Pandemic induced changes will force businesses to re-examine their marketing, product development and sales strategies. 

The financial downturn caused by pandemic has affected the business performance of many companies. Though the impact differs by the industry, companies across sectors have witnessed disruptions in marketing, product development, and sales. To help you survive the recession and thrive afterwards, we reviewed the latest market trends and gathered valuable insights. And despite recessionary, being able to grasp the advantages and disadvantages of the current situation, you can improve your marketing strategy, launch new products, and maximise your sales efficiency. All this will help you position your business for future growth.

Preparing marketing for the upcoming recession

When a company experiences a slowdown of economic activity, cutting costs seems like the natural thing to do. However, reducing marketing expenses isn’t necessarily a good idea. In fact, research shows that organisations should invest in technology and avoid cutting costs in marketing. 

Although attracting new customers can be good for companies looking to grow and expand, retaining the existing audience can sometimes be a better idea, especially when the company operates in a tough economic environment. According to a recent report titled “The ROI from Marketing to Existing Online Customers,” repeat customers bring the most revenue. 

Since many consumers base their purchasing decisions on influencer recommendations, brands should try to embrace the influencer marketing strategy. A recent survey from the insights and consulting firm Kantar reveals that Instagram usage increased 40 per cent during the pandemic. As this social media platform continues to grow in popularity, it’s no surprise that 56 per cent of brands now plan to use it in their future marketing strategies. 

Visions on the future of marketing after recessions

Marketing is a sector that’s continuously changing and the recession has only accelerated some pre-existing trends within the industry. Laura Casselman, CEO of the affiliate marketing platform JVZoo, believes that the e-commerce industry will continue to grow, especially mobile shopping. Smartphones have become an essential part of our lives and our growing dependence on this tech translates into an opportunity for marketers.  

The constantly-rising need for personalisation will encourage brands to adopt AI, says Ishay Tentser, CEO of the software company Initech. According to Tentser, companies will increasingly turn to AI platforms to process data and get valuable insights. The future will also bring higher demands for a human-centred approach. According to Matej Kukucka and Andrej Csizmadia, marketers at the help desk software company LiveAgent, although many organisations are saving money on human resources, consumers still seek human empathy and emotions. 

The future of marketing

Automation, changing customer behaviour, and higher demands for personalisation are just some of the trends we believe will shape the industry in the future. To respond adequately to fast-changing customer expectations, marketers need a new operating model that relies on automation, data, and analytics. If a brand fails, customers won’t hesitate to move on. Immersive technologies such as VR and AR can contribute to businesses’ recovery as well. They allow brands to create a more authentic and memorable customer experience and engage with consumers in completely new ways. For instance, prospective customers can use VR and AR to try on products or services without having to visit the brand’s physical location. 

No matter which technology a company ultimately decides to use, it should always be focused on making consumers feel special. Hyper-targeted marketing allows brands to deliver extremely personalised messages to their consumer base at the right time and place. This particular marketing strategy requires marketers to focus on consumer attributes like age, gender, and occupation, as well as their interests and hobbies. However, to gain a more realistic understanding of consumer behaviour and perception, marketers need to analyse their brain activity and measure how their brain responds to an advertising campaign. Known as neuromarketing, this approach involves taking insights from neuroscience, social psychology, and behavioural economics and using them to improve branding and marketing campaigns.

Since modern-day consumers tend to move between different devices and platforms to access information, brands need to be able to reach them across multiple channels. According to Rakuten Marketing, 45 per cent of chief marketing officers (CMOs) have already begun implementing an omnichannel marketing approach. 

Consequences of crisis on product development

Product development is an important aspect of any company. However, the pandemic has forced many companies to hold back on new product launches. This isn’t necessarily a good thing, though. A 2003 study into recessions, which involved 1,000 businesses from all over the world, suggests that investing in research and development during a recession can have positive economic benefits. Launching new products can help companies capture customers and market share from businesses that have gone bankrupt. In an economic downturn, new products should be developed with a higher purpose in mind. Instead of just generating sales, these products should help companies address a particular issue and solve problems at scale. 

While starting a business during a recession can seem risky, companies like Microsoft and Apple, which were founded in the seventies during a recessionary period, prove this isn’t always the case. But Apple and Microsoft aren’t the only successful firms that got their starts during past recessions. Airbnb, a popular online marketplace for hospitality services, was founded in 2008, a year of the infamous ‘Great Recession’. 

Recessions offer plenty of opportunities for companies to release new products and display their capabilities. However, if the company is disorganised and relies on faulty fundamentals, a recession can damage consumer confidence and eventually kill the business. During the Great Recession, high-end department stores saw their sales fall by 25 per cent, leading to an overabundance of stock. But brands now have more control over their stock and are less dependent on wholesale. 

