Is Your Audience Going Frugal? What You Need To Do Now

Marketing Lesson of The Week

► What To Do When Consumers Get Frugal

For many Americans, summer means a family car trip, whether it’s to a new destination, relatives or weekend home. Americans pack their family and belongings into their cars and head for the open road. When I was a kid, we always took a trip to a different part of New England for two weeks.

Since these trips require one or more fill ups, US consumers become acutely aware of gas prices. Having taken 2 road trips, one in May and one in June, my husband and I were surprised to see the highest gas prices we’ve ever seen in the US.

Due to Russia’s invasion of Ukraine, prices at US gas pumps have been steadily  rising. While the US doesn’t import fuel from Russia, the higher demand for gas from the remaining suppliers has caused prices to increase around the world.

For many Americans, driving is their only transportation option. So an increase in gas costs means they have to reduce costs elsewhere.

► Consumers Feel The Sting Of Rising Prices

As a result, higher gas prices have fueled US consumer concerns regarding inflation. Since consumers act on their beliefs, this increases the chance of consumer-driven inflation. To mitigate inflation concerns, the US government has released some of its strategic gas reserves to reduce prices at the pump. But this aid may be too late to change consumer behavior.

Due to inflation concerns US consumers have changed their shopping behavior. 90% of US customers have noticed price increases especially for gas and groceries, items they buy on a weekly basis.

What does this mean for your business?

• 13 percentage point increase in purchasing of another brand, often a private label.
• 9 percentage point increase in shopping at another lower-priced retailer. This includes wholesale clubs, discount stores and mass market retailers.

These trends hold true for both retail and online shopping. (Source: McKinsey 2022)

► How Do Consumers Respond To Inflation?

While the broader macro-economic environment matters when deciding how your organization should respond to customers’ changing spending habits, understand your buyers’ view of their purchasing options.

This makes direct and more frequent conversations with your customers and end-users even more important than ever.

During bad times, every expense is on the chopping block for your audience, regardless of economic status. As a result, people pay more attention to their bills to see where they can reduce costs.

Why?
Because everyone feels the squeeze on their household budget.

So where do people cut first? They start their frugal journey with nice-to-have items and small indulgences.

• 61% stop or reduce eating out. They also cut or reduce takeout or prepared food;
• 49% cut back on travel and holidays;
• 46% spend less on clothing including repairs and secondhand shopping; and
• 36% cut back on all types of video games.

Other forms of frugality include:

• Substitute homemade for store bought. For example, cook at home instead of eating out, take-away or prepared foods;
• Trade down on expensive options. Buying private labels versus brand name options;
• Shop in bulk to save;
• Use cash over credit cards and other payment options to limit spending; and
• Stretch usable life of products such as clothing and home products. (Source: 2022)

Actionable Marketing Tips

• Talk to customers about the economy. Find out whether your buyers like your products and how they feel about the economy. This activity applies across your organization and must be documented, collated and distributed.
• Assess other ways to package and/or present your offering to make it more attractive to budget-conscious buyers. Your options include changing packaging sizes, locking in sales for a longer period of time at a lower price, and offering DIY options. For example:
• Hedgehog Fibres created Fibre Clubs to lock in 3 month subscriptions for special batches of yarn. Also, they limit the number of subscriptions. So they get paid in advance and only create enough product for subscribers.
• Key point: Know your customer since yarnies will tradeoff going out or on vacation to buy special yarns

Voice Notes

► Can Your Audience Listen To Your Content?

Do you give your audience the option to listen to your content? If not, you may be missing a significant opportunity to expand your audience.

Consumers listen to content in a variety of formats. They include:

• AM/FM radio shows,
• Movies and videos without the image,
• Podcasts,
• Articles read by computer or other device, and
• Voice assistant shows.

One of the best ways to build your brand and distribute your content is to use a targeted podcast. In 2022, 177 million Americans aged 12+ at least tried a podcast. To put that into context, that’s about the number of Americans who used Facebook last year. (Source: Edison Research 2022)

Still think podcasts aren’t worth your marketing time?

Of interest are the devices used to listen to podcasts since this gives marketers information about the context in which their content is consumed.

If you answered voice assistants and smartphones, you’d be wrong. Because podcast listeners also use their computers and cars to listen to content.

