Don’t Crunch Your Social Media Marketing!
Can we seriously ask businesses to consider Social Media Marketing in the current economic climate?
Even the government now has to admit that a “cyclical economic downturn” is underway. Or, to put it another way, the world economy, with a few exceptions, appears to be entering recession. Some commentators - the sort who like stealing lollipops from children - are even predicting a depression.
Dr Gary Lilien, Distinguished Research Professor of Management Science in The Smeal College of Business Administration at Pennsylvania State University, has carried out research involving 154 senior marketing executives, to find out why some of them are successful during recessions. Lilien’s evidence suggests that companies will benefit from increasing their marketing spend, providing they’re already marketing (you can’t just start doing it) and have the budget to see it through.
There is plenty of other evidence to support this research. Soap manufacturers pushed their products during World War II. Intel continued to market during the .com slump.
“Athletes often choose times of stress to mount attacks: strong runners and bicycle racers may increase their pace on hills or under other challenging conditions,” the authors write. “In a similar vein, proactive marketing includes both the sensing of the existence of the opportunity (a tough hill and fatigued opponents) and an aggressive response (possessing the necessary strength or nerve) to the opportunity.”
Flourishing Product
Even in recession businesses and consumers continue to spend. Sometimes their choices are surprising. During Japan’s economic crisis in the 90’s the consumption of high end wines increased dramatically. As Mark Ritson of Brand Republic nicely puts it: “If you are on a plane, and the plane is about to crash, you don’t drink piss”. Luxury food brands in the UK are also doing well, as consumers cut back in some areas, but make up for the disappointment by pampering themselves in others. Despite Marks and Spenser’s poor trading results, its food sales are up.
An article from the International Herald Tribune reinforces the suggestion that spending patterns in the economy change. True luxury is being bought in increasing quantities. Most importantly from the IHT article: “Perceptions of affordable versus true luxury may also indicate the future appeal of a brand to the mass affluent when the broader market starts to recover”. The marketing messages during recession will affect perceptions of the business when consumers (and businesses) start to buy again.
So why social media marketing?
Before and after a recession consumers and businesses are consciously changing their buying patterns, reconsidering what they should buy. According to Forrester Research, social programs leverage the voice of the customer to get messages carried further than ad impressions and they motivate consumers in the middle of the funnel. We know that word of mouth and referral marketing is the most popular, powerful and easy to convert - ask any salesperson. It also costs the least. According to Proctor and Gamble, its beinggirl.com web site is four times more effective than advertising. Social media means that new relationships can be formed between brands, businesses and consumers which will outlive the economic downturn. It’s more persuasive than advertising.
There is one caveat: use of social media marketing needs to be carefully planned and measured, something we’ll cover in a future blog. You must have objectives. Social media can be relatively inexpensive, but it’s also easy to blow tens of thousands of Euro on a campaign that misses the point completely.
“Last time around, there was a lot of mindless investment in online,” says Forrester analyst Josh Bernoff. “People were dong it because their competition was doing it or because it looked cool”.
Spending money on social media marketing will reap huge benefits, but only if it’s done wisely.
That’s why specialist companies like 4TM are here to help.
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