Austerity Marketing is marketing to consumers who do not want to spend, such as in an economic downturn. It is the natural behavior of consumers to be a lot more conservative during a recession, but marketers still have a mandate to satisfy the changing needs of the consumers while simultaneously growing their brand profitably.
The biggest myth, however, is that a change in the marketing mix will automatically bring about a change in performance, when the big reality is that there is no direct correlation between one’s marketing mix and sales performance. Marketers must understand the choice architecture of how consumers make buying decisions, both in the consumer market as well as in the business-to-business market.
To be relevant, marketers must be able to answer these questions:
- What are 5 important consumer behaviors you should pay attention to during an economic recession that can drastically change consumer spending habits?
- What are the 6 critical roles of marketing during an economic recession?
- What are 21 proven marketing directions that can stimulate demand during an economic recession?
- What changes in value proposition would you need to counter the negative effects of an economic recession?
- What changes in your marketing mix can counter the negative effect of an economic recession?
- How do you turn an economic recession into an opportunity?
If a marketer cannot answer the six questions above, then it’s time to review the context of marketing, both in a recession, as well as in choice architecture on how marketers can simplify their decision making and help their companies recover revenues, market shares and profit.