• Bloom Content Team

5 tried-and-tested marketing strategies for startups in a crisis

Entrepreneurs are nature's greatest risk takers, but being at the helm of an early-stage startup looking into the abyss of the next recession requires the steeliest of stomachs.


Fret not, fearless founder.


Before we share our top marketing strategies for UK tech startups, a reminder that today's unicorns like Slack, Uber, Pinterest, Dropbox, Square, and WhatsApp were ALL born in the last great recession.


So, if you've been running for long enough to have even a small client base, and have some cash in the bank or a half-decent runway, here's how to market your startup and come out even stronger than before:


"Stopping advertising to save money is like stopping your watch to save time.” - Henry Ford

We know marketing & advertising is the first area of a business to typically get cut in a downturn, but take a cleaver to marketing budgets will seriously do your company more harm than good.


Research conducted on American business performance over the past century indicated that those companies which don’t reduce, but instead increase their marketing budgets during recessions, actually receive proportionally higher sales than those which lower spend or don’t spend any at all.


By re-strategising and applying a careful scalpel instead, your business will survive the recession and emerge far more profitable than your competitors.


Nurture your existing customers

At Bloom, we talk about the marketing hourglass, as opposed to the more traditional marketing "funnel" that's purely focused on driving conversions.


Of course, working with 70+ startups over the years, we know that customer acquisition is like oxygen for an early-stage tech startup. But so much emphasis is placed on finding new customers that those you've succeeded in converting are often overlooked. There is so much opportunity within an existing customer base - from their loyalty, to referrals and advocacy. (It can cost anywhere between 3 and 10 times to acquire a new customer than to look after an existing one).


The additional benefit to nurturing existing client relationships is to provide a firmer revenue base over the rocky next few months, and emerge with a loyal fan base when the rough times blow over.


Assess your value proposition

Does your offering still meet customer demands? Are your products or services future-proofed for changing consumer behaviours? Are there any freemium models or reward schemes to set up your business for success? How can you adapt now to build your business for tomorrow?


Monzo have perfectly timed the launch of their 'Monzo Flex,' for example.


The new product from the coral-card fintech darling offers the highest level of purchasing flexibility - including the ability to 'buy now, pay later' (a concept popularised by Klarna) and paying in instalments. Ideal for various customer segments looking to spread their debt when cash is tight.

Don't overlook your brand

Implementing a "long and short" strategy that apportions a % of your budget to impactful, direct response marketing (like social advertising), and the rest to longer-term brand-building (like a billboard) is always a sensible strategy.


And it's one you cannot afford to overlook as we head into an economic crisis, either.


“Confronted with a 50% cut in marketing budgets, the smarter play is to actually focus more of it on the longer-term brand-building mission. Performance marketing is going to under-perform in the current market conditions. But this, too, shall pass. Keep the brand light burning, because the cost of snuffing it out and then trying to reignite it next year is gigantic.” - Mark Ritson


Furthermore, the market is even more sensitive to brand messaging during these trying times - take advantage by clearly cementing your position and building share of mind with your audience. Having a brand that stands for something, that authentically communicates its mission, vision, purpose, and values resonates deeply with today's consumer.


Get 256% ahead of your competitors

In a McGraw-Hill study of 600 brands during the 1980s US recessions, those who continued to advertise during the were 256% ahead of their competitors who didn’t.


Not only that, but if you're in a even a slightly stronger position than your competitors and can afford to advertise, then you have a major opportunity to enjoy right now: advertising costs are about to plummet with reduced expenditure.


In layman's terms: the less other businesses are spending to advertise, the less it will cost you! So how can you afford not to?


Think big picture

In a 1989–1991 study by MarketSense, brands like Jif and Kraft Salad Dressing experienced sales growth of 57% and 70% respectively after increasing their advertising during the recession.


Trade short-term profitability for long-term gain, and you will emerge in a list citing your brand alongside the other unicorns born from the 2020s recession.


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If you're an ambitious startup looking to play offensive and take your business to new heights, then get in touch with the UK tech industry's favourite (and award-wining!) marketing agency. Simply book a call directly here or drop us an email.


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Source: https://www.marketingmoves.com/2020/05/marketing-in-a-recession-best-performing-tech-companies-of-the-next-five-years-have-already-increased-their-marketing-budgets/



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