Chances are you’ve probably heard economists say the U.S. may be facing a recession.
Of course, that word can be scary. After all, we haven’t had a recession, other than the brief one in 2020, since 2008-09.
Some may have forgotten the economy is cyclical. Recessions come – and they will go.
Recession or Not, Don’t Disappear
What’s important when facing an economic downturn is not to disappear. So while public relations and marketing can sometimes be the first area where B2B companies make cuts, it’s wise to consider not cutting back too much.
What happens when you cut your PR and marketing budget to the bone? Your audiences – customers, prospects, potential employees, investors and the public – may think you’ve disappeared.
You want to ensure they know you’re still there.
“Smart, cost-conscious companies should absolutely, positively not cut the marketing and PR budget right now,” says Frank Strong, founder of Sword and the Script. “Businesses that have (historically) invested in research and messaging – at the precise moment they have an opportunity to communicate with little competition – go quiet.”
During a downturn, there’s less competition and potentially a bigger audience, which feels like the exact time B2B entities should stay the course as far as marketing goes.
So, What If There Is a Recession?
If we do find ourselves in a recession, what should we do? And what can we do now to prepare our businesses?
1) Don’t lead with fear: Recessions cause many to react with fear – but can that make conditions even worse?
“There’s definitely always a large psychological component to the business cycle on the upswing and the downswing. I’m not saying that this is the root cause of recessions, but certainly recessions can be brought on or hastened or worsened by a lot of fear,” says Jim Patterson in this Kiplinger’s article.
And we know that while the economy is cyclical, there are numerous reasons why consumers have been feeling less than optimistic about it as of late.
“People’s mental states never quite recovered to pre-pandemic levels, and starting in April 2021, they began to turn more negative again. Even after we got vaccines and treatments, the vibes only got worse, in large part because of supply chain problems, global instability, the persistence of COVID, and inflation,” says this NPR article.
Recently, the University of Michigan’s gauge of consumer sentiment fell to its lowest level in more than a decade.
John Maynard Keynes, an economist in the 1940s, believed that “fear and pessimism, bad vibes if you will, can become contagious. Investors, business leaders, and consumers can pull back, and that causes a fall in aggregate demand — the total spending on goods and services in an economy. When the economy contracts, Keynes said, it won’t necessarily self-correct and fix itself (as classical economists believed) — and lots of people can lose their jobs as a result.”
If you can avoid overreacting (at least publicly) when economic conditions take a turn for the worse, that can help lessen the blow – or may at least help audiences respond less fearfully.
2) Get ahead of the recession with your messaging: If we know a recession may be on its way, we can prepare by thinking about our messaging. What will our audiences need and want to hear from us as they anticipate an economic downturn?
For example, I have a client who writes thought leadership pieces every few months, so we decided we’d focus his June piece on messaging that related to what they were doing – and what they might suggest others in the industry do – regarding the recession. Here’s the piece in Food Industry Executive, if you want to check it out.
We wanted to capture the CEO’s thoughts at this pivotal moment when many factors impacting decisions about how to invest – and maybe how to pull back – seem to be at play. The client will repurpose this piece and the messaging therein in other content and marketing efforts, as well. It can serve as a foundation for the coming months as we discuss related topics and directions to take.
3) Find the marketing silos that can lead to a duplication of work: Often in marketing, there’s overlap between departments and teams. If you need to make strategic decisions regarding your budget, look for those areas where work is being duplicated.
“On average, 20% of budgets are spent against duplicative efforts because of siloed work,” says AdAge.
“For years, marketers have been conditioned to take a channel-specific view of performance,” the AdAge piece continues. “And siloed channel data has further ingrained this POV. The problem is that this approach creates knowledge and decision gaps between each vertical – gaps that could represent millions in underleveraged spending.”
The article says that applying a more holistic ROI analysis to see what’s truly driving sales can help organizations identify where spending can be cut without impacting growth – and where spending more might have the most significant impact.
4) Take a hard look at what marketing efforts are working – and which are not: When determining where to cut back, you’ll want to carefully examine the elements that aren’t showing results.
As AdAge says, “Once CMOs identify the areas where their marketing dollars are really pulling their weight, they can fine-tune spending to drive more growth. Don’t be afraid of ‘spiky investment’—doubling down on what’s working and really scaling back on what’s not.”
This is sound advice regardless of a recession.
5) It’s good to prepare for the worst – and adjust accordingly if the worst doesn’t happen: Even if a recession befalls the economy, few believe it will be as severe as the one in 2008-09.
We may find ourselves instead in a “good enough” economy.
“When you hear about a recession coming, whether that’s actually going to happen or not, it kind of feels like this steamroller bearing down on you, and maybe you just hope that it doesn’t hit,” says Patterson.
“We think we’re going to slow down under perhaps 2% or around 2% GDP growth, which is not a booming economy. It’s not exciting like what we had in 2021, coming out of the COVID downturn. But that’s a lot better than actually going into a recession.
“And we are staying alert to the possibility that things could slow down more perhaps in 2023,” continues Patterson. “We’ve been telling our readers about some of the warning signs to look out for. If a recession really does appear to be imminent, there are certain indicators that are pretty reliable that tell you that one might be coming. It’s just that right now, we’re not really seeing those clear warning signs going off.”
So, what are the practical ways businesses can prepare?
In addition to PR and marketing considerations, Patterson says you might rethink investments in equipment, real estate or hiring.
“You might want to be more cautious about things that would make you more vulnerable if the economy did really go south and perhaps you had taken on a lot of debt to finance a new investment of some sort.”
Don’t Stop Your Public Relations and Marketing Efforts
Whatever happens, don’t allow your public relations and marketing to come to a full stop. You’ll want to stay out there, even if you change the mix of what you’re doing.
Public relations in a recession can help you remain on your audience’s minds.
Because, recession or not, the economy is cyclical, so staying flexible while remembering that things will turn around at some point is always a wise approach.
Need assistance developing your messaging or getting out there with a thought leadership effort? I work with B2B clients to build effective digital PR programs.
Image credit: https://www.bptrends.com
About the author: You’ll find Michelle Garrett at the intersection of PR, content marketing and social media. As a public relations and communications consultant, Michelle’s articles and advice have been featured in Entrepreneur, Muck Rack, Ragan’s PR Daily, Attorney at Work, Freelancers Union and more. She is the co-host of #PRLunchHour on Twitter Spaces and is the founder and host of #FreelanceChat. In addition, Michelle was named among the top 10 most influential PR professionals by Commetric in 2021 and ranked no. 3 on the PR Measurement Twitter Influencer Index in 2021. She was named one of The Most Influential Tech PR Professionals in the World 2021, and a Top Digital PR Leader in 2020.