{"id":3977,"date":"2022-11-10T01:08:05","date_gmt":"2022-11-10T06:08:05","guid":{"rendered":"https:\/\/advertisingweek.com\/aw360\/2022\/11\/10\/inflation-sure-sucks-but-what-does-that-mean-for-marketers\/"},"modified":"2022-11-10T01:08:05","modified_gmt":"2022-11-10T06:08:05","slug":"inflation-sure-sucks-but-what-does-that-mean-for-marketers","status":"publish","type":"post","link":"https:\/\/advertisingweek.com\/aw360\/news\/inflation-sure-sucks-but-what-does-that-mean-for-marketers\/3977\/","title":{"rendered":"Inflation Sure Sucks. But What Does That Mean for Marketers?"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><em>By Adam Herman, SVP, Business Strategy and Development at Goodway Group<\/em><\/p>\n\n\n\n\n\n<p class=\"wp-block-paragraph\">What do you do when inflation hits a 40-year high, the supply chain continues to worsen with geo-political circumstances, interest rates and the cost of capital are going up, but consumers keep spending and employment looks strong? The question itself is a conundrum! Despite the uncertainty created by these factors, marketers still need to make decisions based on which side has the greater effect on their spending and how ultimately it will affect their bottom line.<\/p>\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Creating a Resilient Marketing Strategy<\/strong><\/h2>\n<p class=\"wp-block-paragraph\">Regardless of what companies are selling and thus what they are marketing, everything is getting more expensive &#8211; from labor and materials, shipping and delivery, and marketing &#8211; and this affects how companies look at and evaluate CAC models and how to best engage with consumers. However, rethinking a brand&#8217;s marketing approach to account for inflation\u2019s impact doesn&#8217;t require a complete strategy overhaul. Instead small changes, customized to meet the overarching business objectives and the needs of the modern consumer, can be made. There are several approaches marketers can adopt to chart a path forward in the face of the larger economic landscape and ensure a brand\u2019s marketing strategy is resilient in the face of uncertainty.<\/p>\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Transparency in Communication <\/strong><\/h2>\n<p class=\"wp-block-paragraph\">Maintaining open and transparent communication with their audiences is one of the most important steps companies can take to combat inflation &#8211; especially for audiences who are navigating inflation for the first time. Effectively communicating both internal and external changes is paramount to sustaining strong relationships with consumers to ensure they do not feel disconnected. For example, brands should make sure to openly communicate price changes, whether it\u2019s a gradual price increase, price freezes, or promotions. Even Amazon has taken the initiative to explain its <a href=\"https:\/\/www.supplychaindive.com\/news\/amazon-announces-first-peak-season-fee-fulfillment-services-fba-holiday-surcharge\/629828\/\">holiday peak fulfillment fee<\/a> to consumers to mitigate the spikes in holiday shipping costs.<\/p>\n\n\n\n\n\n<p class=\"wp-block-paragraph\">Additionally, marketing strategies should focus on product-specific attributes and emphasize the value of goods and services to justify prices. Now is the time to demonstrate consumer-centric thinking and prove to audiences that brands understand both their needs and concerns. Wherever possible, companies should develop pricing and promotional strategies that fit specific target markets and consider how each group approaches and is affected by inflation. This requires brands to reassess their consumer demographics and psychographics to identify pain points.<\/p>\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Approaching With Empathy <\/strong><\/h2>\n<p class=\"wp-block-paragraph\">In a period of inflation, the future can look very uncertain, so it can be beneficial for brands to adapt their messaging to focus on short-term communications and offerings. Companies can show they understand their consumers by switching messaging based on their specific needs. In practice, it means presenting a calming message versus a sense of urgency for consumers who are worried about how they\u2019ll afford necessities. For example, Old Navy recognized that many customers had concerns about shopping for the new school year. To address this, they pivoted their strategy and messaging, announcing a freeze on uniform prices through the back-to-school season to ease financial pressure on families.<\/p>\n\n\n\n\n\n<p class=\"wp-block-paragraph\">Additionally, lower-risk, short-term decisions that keep in mind consumers\u2019 financial concerns could also prove beneficial. Companies can instead offer short-term subscriptions or memberships to appeal to audiences who are not looking to make any long-term investments.<\/p>\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Re-Evaluating and Narrowing Strategies<\/strong><\/h2>\n<p class=\"wp-block-paragraph\">Research has shown that, during inflationary periods, many companies tend to reduce marketing budgets. In fact, following the 2008 recession, U.S. ad spending <a href=\"https:\/\/www.economist.com\/business\/2009\/07\/30\/nothing-to-shout-about\">decreased by 13%<\/a>. Although often seen as a hindrance for marketers, reducing advertising budgets actually presents a huge opportunity for brands to re-evaluate their marketing efforts and create more targeted, purposeful strategies. To do so successfully, companies must thoroughly analyze what strategies or tactics are working, what can be improved, and what efforts no longer provide value and then pivot appropriately. This includes reviewing lead generation costs and using those insights to shift marketing investments toward efforts that generate more effective leads.<\/p>\n\n\n\n\n\n<p class=\"wp-block-paragraph\">While cutting back on marketing costs, brands can look to social media and other marketing strategies to improve and organically grow their brand. How? Focusing on niche markets and reviewing their audience personas. The goal is to bolster their marketing strategies and effectively reach their target audiences through lower-cost channels to create meaningful relationships with consumers for the future.<\/p>\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Looking to the Future<\/strong><\/h2>\n<p class=\"wp-block-paragraph\">Overall, these marketing strategies are short-term solutions that will provide long-term benefits, ultimately driving growth and sales. By remaining vigilant and demonstrating that brands understand their customers\u2019 concerns, companies stand to build meaningful, loyal relationships.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By remaining vigilant and demonstrating that brands understand their customers\u2019 concerns, companies stand to build meaningful, loyal relationships.<\/p>\n","protected":false},"author":7,"featured_media":3978,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","editor_notices":[],"footnotes":""},"categories":[1],"tags":[4],"topics":[2],"class_list":["post-3977","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-culture","topics-editorial"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v28.0 (Yoast SEO v28.0) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Inflation Sure Sucks. 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