4 Commandments for Marketers in Times of Inflation
Inflation is impacting nearly every person and business in the world. As the cost of goods and services increases, so does the importance of working smarter as a marketer. These are truly extraordinary times to be in charge of protecting a brand and expanding its impact.
While making sure your brand thrives despite the economic backdrop will require some visionary planning, it’s far from impossible. We haven’t seen inflation of this caliber since the early 80s, but the good news is that marketers today have the technology, tools, and know-how to come out ahead by making savvy shifts in how their marketing organization spends money and makes decisions to maximize ROI.
Focus on Your Most Valuable Targets
The old adage goes something like, “If you chase two rabbits, you will not catch either one.” In more robust times, it might make sense to define your entire customer universe and develop marketing strategies to reach each segment. In today’s climate, resources are scarce and you can’t exactly afford to chase two rabbits. Decide which one you want, and go get him and all his friends. Profiling your best customers — those who have spent the most money with you and have repeatedly interacted with your brand — can help you find more lookalike clients. Once you find your most valuable targets, focus on them at the expense of every other customer type… at least for now.
Digital platforms with hyper-targeting capabilities allow you to drive performance while cutting costs. The result is a significant return on investment. Focus your budget directly on the 20% to 30% of people who are actively looking for products you sell (and ignore the other 70% to 80%, who would typically represent wasted spend). That’s both massively efficient and effective, driving incremental sales at a much lower cost.
Let Technology End the Guesswork
Let’s assume you’ve found your best customers. Now, how else can you find others like them? Are you still guessing about what they read, how they behave, where they go for information, or how they make decisions? This kind of guess work is no longer an efficient use of your time or dollars. We have the technology to track behaviors and infer motivations that cause your best prospective customers to take action. Make sure you’re using it! For example, Zeta Global worked with Samsung to improve smartphone sales using this approach. They executed a retargeting program built using real-time website activity. Understanding real-time customer engagement allowed them to maximize efficiency, resulting in a 33% increase in return on advertising spend (ROAS) versus Samsung’s classic segmentation.
If it hasn’t happened already, every marketing organization should be transitioning to a modern marketing cloud. Doing so puts a comprehensive suite of digital tools at your disposal. You should be moving your first-party data to customer data platforms (CDPs), which enable your lean organization to act against any available data quickly and measure the results of doing so. It goes without saying that from a waste perspective and an effectiveness-tracking perspective, you should be moving away from analog advertising channels and toward digital channel.
Pivot Based on the Cold Hard Truth Around Inflation
Learning about what your best customers like means also understanding what they don’t respond as well to. This is still great information. Messaging that fails a market test helps us focus on other messaging. The key is to be brave enough to look at the data and pivot quickly without belaboring the mis-fire. A test-and-learn culture will serve you well, as will a marketing team that is empowered to make data-driven decisions that are innovative and well thought out. Last but not least, a data-based approach will help you justify every decision and change to strategy you see fit to make.
Attribution capabilities are no longer “nice to have.” You unequivocally need to be able to accurately measure performance of each channel and optimize your marketing spend today, while future-proofing the business for tomorrow. Connected TV (CTV), for example, is one of digital advertising’s fastest-growing channels. 2022 US CTV ad spending is projected to reach over $19 billion this year—and it affords advertisers measurement capabilities that linear TV could never imagine.
Don’t be Cheap when Confronting Inflation; be Judicious and Strategic
It may go against every bone in your body to not pull back on your marketing budget, but just don’t do it. It’s a self-fulfilling road to failure that doesn’t work. Certainly, it also doesn’t work to throw good money after bad. However, you need to be willing to spend appropriately to fund the right strategies for your business to reach its most important audiences. That includes funding appropriate technology, as well as the expertise required to use it to its full advantage.
Many brands will suffer in periods of protracted inflation. Some will even fail. The best marketers will use this opportunity to go far beyond survival. A strict focus on efficient marketing spend stands the best chance of protecting your brand and propelling your business forward—crisis or not. If you’d like to discover how you can help better target & convert customers during these uncertain times, reach out to a Zeta expert today.