Since 2023, the word recession has been on everyone’s lips. Although we are not currently in a recession, many talk about an economic slowdown, a slump, or even an atypical recession.
Although Quebec’s actual gross domestic product (GDP) saw a very slight increase in the first quarter of 2024, uncertainty has been felt for some time. Indeed, before experiencing a slight improvement, the real GDP declined for three consecutive quarters in 2023.
Inflation and economic uncertainties are prompting businesses to adapt to the current financial gloom and upcoming changes, particularly in communications. Adjusting communication strategies during challenging economic periods is essential to preserving clients, stakeholders and the public’s trust, keeping operations running, and positioning themselves for economic recovery.
Continuing to invest by adopting proactive strategies
The companies that emerge successful from downturns have prepared for and found ways to cope with them.
Even though an economic slowdown comes with revenue losses and changes in consumer habits, a significant reduction in communication and marketing spending can negatively impact a company’s performance and image.
It is crucial for companies to remain proactive and visible to preserve their competitive edge. Competition is fiercer than usual because companies must compete for a customer base that is often smaller or less inclined to spend.
That’s why strategic investments allow companies to stand out by emphasizing their unique qualities. There are no universal strategies—if only it were that simple!
How do we invest effectively in communication? By making intelligent choices, optimizing expenses and processes, better utilizing existing resources, planning targeted actions, using creative methods to generate interest through more refined advertising campaigns and increasing online or community presence.
Experts say maintaining activities, implementing a thoughtful strategy, and long-term planning are significant assets during downturns. Companies that have taken a proactive approach have achieved better results than those that chose to reduce their staff and spending. The former emerge stronger once recovery begins.
Cutting marketing and public relations: is it a good idea?
The economic downturn has recently led to layoffs, and some industries have slashed their marketing budgets. Yet, investing in marketing and public relations remains essential in the current climate.
Rather than eliminating product or service awareness campaigns, they should be adapted to the economic circumstances to better position against competitors. Maintaining a positive image, good visibility, and public engagement are proven strategies during difficult times.
Moreover, maintaining marketing investments allows companies to adapt their messages and targeting strategies to respond better to economic trends and changes in consumer behaviour.
Some companies will focus on promoting products or services that help their target audience overcome the challenges caused by the economic downturn or opt for more effective channels. In contrast, others will revise their commercial propositions to fit their clients’ budget constraints better.
The importance of effective communication
As in regular times, effective communication requires a plan combining clear objectives and a well-defined target audience in these uncertain times.
We know optimal targeting generates a better return on investment, and transparent communication builds and preserves the company’s credibility while solidifying relationships with internal and external stakeholders.
A critical step in developing an effective communication plan is thoroughly assessing the risks and challenges of an economic downturn or recession.
Some strategies for reaching people can be too costly under challenging conditions. That’s why many companies are turning to digital means.
Technology facilitates information transmission and can provide better resource organization. It strengthens online presence and maintains direct contact with clients while fostering engagement and a sense of belonging.
During a downturn, focus mainly on your current clients rather than trying to acquire new ones. Stay attentive to their reactions, questions, requests, and concerns, and use this information to adapt your service offerings and your communications.
Demonstrating empathy and transparency
Stakeholders and employees need reassurance during turbulent times. Difficult periods require an even more empathetic and transparent approach. Expressing compassion generates trust and loyalty and ensures a healthy internal and external climate while reducing the fear caused by the economic context.
Several studies1,2,3 over the past few years have shown that demonstrating empathy is key during economic uncertainty and crises.
Your clients’ concerns and priorities are very different when the economy is thriving compared to sluggish. Make strategic adjustments using the right tone, evaluate your communication efforts and the reactions they generate, and modify your approach if necessary. Highlight your company and clients’ challenges and explain how you can help manage the situation.
Join forces by establishing partnerships or sharing resources. Support the community or small local firms and demonstrate your commitment to social responsibility. Working together is beneficial on all fronts!
If you are interested in economic trends, we invite you to listen to our Quebec podcast episode4 with economist, consultant, author, and speaker Francis Gosselin.
As Francis Gosselin mentioned during his appearance on “C’est COMM ça,” we believe that even during turbulent times, companies can continue to thrive by adapting their practices to the economic situation and adopting transparent and empathetic communications.
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