Inflation isn’t just a word economists throw around – it affects how you spend your money. As prices rise, consumers may have to spend more on the same goods and services, which can lead to a decrease in purchasing power. Inflation is driven by supply and demand. When demand is higher than the supply, or the prices increase, consumer spending increases. However, consumer spending in the US has remained resilient despite rising inflation, according to the latest data.
In a recent survey, many people said they were cutting costs in food and beverage, fun/impulse buys, in-person entertainment and leisure travel. This research also says that a strategy people are putting into place to save money is buying things on sale. This has been a common response to rising costs in the past as people are reaching for less-expensive and no-name brands. Online shopping helps with this. You can compare prices, read reviews and find the best deals all with just a few clicks. Marketers need to adapt their strategies in response to this.
As prices rise, consumers will rely on their budget as the primary factor in their purchasing decisions. Brands need to showcase their products’ price and value to bring new customers in and foster existing ones. Here are some ways to show your value without lowering your prices:
Look at where you are in your market and what your competitors are doing. Take note, especially if they are pulling back on their spending dollars. By doing the opposite of what your competitors are doing, investing your dollars while they’re slowing down, you now have the opportunity to own your market.
Utilize Loyalty Programming
Offering exclusive rewards for essential purchases, communicating transparently about economic challenges and providing flexible redemption options helps retain your audience and builds trust. This strategy helps with protecting your audience from competition and decreasing your market share.
Monitor Consumer Behavior
Do your research and stay informed on the recent trends and strategies to make sure your business stays ahead of the curve and can respond to what’s happening to your most influential and important customers.
Don’t Make Rash Decisions if Sales Decline
When sales start to decline, many businesses’ cut the marketing budget. Before pausing your media spend, take a closer look at what’s causing your sales to drop. Consistency and visibility are crucial to your brand. Cutting off the assets that make your brand visible could aid in the decline of your sales.
With no end in sight for inflation, there’s no other choice but to adapt to changing consumer preferences. It’s not easy to do in a challenging economic environment, but with the right tools and strategies, it is achievable.
We know that creating successful campaigns and strategies can be time consuming, so let us do the work for you. At JSK Marketing, we become your strategic partner and extension of your team in creating campaigns that go together with your business’ goals. Don’t let your business fall behind, reach out to us today to get started.