So far 2023 has seen sharp increases in the cost of household bills, rising prices in food and produce and inflation rates hitting a 40 year high. This has, naturally, resulted in consumer spending to reduce in a bid to ride out the storm meaning businesses must now also prepare to navigate through both good times and bad. For businesses the coming months, and possibly, years will mean recession proof planning and budget cuts and executing strategies well will be key to staying ahead of the game.
During times of economic crisis consumer spending inevitably decreases particularly with the current recession seeing an annual increase in the cost of living climb to a 40-year high of 10.1%. This will make it more challenging for businesses to attract and retain customers making strategic planning paramount. According to research carried out by PWC, 86% adults in the UK say they are concerned about day-to-day living costs. This undoubtedly has an impact on consumer spending habits going forward but for businesses that shouldn’t mean giving up on implementing meaningful customer experiences. Afterall, it’s these experience that will ultimately drive the sales and loyalty required to see them through these tough times.
As businesses tighten their purse strings developing cost effective strategies will be vital to weathering the storm going forward. Businesses looking to make the most of their budgets, boost consumer interest in their products, attract and retain customers and increase sales and conversions could find that utilising video as both a business and marketing tool could be the key. According to report by Cisco, in 2022 online videos made up more than 82% of all consumer internet traffic which is 15 times higher than in 2017. This rapidly growing communication tool could be significant if brands want to stay ahead of the competition during this recession.
Being cautious with budgets and planning ahead are crucial but businesses must also consider that maintaining and building on the consumer-brand relationship could be the differentiator between companies who survive the recession and those who don't. In this article we’ll be taking a deeper look at how businesses can navigate the recession and incorporate and utilise video to facilitate business growthOf coO.
The recession and consumer behaviour
The current economic recession means businesses are facing an uncertain future. However, companies can help to increase their online visibility, demonstrate their brand value, and communicate transparently with consumers through the use of video. In recent years online video has become a powerful tool for businesses to connect with customers and increase brand awareness, sales, interactivity and engagement. However, not all videos are created equally in terms of quality and spec, and it's important for businesses to understand the basic principles of online video in order to produce effective content that will resonate with audiences. Effective video content of a professional, high standard delivered in different formats can boost consumer spending and engagement in many ways.
During the last recession in 2008, Millward Brown shared evidence that 60% of the brands who went ‘dark’ saw both brand use and brand image decrease – by 24% and 28% respectively. Video can offer businesses a medium in which to keep their brand alive and in the forefront of target audiences minds. Due to the sheer number of video formats brands can offer outside of showcasing products and services, for example how to content or educational videos, brands can keep themselves firmly in the ‘light’, so to speak.
Developing a clear and compelling message is crucial. Before creating a video businesses should determine the key message they want to communicate and make sure it is clear, concise, and compelling. If they can do this, not only will brands stay firmly in the minds of their intended, they may also see a rise in conversions and sales. Delivering videos across social media platforms and also incorporating them directly on to websites has a multitude of benefits to businesses, one of which is that video has been proven to boost search engine optimisation making the brand more visible to searchers. Not just that, according to studies such as by Eye View Digital, videos on a landing page can increase conversions by up to 86%. Based on statistics there seems to be a solid argument to suggest that incorporating video could be a good move for businesses, recession or not.
Consumer behaviour & the role of video
One key pattern in consumer behaviour during a recession is that people are more likely to forego certain products or services deemed as luxury items. By creating videos that showcase the value of a product or service, businesses can demonstrate to potential customers how their offering is a worthwhile investment and something worthy of its cost. With, ‘nearly three quarters of consumers more likely to purchase a product or service if they can watch a video explaining it beforehand’, it seems businesses would be foolish not to utilise it.
Consumers are also more likely to conduct more in depth research of products and services before making a purchase to ensure their money is being well spent. In fact, 90% of customers report that videos influence them to buy, making video a particularly effective tool as it allows businesses to provide detailed information about their offerings in a visually engaging and interactive way and high-quality branded video content distinguishes successful companies from their competition across industries. If a brand can develop a powerful content strategy like providing its target audience with videos such as tutorials, shareable content or Q&A’s and find a way to reach the desired market, it will soon have a loyal following which will increase the business's visibility, boosting revenue and return on investment.
Additionally, videos that showcase the behind-the-scenes operations of a business allow companies can demonstrate their commitment to quality and transparency. For example, a food manufacturer can create a video that shows how they source their ingredients and how they make their products, which can help to build trust with consumers and increase the likelihood that they will choose that brand over a competitor. Understanding consumer behaviour in times of economic downturn is vital for businesses in creating video strategies that not only engage audiences but sell.
How businesses can incorporate video
Due to the pandemic, the digital space has seen a rise in video platform offerings for businesses. From a range of tools available from video editing, interactive features and customisable options, businesses no longer need to outsource to create video, saving money. These platforms have created a space for all employees in an organisation to create, manage and distribute video content without the need for having professional skills yet able to curate polished branded video content.
Video editors, in particular, are a useful tool during a time of economic downturn as they enable businesses to trim videos and repurpose content, a valuable resource saving tool. Trimmed, short videos can be used in conjunction with social media platforms, and previous material can be recycled which for businesses whose key targets through economic crisis will be to save on time and resources is an important factor. According to research carried out by Statista in 2021, over 4.26 billion people were using social media worldwide, a number projected to increase to almost six billion in 2027. That’s a huge market for businesses to tap into. By diversifying marketing funnels with a larger outreach on digital platforms, businesses will succeed in layering brand messaging which itself is understood to show a 40% improvement on business impact.
Businesses using video across social media accounts to facilitate continued engagement and interest from audiences, while boosting conversions, is a good move. A report from the Content Marketing Institute states that, getting an explainer video on your social channels means viewers are 10x more likely to engage with you and share your video. With video platforms making it easier for businesses to create and share video content, incorporating it into a future strategies could be the key and has the potential to yield great results.
Looking to the future
Video is undoubtedly a powerful tool that businesses can use to increase their online visibility, demonstrate their brand value, and communicate transparently with consumers during a recession. Creating a tailored, honest, and direct video strategy will go some way to establishing trust with consumers, increasing brand sentiment and helping to keep the customer experience front-of-mind throughout the crisis. According to Forrester, a 60 second video is worth equivalent to approximately 1.8 million words of text which, when considering the careful resource planning businesses need to execute during a recession can contribute as a major factor in time, and money saving.
While businesses may find themselves in unchartered territory in the foreseeable future, patterns in consumer behaviour and meeting the needs of consumers through use of video could be key to navigating through. By using video to increase brand awareness, drive sales, build trust, and engage with consumers, brands can set themselves apart from their competition, continue to grow, remain visible to target audiences and attract and retain customers during a recession. With the right strategy and execution, video could help businesses weather the storm and even come out stronger on the other side.
Why not book a demo of our platform today?