With surging costs for goods and increasing talks of a recession, the current state of the economy is forcing companies to take a second look at their marketing strategies in order to prepare for our imminent reality.
During a time when consumers are being more economically conscious, marketing is not optional — it's essential. Instead of eliminating your marketing budget altogether, it's been historically proven that the best way to thrive during a recession is to reallocate marketing spend towards budget-friendly and purpose-driven channels. So what is a thoughtful, effective, and cost-efficient way to market your product or service?
Traditional forms of advertising, such as TV and print, are becoming less reliable (and more expensive). Yet the popularity of influencer marketing has skyrocketed. In fact, the influencer marketing industry is set to grow to approximately $16.4 billion in 2022.
The value of influencer marketing is not limited to its ability to boost brand awareness on social media. On the contrary, influencer marketing can be a channel that provides brands with a plethora of benefits from content creation at scale, community building, and more. Given the uncertainty of the future, it’s necessary to invest in marketing strategies that contribute to a wide range of company goals.
Why Influencer Marketing Should Be Integrated into Your Recession Planning:
Influencers link brands with their communities
To capture the mindshare of consumers, many of whom may be limiting their spending, brands must build authentic relationships with their audiences and deliver value in a variety of ways. We are moving away from a world where capital was the key determinant for success towards a world where authenticity and connection are most valued by consumers. People aren’t just buying products because they saw a commercial or billboard. Instead, they’re buying products that align with their values and express their identity.
According to a recent study by Salsify, 46% of consumers say that they would pay more to purchase from brands they can trust, As a result, brands that are authentic and prioritize genuine relationships with their communities will be the ones that endure a potential recession.
Influencers act as thought starters within their communities and have the ability to foster those 1:1 connections that people crave. By leveraging influencer relationships to build a sense of belonging and community with other like-minded consumers, brands can build and nurture customer relationships and boost customer loyalty — which is more important now than ever.
Influencers create content at scale without a need for a studio
Potential budget cuts have resulted in a continued struggle to produce content as normal. During times of economic hardship, it’s a priority to produce content in cost-efficient ways. Influencers, as well as other members of a brand community, are well-versed in creating high-quality and high-performing content.
Consumers find that content from real consumers impacts their decisions more than more expensive alternatives. A report found that 90% of consumers say authenticity is important when deciding which brands they like and support. Furthermore, 79% of people say UGC highly impacts their purchasing decisions while only 13% said brand produced content is impactful.
Not only does community produced content resonate more with consumers, but for the cost of one in-house photoshoot, brands can generate hundreds of pieces of diverse content by leveraging their community. Plus, with proper content rights, you can even repurpose influencer content across all of your marketing channels, including your own branded social channels, paid ads (including influencer allowlisting), email, website, out-of-home activations — you name it. By doing so, you're able to stretch the impact of the content you already own, lower customer acquisition costs (CAC), and boost your return on ad spend (ROAS).
Influencers provide the social proof that consumers demand
Brand endorsements by celebrities and other high-profile public figures are expensive, and frankly less impactful. When consumers are holding their wallets closer to their chest, recommendations from people they trust hold more weight than ever.
That’s why partnering with niche influencers who are true fans of your brand resonates with consumers and saves your pockets. Multiple studies show that influencers are leading factors in consumers’ purchasing journeys, especially during times when people are reducing compulsive purchases. Social proof and validation from influential brand partners can help brands acquire new customers, retain current ones, and most importantly increase customers’ lifetime value, which isn't just limited to how much a person purchases, but how much they encourage other people to purchase.
How to Get the Most Out of Your Influencer Marketing Budget
So now that you know why you should prioritize influencer marketing during this time, it's important to know how to adjust your influencer marketing strategy in order to adapt to the changes in consumer behavior due to current events.
Expand your sphere of influence
We strongly believe that a person's ability to influence is not based on their follower count, but their genuine passion for your brand. Brands realize there are more people that are influential to their business beyond those with a verified Instagram, and they are building brand communities of like-minded people who share an affinity for their product. Tap into customers, influencers, creatives, ambassadors, affiliates, employees, experts, and more, in order to build out a diverse community of brand enthusiasts. Together, these communities foster a sense of belonging and drive engagement, while building long-term loyalty and advocacy at scale.
Co-create with your community
When influencers are looked at as transactional, one-off relationships, their credibility, effectiveness and cost-efficiency plummets. Instead, treat each relationship with care to create true partners that have the power to provide valuable innovation, product feedback, and more. True co-creation means involving your community in every step of the process. In doing so, you understand what your customers want and are able to create products that suit their needs.
Take a page from the community-focused beauty brand Glossier, for example. The brand has obtained a cult-following due to its philosophy of “democratic beauty” which describes the belief that everyone has a voice when it comes to every aspect of their brand from product development, marketing, and promotion. In 2020, based on requests and feedback from its community members, Glossier launched a new hand cream and donated the first 10,000 tubes to health-care workers on the front-lines of the COVID-10 pandemic. The open dialogue that Glossier has fostered between its brand, community of influencers, and its customers has a direct impact on its massive growth. In fact, word-of-mouth and peer-to-peer recommendations contribute to 80% of Glossier’s growth and sales.
Prioritize trust & loyalty
The relationship between a brand and its customers cannot be purely transactional. Online pet retailer Chewy.com has grown into a $10.2 billion empire built on customer trust and loyalty. Understanding the emotional connection between pet owners and their animals, Chewy.com provides around-the-clock support to ensure shoppers are confident in their purchases. That personal treatment extends beyond the 24/7 hotline to include handwritten notes and holiday cards, delivering comfort and a sense of belonging to turn shoppers into lifelong customers. Chewy.com is well positioned to ride the tides because of its community-first business model, with 70% of sales generated by automatic subscription renewals of pet food and supplies. If you don’t have the bandwidth to engage in these conversations in-house, commission influencers to act on your behalf.
As we look to the next year and beyond, community is what will determine which brands sink or swim in our new reality. The brands that will thrive will be the ones that are determined to understand their customers and meet them where they already are.
Bottom line is that we’re in this together. Investing in people rather than specific channels is what will allow your business to thrive.