How Does the Recession Affect Digital Advertising?

Last updated:
December 30, 2022

When running a business, prudent individuals must stay on top of economic conditions. Our customers have recently gone to us with worries concerning the potential of an oncoming recession and its repercussions on their operations. Generally, in financial decline, budget-slashing happens, with marketing being one of the first areas to suffer. However, at Twelverays, we are experts in digital marketing and suggest that recessions provide an excellent opportunity for further investing in advertising. How does the recession affect publicity, and what can Twelverays and our account reps do to guarantee your investment?

Two Years Filled with Events

During the pandemic, many cut their advertising budgets as face-to-face purchases decreased. Although this made sense for those companies who only spend a few hundred dollars a month on ads, those with larger budgets were making an error by reducing their spending. By stopping to run ads, they lost out on impressions, clicks, and sales, and the chance of assisted conversions and brand promotion further down the line. It is like when someone decides to opt out of investing in a 401k plan; while it may help financially in the short term, in the long run, it will cost them money in terms of interest or something else.

Calculating CPC (Cost Per Click)

Cost-per-click (CPC) is what an advertiser pays when someone clicks on their online ad. The pandemic's peak saw many corporations moving online and investing in Google Ads, which may seem pricey at first glance but can be pretty beneficial. Currently, CPCs are higher than ever in all industries, as Google Ads has become super competitive over the past 18 months, with businesses having to conserve more funds for sales. For example, if a company sets aside $1,000 for CPC and it is, on average, $1 per click, it will get 1,000 clicks from that investment. However, should the average CPC spike to $1.50 and the amount remain unchanged, there will be reduced clicks from that money.

Additionally, PPC is dependent on intent which is one of the reasons why it remains a good option in more challenging times - when some advertisers start depleting their budgets for Google Ads, that results in lower CPC prices. That's where our customers can swoop in and gain market share, which typically takes far longer and costs more money at other times of the year. In the end, long-term clients who kept running their ads observed record-high numbers.

Cutting Away Excess, Staying Efficient

An advertising budget should not be treated as a yes/no decision. The goal is to improve the quality of the advertisements. Twelverays is well-versed in this area. We review search term reports to identify what induces people to visit a website and what does not. By incorporating negative keywords—terms that are connected but have no direct relevance to the product—we can stop ads from appearing on people who probably wouldn't buy anything. On top of that, advertisements can be configured about scheduling, area, devices, and demographics.

Refining your data feed can increase efficiency. For instance, utilizing Twelverays solutions can help add essential information to product names and reduce overusing of keywords.

When running search ads, focus on a strong branded message. Keep your ad copy concise and straightforward to pre-qualify potential customers and minimize waste in Google Ads. Make sure the brand messaging is spot on and communicates what your business offers to potential customers, boosting ad effectiveness.

As the new year starts, a keyword audit is highly recommended. Monitoring how your product offerings vary throughout the year will make it easier to determine which keywords are working. By analyzing web results, you can find out which terms are bringing users to your website and which ones can be eliminated. It'd also be beneficial to remain vigilant in ensuring that the appropriate people see the relevant ads so your budget won't get wasted. On a related note, stretching this budget would also be beneficial.

The Flexible Sales Cycle

Inflation hurts conversions. Consumers are taking a more extended period to make purchases as the sales cycle has become more flexible. Customers can visit multiple sites to search for the best deal before returning to one place and completing their purchase. Clients who cannot expand their budget must use appropriate monitoring platforms to trace customers throughout their sale journey and analyze promotional efficacy. A practical result is attained when we bring in sales from individuals who took weeks to buy: mission accomplished, especially in seasons where it isn't easy. Display campaigns such as static remarketing, dynamic remarketing, and different YouTube options are advocated. They also allow us to incorporate touch points into the customer's journey and aid them in remembering us!

At Twelverays, we track potential customers to inform our optimization of ads and performance. We measure micro-conversions such as time spent on the website and pages viewed.

Excellence in Email Communications

Even though online advertisements are helpful, targeted email marketing is still a dependable and valuable way to interact with customers. During these challenging times of the pandemic and economic recession, emails greatly aid in saving money while balancing other marketing activities. It reaps its benefits from an existing clientele base, thus engaging an audience that might have already shown concern or purchased services previously. When looking at affordability, what makes email so incredibly cost-effective is due to its economics of scale, as it has fixed charges for sending out messages. How email enhances trust in a business can also be seen; before and after a purchase is made, emails play a fundamental role. This motivates customers to make more transactions, increasing their value over time. Furthermore, with emails comes added direct revenue when matching up Google Ads, Microsoft Ads, Meta Ads, and others – making them essential for any operating marketing campaign.

A Perfect Match

To understand how the recession affects advertising and what Twelverays can do to help its customers flourish, we have to look on a case-by-case basis. At Twelverays, we are devoted to locating the appropriate services and tactics that accommodate a business's campaigns in light of a recession, market shifts, performance issues, and more - this could be through PPC advertising, email marketing services, or other approaches. If you want to create an ad plan that can survive economic downturns, talk with your account manager about the abovementioned strategies and any others.

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