Actionable Voice Marketing Tips

• Assess the podcast market to better understand it. As part of your research, start to listen to a few podcasts to understand what people like and dislike about them. Also ask friends and colleagues about whether they listen to podcasts and which ones they like and why.
• Consider whether a podcast would make a good addition to your content marketing offering.

Content Communicates:

► Are Conferences Part Of Your Content Marketing Mix?

In today’s environment where vaccinated and boosted individuals still get breakthrough cases of COVID, many businesses face the question of “To Conference or Not To Conference?”

Conferences are a major part of the marketing and content plans for many businesses. They provide the following benefits:

• Create multiple revenue streams for businesses that host conferences. They include sponsorships (or advertising), attendee fees and virtual replays of the conference
• Allow sales teams to meet prospects and customers IRL.
• Provide speaking opportunities for experts and influencers. Speakers may get paid, do presentations for free or pay to present.
• Offer training and showcase the latest developments.
• Create networking opportunities.

In addition, conferences provide a hook for content creation before, during and after the event.

My favorite example was the ebooks created by Top Rank Marketing for Content Marketing World. Here’s my page in the 2014 edition that is a teaser for my talk and promotes attendance at Content Marketing World. It also stands alone as a big rock piece of content.

Top Rank’s 2014 Content Marketing World e-book

So how do you answer the conference question for your business?
It depends. (I know this is my favorite go-to answer.)

While people want to get out and see other people after 2+ years of COVID, they’re concerned about how safe different environments are. Before every marketing event this year, my Twitter feed was filled with people who couldn’t wait to hug everyone. Marketing speaker Jay Baer posted a photo showing him kissing the floor of his first live speech post-COVID.

The problem:
Not everyone is at the same place in terms of their COVID concerns.

If you’re planning a conference, think about how you can make your event safe for the maximum number of people. This includes the event space, food, drinking, hotels and travel. Also, consider reimbursing people who get COVID before your conference and can’t travel.

Content Entrepreneur Expo (aka: CEX) in Phoenix did a great job of handling a live event in uncertain times. They did the following:

• Planned for a small number of attendees. Their goal was a maximum of 500 people. Being a new event, they used the expo to see who their audience was and what they wanted.
• Required proof of vaccinations from everyone. No exceptions!
• Selected a hotel with special room cleaning for attendees.
• Allowed for spaced out seating for all aspects of the conference including the main stage, breakout rooms and dining.
• Used packaged food to limit health issues.

MAICON, the conference run by the Marketing AI Institute, offered both in-person and virtual options for attendees.

The two challenges when offering the option of in-person or virtual attendance are:

• Attracting enough live attendees to cover the fixed cost of renting conference space. 
• Attendees are sick of virtual events. After being fed a regular diet of free computer-based events, attendees don’t think they should pay for this content.

The upside of offering in-person or virtual attendance for your conference is:

• Sponsors get a better opportunity to talk with attendees. So people aren’t on a scavenger hunt for the best swag.
• Conference creators get to build a tighter community among attendees.

As a result, you build a stronger base for future events with paying sponsors and attendees as long as your business can handle the short-term loss.

Actionable Content Marketing Tips

• Use your conference as a hook to create content before, during and after the event. Create a hashtag and monitor it during the event to spotlight other people’s content. Also, collect user-generated content for future use.
• Record your conference, even if it’s a live-only event. Create a plan to reuse this content for educational materials and future marketing.

Marketing Reads

► Summer time is reading time!

Happy Book Lovers Day! 

Even people who never pick up a book buy at least one book for their summer vacation. In fact, every publisher re-promotes its summer favorites as “beach reads”.

Many schools give their students lists of must-read classics to keep them busy during non-school days.

Lastly, it’s no surprise that airports always have a bookstore to help the last minute traveler faced with a long trip and no entertainment. (Read about Hudson Bookstores in the May 24th issue of the AMG Newsletter.)

For my summer reading, I’m checking the latest books by my colleagues:

• Conversations That Connect by Brooke B. Sellas
• Using Behavioral Science in Marketing by Nancy Harhut
• The Widest Net by Pamela Slim

Also in my reading stack are:

• The Metaverse by Matthew Ball so I can get up-to-speed on this new development.
• The Carbon Almanac. This book includes contributions from 300+ contributors including my friends Diane Osgood and David Meerman Scott. Headed by Seth Godin, this project took less than 6 months to create.

Plan Ahead: Mark Your Calendar