There are several ways in which marketers can turn the prospect of a global economic downturn into competitive advantages, according to the 'Marketing success in a slowdown' report from Experian, which suggests that brands can still create new opportunities for growth even when consumer spending is declining sharply.
In the UK, consumer spending growth is expected to slow to 2.1% in 2008 and only 1.1% in 2009. But the research found that although consumers are, for the first time since the year 2000, more pessimistic about the current and future state of the UK economy than they are optimistic, this is not reflected in their view of their own prospects.
According to Experian, companies that can gain useful customer insights through integrated marketing techniques will benefit from greater agility than their competitors and will be able to more quickly adapt to market changes and provide products, services, and value propositions that are more closely tuned to customer needs and purchasing patterns.
The report explained that 2008 and 2009 will see digital channels playing a pivotal role in customer management and acquisition. However, instead of being used in isolation, the best results will be achieved by integrating digital and traditional offline channels to profitably manage customer portfolios.
Collect insights, not just data
According to Marie Myles, director of marketing consulting at Experian's Integrated Marketing division, "Based on our experience with some of the world's largest consumer brands, the turbulent economy simply means a re-doubling of efforts to derive even more valuable intelligence from every consumer interaction."
The report recommends doing away with simply "collecting interesting information" about consumers, and instead homing in on insights that will enable the brand to create compelling, different, and better propositions that its competitors, with each being personally tailored to each customer at the right time.
Actions for brand growth
The report provides twelve recommendations for new growth opportunities, the first few of which can be briefly summarised as follows:
- Understand customers and their needs
Customer insight needs to be continually revisited to ensure that it is up to date, focusing research investment on this area and not solely on the brand. Marketers need to use this intelligence to create engaging and relevant messages based on a solid understanding of each customer's preferences, needs and behaviours. This will pave the way for true one-to-one communication and enhanced brand loyalty.
- Analyse and segment
Customer profiling, clusters or RFV models are essential to identify which customers are spending the most, how to uplift sales and to detect high value customers that show signs of diminishing value. As new trends emerge, marketers can use this insight to adapt and refine retention marketing techniques on a personalised basis.
- Adapt products and services
It is imperative to assess the environment and for marketers to re-evaluate their propositions. In a changing economic climate brands need to be responsive to evolving buying habits. By taking this approach, marketers will be able to offer a better service to customers, making it harder for competitors to lure them away.
- Integrate channels to increase customer engagement
Customers expect to be contacted through different media. Companies need to understand these media links and weave different online and offline messages to build compelling, engaging and personal experiences. Integrating channels at different stages of the customer buying cycle and customer management programme will drive benefits including a more consistent and persistent message.
The full report has been made available for free download from Experian's web site - click here (free registration required).