Adjusting your paid marketing campaigns during a recession

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Oct 9, 2020 / by
Adjusting your paid marketing campaigns during a recession

However you might view the current state of the coronavirus pandemic, one thing is assured – it has resulted in the first economic recession in 11 years. In times of recession, businesses naturally suffer and one of the main areas in which they choose to cut back is often marketing.

The logic is that resources would be better spent on more immediate short-term goals, because marketing is, by its very nature, a long game. But there is surely also logic in planning for the future and laying down foundations that will keep the business steady and relevant in an uncertain and unsteady environment.

We have to acknowledge, however, that the word has changed quite dramatically since March 2020 and so whilst marketing efforts shouldn’t be put on the back burner entirely, it might be time to consider a shift in strategy, particularly when it comes to paid search and other paid digital marketing campaigns.

Prioritising and planning

Nobody could have guessed going into 2020 that we’d be living through our current reality. It was almost impossible to plan for COVID-19. But that doesn’t mean we can’t react to it responsibly.

Start by asking yourself what your priorities were back in January 2020 and how COVID-19 and the subsequent recession has shifted those priorities and examining how trends have shifted in the last six months. It’s these changes you should be focusing on, as they are unlikely to change again until coronavirus is brought to heel completely with a vaccine or snuffed out by a series of lockdowns.

Next, ask yourself whether you value sales volume over profit or profit over sales volume because, realistically, you’re not going to be able to focus on both.

Sales

Put the last couple of months under the microscope. As lockdown restrictions were being eased, what have you noticed in your paid marketing KPIs? Make a note of the channels where there have been notable increases and how your ad spend has correlated with the shifts in conversions post-lockdown. The way that these things compare on a year over year basis is probably going to represent the status quo for the foreseeable future.

Now that you have your answers, work out how many sales you want to acquire each week or month going forward and use your cost per conversion and return on ad spend levels to work out how much you’ll need to invest to meet those targets. Of course, what channels you actually choose to invest in will depend on your market, your brand, your existing customer base and your target audience. In any case, don’t be afraid to revise your targets and expectations, because if there’s one thing for certain about 2020 it’s that there are no certainties.

Profits

A focus on profitability means following the same basic process as above but instead of adjusting your spending budgets up to hit a desired sales target, you’ll probably want to cut spend or pause certain campaigns that are not performing. Take those savings and invest them elsewhere or in more secure and reliable channels.

Going this route is all about staying afloat for the immediate future and will most likely result in less revenue but a greater chance at survival. This is the route that should be favoured by smaller businesses that are unsure whether they will still be able to function on the other side of this pandemic if they can’t turn a reliable profit for six months.

Digital marketing during a recession is never going to be an exact science but whether you go after sales or profits will depend on whether your goal is to press ahead or stay afloat. Either way, this current recession should fundamentally change the way you strategise your paid marketing. It’s going to be a tricky road ahead and there is probably going to be a great deal of reforesting in your future but everyone is in this together and who knows, the future might be a little brighter than you think.