Fight Economic Uncertainty and Maintain ARR with PR and Marketing
by Cara Sloman, CEO, Force4 Technology Communications
We enter a bear market when stock prices decline by 20% or more from their most recent highs. This can happen for a variety of reasons, such as a financial crisis (such as the collapse of the housing market in 2008) or anxious investors overreacting to some negative economic news. Anxiety about the unknown can make a bear market persist considerably longer than the event that caused it.
In a bear market, volatility is fairly normal; stocks can fluctuate wildly. Investors are often more scared to take risks in this atmosphere because they are even more concerned about losing money.
Companies also worry that they won’t have enough money to advance their business objectives. The temptation is to cut costs, and marketing is usually the first department to suffer. The mindset becomes “Why encourage people to purchase our goods and services if no one is purchasing?” But that kind of thinking might be disastrous. The fact is that marketing’s still crucial—possibly even more so—during uncertain economic times.
Less money is available for businesses and prospective investors during a bear market. If a company’s ARR indicates a decline in growth, investors will probably turn their attention elsewhere. As a result, businesses must maximize their capital to maintain the viability of their operations.
How PR and marketing maintain ARR during a recession
Budget cuts for marketing and public relations are typical in bear markets as a way to “save” money until conditions improve. Even when certain budget cuts are needed, cutting back on your brand recognition initiatives won’t give you a sustainable competitive edge. During recessions, buying cycles lengthen, but efforts to increase visibility and trust will eventually bear fruit. Building and sustaining a company’s presence requires effective PR strategies.
The “retrench” mindset is characterized by an anxious disengagement from key business drivers like marketing. Rapid cost-cutting could have disastrous effects on a company’s ability to succeed in the future. Intelligent businesses know how to perform well in uncertain economic times. Companies that increase their marketing expenditures during difficult times see higher returns and grow their market share as the economy recovers, according to an analysis of the Profit Impact of Marketing Strategies database, which dates back to the beginning of the most recent major recession in 2008.
Here are three strategies businesses can employ to maintain ARR during a market downturn:
- Prioritize customer needs – In order to create outstanding digital experiences and foster loyalty, businesses need to address their customers’ most urgent concerns and challenges. Find strategies to use the proper narrative to appeal to the hearts of prospects.
- Rethink customer experience – Key questions to ask include: Which buyer personas are the best fit? What are they buying right now, and how has that changed? What’s the most economical means of maintaining contact with them throughout the purchasing process? You will have a better grasp of the challenges your customers and prospects are facing as they move through the buyer’s journey if you take the time to consider their needs. Use your data to study their search patterns and come up with solutions for these problems. This knowledge gives you confidence that your marketing strategy will engage customers in a highly tailored way.
- Focus on building relationships – It’s crucial to switch to quantitative relationship-building tactics since sales cycles have gotten lengthier. Use all the resources at your disposal to promote connection. Distribute surveys to consumers (online or offline), publish blog posts or online forums, and ask for feedback through your website and e-newsletters. One-on-one conversations in person, over the phone or via video with customers and prospects further personalize your relationship-building and make them feel uniquely valued. Use the tools of your customer relationship management system to monitor and evaluate your progress.
Resilient businesses can recover from setbacks, evolve and even prosper. From prior recessions, we’ve learned a lot about how to modify our marketing plans to suit the situation. Due to my own experience with two recessions, I know what it takes to not only survive but also thrive.
An attitude of resilience promotes imaginative thinking to increase the brand’s marketing resilience in uncertain times; it’s the antithesis of making snap judgments out of fear. In the end, those who continued their marketing investments during economic downturns will flourish.
The agility to succeed
Marketers that use the resilience strategy can convert what other people might perceive as overwhelming challenges into branding successes by viewing change as a chance to innovate rather than retreat. “In the heart of crisis lies immense opportunity,” Albert Einstein once said.
After a market change, some companies will win and others will lose. Those who persevered in the face of uncertainty will emerge as winners. To comprehend and carry out those PR initiatives that assist them in sustaining their ARR, businesses need to have a flexible and forward-thinking approach. Use the methodology outlined above to do that.