Recession Marketing: The Ultimate Guide, Hacks & Examples [2024 Update]

The word Recession strikes fear into consumers and businesses alike, and the first thing everyone thinks to do is slash all budgets and scale back as much as possible.

However, first instincts are not always correct, and for businesses, sometimes scaling back is the wrong thing to do. That’s where recession marketing comes in.

But how does a recession affect consumer buying habits? Why is marketing in a recession so important? And what should you focus your efforts and budget on?

Have no fear; we’ve got your back on this one!

We understand that a recession is a scary time; that’s why we’ve created this article to help you better understand the stats and turn a recession into a tool for success.

We explore everything from consumer behavior, why marketing during a recession is so critical, where your budget should go, and strategies with real-life examples to help you better understand what works and what doesn’t.

Ready to get started?

Let’s jump right in!

How Does a Recession Impact Consumer Behavior?

An economic recession affects everyone, and consumers are no exception, as their jobs become at risk and inflation increases market prices. As a result, most consumers will tighten budgets and reallocate funds to where they are most needed.

In addition, some consumers will prepare for the worst by cutting back on everything except the necessities. In contrast, others will cut back on luxuries but still treat themselves once in a while.

So, one of the most important things to know about your target customers is how and when they are trying to save money. This will help you adjust your budget and marketing plans.

For example, these are some of the things you might expect from the average consumer during a recession:

Bargain-Hunting

No one wants to scale down on their standard of living, even in an economic recession. Therefore, the first thing a consumer will do when money is tight is to look for the best deals and discounts.

Similarly, depending on the household, they may start buying off-brand items or cut some luxuries entirely.

Staying In

Next, customers will cut down on going out as often as they used to. This means staying in and watching a movie on Netflix rather than in a theatre or cooking dinner instead of heading out to a restaurant.

Emotional-Based Purchasing

Tensions are high during a recession, and people are under a lot of stress. As a result, consumers will often seek comfort wherever they can; including in brands they’ve made an emotional connection with.

If you’d like to learn more about how consumer behavior changes in a recession, you should check out this video by survivalofthefastest:

What Effect Does a Recession Have on Marketing?

Consumers typically have less disposable income during a recession, which can lead to a decrease in consumer spending; therefore, marketing can be severely impacted by a recession.

As a result, to adapt to the economic conditions, businesses may need to change their marketing strategies as well as reduce their budgets. For example, they may need to emphasize the value and affordability of their offerings or promote lower-priced or discounted products.

In order to stand out in a crowded marketplace and attract the attention of cost-conscious consumers, businesses may need to be more creative in their marketing efforts.

Another important consideration is that during a recession, competition for consumer dollars can be fierce as businesses compete for a share of the limited spending that occurs.

This can make it harder for businesses to stand out from their competitors and dictate the need to find new and interesting ways to reach customers and keep them interested.

What Should You Do With Your Advertising Budget During a Recession?

Stopping or reducing your marketing efforts during a recession is generally a bad idea. During difficult economic times, marketing can be an effective way to maintain and even increase sales. By continuing to promote and reach out to customers, you can help ensure that your business remains top-of-mind and attracts customers even in a difficult economy.

In addition, it’s important to look at and understand how customers spend their money and where they are trying to cut costs.

What services can your company provide to make customers feel safe during difficult times? What aspects of your marketing strategy could you improve to better meet their needs?

Here are some suggestions for what to do in an economic recession:

• Track how much your clients and customers spend.
• Cut marketing channels that are not producing enough results.
• Refine your marketing budgets rather than cut them.
• Ensure you understand what your competition is doing.
• Explore new ways to market your company in order to connect with current and potential customers.

Why You Should Not Stop Marketing During a Recession

Marketing during a recession can be challenging, but businesses still need to keep marketing even when the economy is struggling. A recession can actually be a good opportunity for businesses to gain market share and outcompete their rivals.

Here are a few reasons why you should not stop marketing during a recession:

• New opportunities for businesses: As some companies may cut back on their marketing efforts or go out of business, businesses that continue to market themselves can gain market share and attract new customers.
• Building trust and credibility with customers: In times of economic uncertainty, customers may be more hesitant to make purchases. By continuing to engage with customers through marketing, businesses can show that they are reliable and trustworthy.
• Staying top-of-mind with customers Even if customers are still waiting to make a purchase, continuing to market to them can help ensure that your business is the first one they think of when they are ready to buy.
• Staying competitive: Even if demand for a business’s products or services decreases during a recession, continuing to market can help the business stay competitive and keep its current customers.

7 Recession Marketing Hacks & Examples

1. Del Monte Foods in 2007 Recession: Branding Is Everything

In order to stand out and attract customers during a recession, businesses must differentiate themselves from their competitors.

This is especially true for businesses in crowded or highly competitive markets where customers have many options. Therefore, businesses can retain existing customers and attract new ones by developing a strong, unique brand that resonates with consumers.

For example, during the recession of 2008, Del Monte Foods changed the way it advertised its products to show how unique its brand was and how fresh and high-quality its products were.

