Given the looming recession and the global inflation rate reaching an all-time high, brands are currently under challenging situations. Marketing budgets and ad spending are extremely tight. Keeping up with the times requires marketers to establish trust with value-oriented customers struck by price hikes.
So, what better way than influencer marketing? One of the marketing techniques that can significantly contribute to effective interaction and engagement with the target audience.
"With inflation and recession happening, customers have less money to spend. It is a very tough situation for brands to be in when it comes to selling their products and services. As an agency, we look at a larger marketing mix for our clients, with social media and influencers constituting a large chunk of it," says Amar Jacob, Social and Content Development Director at GroupM Ireland.
Jacob says it is quite a conversation among his clients as they ask him what to do in the current market situation. "Attention economy is what we are living in right now. With the rise of digitalization, we are looking to find attention to our voice against streaming services and social media. The influencers can do so by creating enough attention, views, and engagement, which is the need of the hour.”
Marketers believe that inflation-hit consumers will weigh their options before purchasing and rely more on word-of-mouth marketing.
Dwayne Waite Jr, Marketing Manager at Schell Games, explains why with a "looming recession," brands will need to lean on creators' expertise to relate to customer sentiment. And need to find out how the creator's audience is doing. What information do they rely on the creator to share during this time?
"In times of uncertainty, people look to those they respect and listen to---and in today's society, that's content creators. Understanding that, brands can be more informed in creating marketing campaigns that are salient to their target audience," says Waite.
It's interesting to note that working with the right influencer can help brands connect with communities that are already fans of the products.
Vinnie Potestivo, Emmy award-winning personal media advisor and talent development executive, says, "Communities are comprised of multiple social audiences. Collaborating with social audience influencers provides the opportunity for your message to be heard in their voice and shared on their terms," he says.
For Potestivo, retaining an audience is essential in current times. "Keep your audience engaged by creating opportunities to highlight, elevate, and collaborate with influencers directly from their community. Think big to think small," he says.
Potestivo suggests that brands can make the most of the collaborative opportunities for all-inclusive messaging by promoting evergreen content. "Collaborate with creators who leverage social media to promote evergreen content such as blog articles, podcasts, and newsletters. Creators who utilize multimedia surfaces and provide deeply engaging digital experiences are more likely to push viewers towards conversation,” he says.
Also, choosing a specific type of content and a brand's approach to promoting what's available can be cost-effective. Speaker and Author Neal Schaffer, the founder of the digital marketing consultancy PDCA Social, cites two crucial perspectives on what makes influencer marketing cost-effective.
"Source content from influencers to remain cost-effective during inflation, especially brands can leverage UGC throughout the digital customer journey. Data shows that it will be more effective than using your content," he says.
The second aspect is product gifting. "Many fans - or nano-influencers - would be happy to collaborate just for free products. Influencer gifting is a great and inexpensive way to conduct influencer marketing regardless of the economy," he adds.
Many businesses only have the narrow goal of getting through the current economic crisis. Past research has shown that brands frequently experience slower growth if they adopt a survival strategy involving significant cuts to their marketing budgets and a budget reallocation. Conversely, those who survive the recession by maintaining significant spending are more likely to benefit in the long run.
At a time when budgets are scarce, Potestivo suggests brands need to be creative about delivering their message and who it reaches. "The right balance of digital advertising should incorporate the characteristics of both a brand's target audience and their budget," he says.
While a proportion of the budget can be allocated to ad spending, Jacob points out how brands cannot underestimate social media. "Social media is already a habit, so a brand cannot say they will put their money anywhere. I would be saying 50% of their marketing budgets should go to this form of media," says Jacob, who thinks brands should be agile with how they spend their funds over the year.
Jacob insists on investing in social media platforms like TikTok and YouTube for their long-term benefits. According to him, the two platforms have been giving tough competition to Instagram regarding running influencer campaigns.
"Instagram used to be the center of influencer marketing, and while it is still popular, we are definitely seeing TikTok and YouTube eat away at Instagram's popularity to both engage with a younger generation (TikTok) as well as have content created that has a long shelf life (YouTube)," says Schaffer.
Experts indicate that budget allocation has to shift while abandoning channels providing low ROI. "I think influencer marketing is uniquely positioned to prove valuable during the recession and stay valuable beyond it. Why? Creators can provide that sense of comfort, insight, and honesty that consumers will appreciate in the tough times and the good," says Waite.
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