistic they will be back attending in-person events in 2023.
Engage through digital channels
B2B marketers love to push every lead, no matter what they did on the site, to a sales rep.
Yet, 81% of B2B directors or above prefer digital channels vs. face-to-face interactions, per Forrester’s report.
Get the daily newsletter search marketers rely on.
So, what should B2B marketers do?
Let's talk about the B2B marketing strategies that you should consider during a recession.
B2C will feel it first
Keep a finger on the pulse of B2C industry trends.
If your target audience is retail, have sales started to plummet?
If your focus is higher education, have admissions decreased?
Also, keep in mind some industries tend to fluctuate less, such as healthcare, which isn’t always going to offer up straightforward indicators.
Traditional personas will be less relevant
Traditional marketing personas became less relevant during the 2009 recession, according to a comprehensive Harvard Business Review report on how to market in a downturn market.
This is a key insight.
Psychological segmentation that takes into consideration consumers' emotional reactions will result in a more comprehensive and strategic approach.
Ultimately, the stress of our own day-to-day lives can also impact our decision-making process during difficult times.
Do not stop your marketing efforts
Unfortunately, marketing (and SEO) is almost always considered a "cost" versus a critical component within the pipeline and is subject to being forfeited as a means of saving money.
This shortsighted budget cut can cause serious damage – driving down awareness, slowing the pipeline, and, ultimately, decreasing business health.
Test, test, and keep testing
A recession is a perfect time to do some small A/B tests to iterate as the market fluctuates and ride the wave vs. waiting for no changes in behavior from your audience.
In an economic downturn, we're constantly trying to make our dollars work harder.
This is where marketing technology can help – from streamlining processes to analyzing data faster, embracing technology will keep you nimble and efficient.
Leverage existing customers
Acquiring new customers can be 5 to 25 times more expensive than retaining an existing one, studies suggest.
As a matter of fact, Bain and Company, a management consulting company, performed additional research and found that a 5% increase in customer retention can produce more than a 25% increase in profit.
Enable and empower your clients
When considering B2B retention strategies, you should consider giving clients engaging resources that allow them to solve problems on their own if they pop up.
Stay in touch
It's absolutely vital to keep channels of communication open with your clients. This means requesting ongoing feedback and being proactive about it.
Otherwise, you risk missing key indicators that may tip you off early on to a possible dip in performance or other potential challenges.
Are you going to fall behind?
It's time to prepare. Most strategies discussed in this article will require some level of preparatory effort and planning for them to be successful.
Don't wait for numbers to plummet to start applying some of these strategies.
The post What B2B marketers must know in the face of a potential recession appeared first on Search Engine Land.