How to beat an impeding economic crisis with innovation, not stagnation

Why now is the time to ramp up your organisation’s CRO effort

After everything that has happened over the last two or three years, many of the world’s leading economic pundits are now predicting a worldwide dip in the economy. For many decision makers, these developments mark a need to cut costs, find efficiencies, and batten down the hatches.

This is unsurprising, really. We humans are often highly risk-averse creatures. When faced with uncertainty – as we are now – damage limitation is our go-to. During a recession, consumer behaviour – and, by extension, online behaviour – tends to change in unforeseeable ways.

This might mean that the messaging and imagery on your website that was once highly effective stops appealing to your core users. Likewise, it might mean these elements that were once unappealing become highly effective.

For example, people may be more price sensitive. But this extends far beyond the price of the product you are selling. What would it cost customers to use the product? Can they return it from their home rather than having to drive?

This may all sound very hypothetical, but we have seen this exact thing happen recently. Many websites that were well-optimised before the COVID-19 pandemic saw a big dip in performance soon after the first lockdowns were announced. These performance dips did not go away with time – in many cases, the pandemic completely changed the way consumers were behaving online.

What is more, to diagnose the performance issues, many optimisation teams opted to re-run past winning experiments. What they found was that many experiments that had been strong winners in 2019 had become losers in 2020.

This illustrates the effect that changes in economic, social, and environmental conditions can have on online behaviour – and it highlights the real need for constant adaptation.

But when it comes to the potentiality of being faced with an economic crisis, cutting down on the marketing budget and restructuring the marketing budget judiciously to adjust to the evolving economic uncertainties are two different approaches – with different outcomes. When you go ahead with the latter, it ensures the long-term sustainability of your business.

Then why do businesses decide to compromise on CRO? And how should they strategize instead?

What would happen if business leaders instead chose to continue innovating – or even to ramp up their innovation effort – while their competitors pinched pennies?

During an impeding economic crisis, other expenses take priority, pushing marketing investments to the backseat. Paying employees’ salaries, running operations, adopting new tech stacks, and maintaining important contracts are considered more crucial for business survival.

Also, companies fear that promotions and advertisements around this time can displease customers who are now more likely to control their spending and are watchful of how brands position themselves during economic turbulence.

However, McGraw-Hill research showed that B2B organisations that maintained or increased their marketing budget during the 1981-1982 recession had significantly higher sales during, and for the next three years following, the recession.

Bringing down the average customer acquisition costs becomes a key objective for all businesses during times of economic slowdowns. Marketers must accept the fact that business enquiries and lead-counts will be lower than usual – and maximum effort should go in towards converting the leads that are coming in. In other words, conversion rate optimisation (CRO) needs to take centre stage. This can be done by something as simple as improving the business website, analysing user-behaviour and interactions on site, and doing the necessary website revamps/element changes. When CRO is done right, cost of acquisition falls and the revenue-per-visitor figure goes up.

While it may not be apparent right away, a relative slowdown in business activities offers the perfect scope to do a full-blown website audit. This can include checking the UI/UX of the site, mobile-responsiveness, overall usability, and other related factors. It is important to get data-backed inputs on which pages are getting the most/least engagement, whether cart abandonment is becoming a problem, and what the other probable buyer friction points are. If required, make changes to the brand tonality and communication strategies (competitor research is essential for this).

So – why is optimising for conversion so valuable

There are at least three particularly good reasons why website conversion optimisation deserves a prominent place in every marketing budget:

  1. More leads and more sales: better conversion means more leads and more sales from your existing website visitors. Every pound you spend is working toward earning you more going forward.
  2. Less time and less effort: CRO takes less time and effort than traffic generation or SEO. Which is not to say that these disciplines are unimportant, but since you can get more out of your current traffic by concentrating on CRO, they only enhance each other.
  3. More bang for your buck: For the reasons listed above, CRO makes your marketing spend more worthwhile (because you are converting more visitors to sales leads, and you are doing so efficiently). In an unpredictable economy, every businessperson should be looking for ways to streamline.

To wrap up

A global recession invariably leaves a lasting impact on economies – altering buyer behaviours and preferences. By investing in digital marketing, businesses can gradually be less apprehensive and fearful of the market situation – and be successful in understanding what their target audiences are looking for. Brand positioning and business activities can be modified accordingly. Recessionary trends need not necessarily be all doom-and-gloom – by being proactive and leveraging digital marketing opportunities, companies can still survive, thrive, and stay ahead of competitors.

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