Why your crisis Marketing Strategy should be to invest in relationships

Cutting marketing budgets during a crisis seems to intuitively be the right decision. When hit by a downfall, like the COVID-19 pandemic, companies normally optimize their expenses and focus on internal operations, usually cutting growth-focused activities. This is a perfectly reasonable strategy…at first glance.

In fact, a poll conducted by Marketing Week showed that more than half of marketers either delayed, reviewed, or paused their campaigns during the last two months. This means that key activities like content distribution, client engagement, lead nurturing and demand generation are coming to a sudden halt.

Would you ghost your significant other?

Loyal clients are generally the primary source of cash flow for almost any business. Just like any relationship, relationships with your customers need to be maintained constantly. It’s not just a marketing strategy, it’s being human.

What would happen if you suddenly stopped communicating with your significant other? What would your relationship with them look like after 1 day, 1 week, or 1 month of no communication? A company that keeps communicating with its audience is able to project an image of stability, reliability, and care. Needless to say, your brand would have a much easier time retaining customer loyalty and trust. Just like when you put care into nurturing your relationship with your significant other — you grow together.

Usually, kick-starting marketing activities are much more expensive than keeping them going at a steady pace. An IPA (Institute of Practitioners in Advertising, UK) study actually found that when businesses cut their marketing budgets by 50%, it then took them 3 months to catch up to their competitors who didn’t make any reductions whilst the crisis is happening.

When you reduce investment in your customer relationships, others take advantage of that.

During a crisis, marketers and entrepreneurs seem to miss a crucial detail when making decisions on budgets: other companies also put their marketing on hold and it decreases the competition for attention with your customer.

The “noise level” in your niche can drop when competitors cut down on their ad spend. It enables you to effectively reposition your brand, introduce a new product, or gain market share. With lower levels of competition, customer acquisition costs might decrease as well, making it more profitable for you to market your product while your competitors are held back.

When you cut back on ad and marketing spend, your brand loses its “share of mind” with consumers, with the potential of losing current — and possibly future — sales. An increase in “share of voice” typically leads to an increase in “share of market.” An increase in market share results in an increase in profits. How’s that for a marketing strategy?

Don’t be afraid to get emotional

The key to investing in your customer relationships during a crisis is to become adaptive. New customer segments emerge during a recession. Marketers typically segment to demographics (e.g. over 40, new parent, middle income) or lifestyle (e.g. traditionalist, going green). This article from HBR provides a whole new perspective on market segmentation. Instead of the usual approach focused on segmenting by demographics, they suggest a focus on psychological segmentation that takes into account consumers’ emotional reactions to a crisis.

Generally speaking, all consumers typically reevaluate their consumption priorities. By segmenting based on emotion, you can find opportunities in your market, nurture relationships, and focus your efforts on segments that can drive your business today and growth in the future.

Provide Value. Educate. Inspire.

While being in lockdown, people have much more time to spend on the internet, looking for something entertaining, inspiring, and useful. The question is who is going to satisfy this demand: your company’s branded content, your competitor, or some random blogger?

Now is a good time to show thought leadership, educate, and create valuable content for your audience. You need to focus on building long-term relationships with new and existing clients.

Conclusion

A crisis is just a state of change. It’s how you adapt that determines your success. If you are ready to put your client’s benefit as your #1 priority and invest in building and nurturing those relationships, then there will be more customers for you when this is all over.

At Respect Studio, we believe in influencing offline relationships with online conversations. Remember: the best time to show you care is the times of despair.

Learn more about marketing during a crisis, check out our blog: “Marketing Strategy During Crisis: Why Cutting Expenses Can Make It Worse for You”.