This included increasing their advertising budget and launching a new product line called “Fruit Undressed,” which focused on natural, unprocessed fruits in eye-catching poses.

By doing this, Del Monte Foods was able to differentiate itself from its competitors and create a memorable brand that resonated with consumers.

2. Pizza Hut & Taco Bell in the 1990 Recession: Refine & Design

Consumers are more cautious with their spending during a recession and may be more selective about the products and services they purchase.

This means that companies must be strategic and proactive in order to retain customers and remain competitive. One way to accomplish this is to refine and design high-quality, consumer-friendly products and services.

For example, in response to the 1990 recession, fast food restaurants such as Pizza Hut and Taco Bell introduced new menu items that were tasty, affordable, and in line with changing consumer preferences.

These businesses can attract new customers and retain existing ones by offering a mix of popular favorites and innovative options.

3. Airbnb in the 2007 Recession: Disrupt the Industry

Disrupting an industry means introducing something new and innovative that challenges the status quo and changes the way things are done.

This can be a powerful strategy for businesses looking to gain a competitive edge in a recession, as consumers may be more open to trying new products and services that can help them save money or improve their lives.

By offering something truly unique, businesses can capture the attention of consumers and differentiate themselves from their competitors.

One example of a company that has successfully disrupted its industry is Airbnb, which emerged during the 2008 recession.

By offering a unique and innovative alternative to traditional hotels, Airbnb has been able to capture the attention of consumers and gain a significant foothold in the travel and hospitality industries.

Through its platform, Airbnb has made it easier and more affordable for people to travel and has opened up new opportunities for individuals to earn money by renting out their homes.

By disrupting the industry and offering something truly unique, Airbnb has gained a competitive advantage and has become a household name in the process.

4. River Pools & Spas in the 2007 Recession: Adapt How You Do Things

Adapting how you do things is a crucial strategy for businesses looking to survive and thrive during a recession. Economic downturns can bring about a range of challenges, including declining demand, reduced consumer spending, and increased competition.

In order to stay afloat and continue to serve their customers, businesses need to be flexible and adapt to these changes.

One way to do this is to reassess your business model and look for ways to make your products or services more affordable or accessible to consumers.

For example, River Pools and Spas made pool installations more affordable by using new materials and construction techniques, allowing them to continue to serve their customers and grow their business.

5. Hyundai During the 2007 Recession: Focus on Digital Marketing

Digital marketing refers to the use of digital channels, such as search engines, social media, email, and other websites, to reach and engage with customers.

In a recession, when consumers are spending more time online, it’s important for businesses to have a strong online presence to be able to connect with and reach their target audience.

One way to achieve this is by increasing investment in digital marketing strategies, such as search engine optimization (SEO), pay-per-click (PPC) advertising, social media marketing, and email marketing. This can help businesses to improve their visibility online, attract more traffic to their website, and generate more leads and sales.

For example, in 2008, Hyundai USA increased their online advertising and social media presence to connect with consumers and promote its products during the recession.

This allowed them to reach a larger audience, engage with them on a more personal level, and ultimately drive more traffic and sales to their website.

6. Netflix During the 2001 and 2007 Recession:  Affordability Is Key

Affordability is a key factor for consumers during a recession. As consumers look for ways to save money and stretch their budgets, they are more likely to be attracted to products and services that offer good value for the price.

In other words, affordability is about more than just offering low prices – it’s about providing consumers with the best possible value for their money, at a price point they can afford.

For businesses, this means being strategic about pricing and offering a range of options that cater to different budgets and needs.

For example, Netflix offers a variety of subscription plans at different price points, allowing consumers to choose the option that best fits their budget and needs.

This approach allowed the company to cater to a wider range of consumers and maintain a steady customer base through the 2001 and 2007 recessions.

7. Groupon During the 2007 Recession: Find the Opportunities

Even during a recession, there are opportunities for businesses to grow and thrive. By looking for new markets, expanding into new areas, or offering new products and services, businesses can take advantage of the opportunities presented by a recession and continue to grow.

One example of a company that successfully took advantage of a recession to grow is Groupon.

In 2008, during the global financial crisis, Groupon expanded its business by offering discounts and promotions on products and services to help consumers save money.

This approach allowed the company to reach a larger audience and generate more sales, even during a time of economic uncertainty.

Wrapping Up

In conclusion, marketing during a recession is important for businesses because it can create new opportunities, help build trust and credibility with customers, keep the business top-of-mind with consumers, and maintain competitiveness.

By continuing to engage with customers through marketing, businesses can not only weather the economic downturn but also come out stronger on the other side.

In addition, marketing in a recession is a time-tested strategy that has been used effectively in the past, as evidenced by the examples we’ve covered in this article.

So, if you’re ever worried about what to do in an economic recession, the answer is: Don’t stop marketing!

References

Investopedia: Recession: What Is It and What Causes It?

Washington Post: Consumers kept spending in June even as they remained wary about future

Search Engine Land: What Is SEO – Search Engine Optimization?

Word Stream: What Is PPC? Learn the Basics of Pay-Per-Click Marketing