“Pivot” is a word that has recently come into the popular business lexicon to herald a need for a shift in strategy in order to maintain a firm’s status quo. The recent tariffs imposed on products and goods produced and imported into the United States has led many ecommerce-based businesses to question their digital marketing initiatives to see how they can control overhead costs. At Active Web Group, our teams of digital marketing professionals are poised to assist our existing clients and to reassure prospects that we are skilled in pivoting online marketing strategies to weather all economic climates. By adjusting your digital marketing budget and other strategies and initiatives, our team can position your business well while we all face current economic challenges.
By definition, tariffs are taxes imposed by one country on goods imported from another country. Essentially, tariffs are trade barriers that raise prices, reduce available quantities of goods and services for U.S. businesses and consumers, and create an economic burden on foreign exporters. Tariffs create downward pressure on both business owners and consumers through two primary channels: increased costs, and a reduction in consumer spending. It is understandable that higher prices force consumers to rethink buying, as their purchasing power has been reduced. When their discretionary spending drops, your firm’s advertising’s return on investment (ROI) falls as well. However, this is not the time to tighten or reduce your digital marketing campaign.
When you cut your online marketing budget or consider pausing campaigns, you greenlight your competitors to steal your market share. That could effectively shutter your company for good. Instead, the AWG team will meet with your stakeholders to determine the best course of action. We will then pivot and make strategic adjustments to your budget allocation for digital marketing. To skillfully navigate a more cautious consumer climate, we will shift our focus and use a more flexible and data-centric approach. Here is an overview:
Digital Marketing Budget and Channel Strategy
- Focus on high-margin products: Consider shifting your ad spend to product lines with better profit margins. This way, your business can absorb higher costs and still deliver a strong ROI.
- Reallocate to high-efficiency channels: Your AWG team will focus on your budget allocation for digital marketing by diverting your spend to channels that will deliver the most measurable and efficient returns. This likely will mean favoring performance-based digital channels, like search, over broad-reach brand campaigns. We can shift focus for the duration of the recession to retain your market share, if not, continue to level up.
- Double down on retention: Acquiring new customers becomes more expensive in a downturn. That is why AWG will focus on initiating cost-effective retention strategies, such as email marketing and loyalty programs, to protect and potentially grow your existing customer base.
Messaging and Creative Digital Marketing Strategy
- Emphasize value, not just price: With your customers more sensitive to price, we will fine tune your messaging. It will be recalibrated to focus on product quality, longevity, and long-term value. Depending on your brand and targeted demographic, it may be a good approach to transparently communicate the reasons behind cost increases/challenges to build/reinforce consumer trust. These actions will contribute to the best use of your digital marketing budget,
- Leverage local sourcing: If at all possible, highlight domestic or local products/services or consider including these in your catalog to appeal to consumers’ sense of economic nationalism and economic stability.
- Communicate price changes transparently: We can show your brand how to use creative messaging to prepare your customers for price increases. For example, the use of tactics such as creating urgency by announcing preemptive sales or a “letter” explaining pricing shifts can be effective. Once the element of surprise is removed, your customers will understand the reasoning behind price increases and not blame your brand by changing allegiance to a competitor.
Let’s Strategize!
The current economic reality has likely impacted your business, and you may be rethinking your company’s budget allocation for digital marketing. Frankly, you need a solid, customized online marketing strategy now more than ever. Active Web Group specializes in supporting businesses like yours. Allow our team to help you weather the recession and be poised for even greater growth when the economy resurges. We invite you to speak with our professionals today to learn how we can help you maximize your digital marketing budget so that every dollar you spend is working for you.
