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4 Steps Retailers Can Take to Market Themselves in a Recession

Marketing is often first on the chopping block during a recession, and with GDP contracting two quarters in a row, retail marketers are working hard to determine how to make each dollar go further. Many organizations will cut marketing spend in a bid to preserve margins. But research shows slashing marketing programs can undermine revenue and does not necessarily protect profits.

More optimistic retailers will not pull back on spend and let their competitors steal their customers’ attention. But they will adjust their strategy, taking concrete steps to boost basket size, steal market share and remain top of mind for shoppers.

Those steps include leveraging in-store advertising to maximize potential spend when customers hit stores, investing in brand building that will pay dividends over the long term, boosting trust by crafting communications based on information customers willingly provide (or zero-party data) and offering promotions that show the retailer understands and values who customers are.

Capitalizing on In-Store Advertising

Recessions bring a change in consumer behavior, but they don’t mean customers stop going to stores altogether. Using OOH media and location-based targeting strategies allows retailers to maximize the value of customer floor time to increase basket size and drive revenue. 

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With inflation spiking, consumers are primed to be more cost conscious — and at risk of walking away without making a sale if the price of an item is higher than expected. Crafting in-store advertising with these concerns in mind can lighten the anxiety of comparison shopping for consumers while ensuring retailers aren’t leaving money on the table. Use OOH campaigns and in-store audio media to keep customers informed about ongoing promotions and retailer efforts to support them in a difficult time. 

Taking an omnichannel approach with geotargeted advertising can further enhance the in-store customer experience and drive marginal gains on spending per visit. For example, retailers can use location data to send time-sensitive discounts based on search history or in-site wish lists to consumers’ phones when they enter a store. 

Investing in Long-Term Brand Building

Conventional marketing wisdom encourages focusing on the short term in times of economic uncertainty. Marketers rush to justify budgets by prioritizing lower-funnel tactics that drive easily measurable ROI. 

When rivals go quiet on longer-term tactics, the time is ripe for retailers to make gains in market share by investing in initiatives that resonate with customers in a lasting way, even when they’re buying less. Show customers that you have their needs in mind by developing content that is focused on being helpful and informative, not just boosting your bottom line. When customers are focusing exclusively on promotions, keep connecting with emotional content that drives long-term bonds.

One example of this is Lowe’s DIY-U platform, which offers free, live and on-demand video workshops where viewers can learn practical home improvement skills and get project advice from trained experts. Videos and livestream sessions include opportunities for real-time purchase, but the focal point here is on sharing expertise, not promoting products.

Content that focuses on nurturing connections and building credibility is the key to cultivating a higher quality of awareness that customers will carry to the other side of the downturn. Your rivals will pull back on long-term plays; you should capitalize on them to build long-term ties that will pay dividends after the recession. 

Using Zero-Party Data That Customers Provide Willingly to Craft Trusted Communications

During downturns, consumer trust is especially valuable. Developing a transparent and conversational approach to collecting and using customer information is an effective way for retailers to boost that trust and drive revenue. 

The strength of zero-party data, or information customers willingly and actively provide directly, is that it allows retailers to demonstrate their commitment to customer empowerment while learning how to craft the kinds of communications customers actually want to receive. 

For example, beauty retailer Sephora might use a survey in an email after purchase to inquire about an individual’s specific skincare goals, celebrity or influencer style inspirations, or favorite brands. Retailers can use these details to prompt customers to opt in to future communications, including personalized recommendations and product restock alerts.

Crafting communications around information customers willingly share with retailers can also help boost the value of existing customer lists and loyalty programs. Consumers looking to cut back on unnecessary expenses may be less likely to spring for a new product that catches their eye on their Instagram feed, but if Sephora knows that a customer is looking to cut back, they can target that shopper with repeat purchases or promotions rather than flashy new products. This is how zero-party data transforms into a targeted and rewarding shopping experience.

Offering Targeted Promotions That Show Customers you Care

Periods of recession are notorious for churn: when budgets are tight, brand loyalty weakens as cost becomes a top priority for many consumers. Generic discounts have their place in the marketer’s toolkit, but they can attract fair-weather friends whose loyalty will not outlast the downturn and will dilute the brand. 

Retailers looking to gain and sustain market share in the long term should focus instead ona promotional strategy that identifies and values customers as how they identify themselves and communities they belong to.

For instance, a retailer like Target might use zero-party data to gather information from consumers on their professional identities — like teachers, college students and military veterans. Then they can offer targeted promotions exclusive to a given group — say teachers for back-to-school items. With exclusive, identity-based promotions, customers are recognized for who they are, not just what they buy, cultivating loyalty that will bring returns beyond a downturn. 

Recessions mark a period of uncertainty for both retailers and consumers. But with uncertainty comes neither a guarantee of disaster nor the discounting of possibilities for growth. Retailers that are able to pivot their marketing strategies to drive revenue at the margins, invest in long-term brand building and strengthen loyalty with communities in memorable ways will be positioned to emerge on the other side of the downturn stronger than ever.


Sai Koppala is the CMO at SheerID. Prior to SheerID, Koppala led a variety of marketing and product teams at global software companies like Google and SAP as well as startups like Proximity (acquired by Apple) and Apigee (acquired by Google). Koppala is an Electrical Engineer by training, with an MBA in Marketing from Kellogg School of Management, Northwestern University.

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