The coronavirus outbreak has also created a major opportunity for the research and development of new materials for future products. According to Albert Mufarrij, future products will be built from highly innovative and hygienic materials. 

The future of product development

The coronavirus outbreak has significantly disrupted global supply chains, which were already on shaky grounds even before the pandemic. When China locked down entire regions and provinces, companies around the world that rely on Chinese manufacturers for parts and materials were suddenly facing a serious problem. As businesses often don’t have enough options to choose from, most companies today opt for suppliers from China. As a result, the industry is suffering from a major lack of resilience, with companies mostly focused on maintaining the quality of their supply chain relatively constant and lowering costs whenever possible. 

To operate with greater efficiency, companies need to prioritise digitisation and apply digital technology to their business processes. This will not only help them deliver better products and services, but also reduce costs and maximise their market impact. 3D printing, for instance, enables companies to print prototypes and on-demand spare parts locally, which could significantly reduce transportation costs. 

Technology is at the heart of almost everything we do, and leading companies have already started to leverage cutting-edge tech to promote their growth. Take the German tech giant Siemens for example. Siemens has successfully transformed its existing manufacturing processes into a smart factory. Located in a small German town of Amberg, Siemens’ smart facility produces over 12 million products per year. Thanks to innovative tech like the IoT, the productivity is now eight times higher compared to the period before the smart factory transition.

How to prepare sales for an upcoming recession

Recession often catches businesses by surprise and even the best sales teams can fail to respond adequately. As companies put more pressure on their sales teams to close deals, they can easily lose motivation and become stressed. McKinsey & Company advises sales leaders to prioritise taking care of their people and customers. As consumers form new spending habits, sales leaders will also need to adjust their sales operations accordingly. And with the emergence of new digital trends, business-to-business (B2B) sales will look significantly different compared to the period before the pandemic.  

McKinsey’s data also reveals that 90 per cent of B2B sellers have moved to remote selling, with half of the respondents claiming it’s equally or even more effective than traditional sales models. Remote work has fostered the growth of social selling, which involves using social media channels to connect with current and prospective customers.  To launch a successful social selling strategy, sales experts first need to identify the most relevant social media network.  

More importantly, to attract more customers in times of crisis, it’s essential that sales teams adjust their messaging strategy. Unless you want your emails to get buried in consumers’ inboxes, you should avoid using subject lines with COVID-19 or Coronavirus in them. Research suggests this isn’t very effective and can lead to a lower response rate. Cara Felleman, Director of Inside Sales at Resy.com, believes that it’s normal for people to feel worried and scared during a recession, which is why they need empathy and help, rather than hard pitches.

When times get tough, many businesses will base their survival strategy on lowering prices. This can happen when a competitor makes changes to their pricing strategy or when the company reports weak financial performance. Other factors that can impact a seller’s pricing moves include the emergence of disruptive technologies, an increase in the cost of input, and new management.

The future of sales

The sales environment is changing and to better understand consumers and connect with them on an even deeper level, companies need to adopt a new approach to selling and use innovative tools to maximise their sales efficiency. Depending on the company’s strategy, sales teams can use AI-powered chatbots, automated emails, or virtual assistants to communicate with users at scale and turn leads into sales faster. 

Since sales environments are constantly changing, sales teams need to be able to make quick decisions in accordance with the fluctuating market, new customer preferences, and competitor activity. This is why sales are increasingly moving from an intuition-driven to a more data-driven profession.  With the right data-driven sales strategy, companies can save time and energy on finding new prospects and even become up to six per cent more profitable than their competitors. Steve Benson, the founder of the software company Badger Maps, predicts that information, automation, and enablement will become major trends in the future of sales.

Although technology can help automate sales processes, the human touch still matters. As much as 60 per cent of consumers say that they still prefer interacting with a real person in the purchase stage. According to eLearning Industry, technology will play an important role in the future workplace and the development of soft skills will make it easier for people to work alongside their AI-powered colleagues, rather than against them.

Final thoughts

The pandemic has brought fast-moving and unexpected changes to the business world. To stay ahead of the game, companies should plan and execute new strategies, focusing on novel trends in marketing, product development, and sales. Increased consumers’ demand for personalisation should be seen as an indicator as to where to stir their product development, placement, and marketing. In short 一 new products should be developed with a higher purpose in mind. And since people need empathy and help, especially during hard times, companies should adjust their sales strategies accordingly. Intelligent tools are helpful, a kind human touch might do wonders, but the combination of the two might be just what a doctor ordered for the business that’s on the mend.