Are you worried by present uncertainties occasioned by the drop of crude oil prices and the multiplier effect it is having on the Nigerian economy?
Only recently, the media bombarded us with tales of the Nigerian stock market loosing over a trillion Naira. Stakeholders attributed this to the impact of falling crude oil prices, slow pace of governance, lack of policy direction e.t.c
But the reality of it all is that Nigeria is in an economic recession and as an entrepreneur, you are faced with the challenge of sustaining growth and revenue for your business.
if you review the impact of dipping oil prices on many economies over the world, you will notice that it has hampered the development of those economies and Nigeria is no exception, worst still, we are a nation that is almost fully dependent on crude oil revenue. The implications of this mean that investors are losing stock and property owners across Nigeria are suffering losses because of depreciating currencies.
With oil marketers not willing to stabilize crude oil prices, the Nigerian economy is trapped in a plunging trend. The situation it seems is getting worse and it’s accentuated by the fact that the current government’s delay in ministerial appointments has left something of a void as economic policies to guide the economy are not currently defined.
This void has prompted the Central Bank of Nigeria to combine both monetary and fiscal policies to guide the economy to ill effect as the Naira continues to depreciate. No policy implementation from the government means that a lot of business and investors are stalling and activities seem to be at a standstill.
In many ways your business is affected.
I am sure that by now, you should have realized that customers aren’t that willing to spend money as they used to so how do you respond to that? Less customers means less demand for products. What many business do is to cut back on their advertising budgets because people spend less.
The above image shows an analysis of the local advertising expenditures of businesses in the United States over a period of 7 years. During 2009 and 2010, expenditure on advertising was considerably low because of the 2008 global recession.
That shouldn’t discourage you. Research has revealed that companies that actually step up their advertising campaigns during recessions gain competitive advantages over their counterparts. A McGraw-Hill Research study of over 600 Businesses revealed that during the 1981-1982 recession in the United States, business that maintained or increased their ad spend during this time got more sales and grew during the recession and in the following 3 years afterwards.
When other businesses decrease their demand for advertising, advertising becomes cheaper. What this means is that if your business maintains or increases its advertising expenditure, you can acquire a larger market share and reap the rewards of all that at a lower price.
Bottom line is an economic recession presents an opportunity to grow your business. When customers are uncertain where to spend and how to spend their money, a business that advertises itself as reliable and assured can make significant gains.
Those same customers will associate your business with economic staying power and stability. Investors will invest and customers will keep coming back creating a cycle of attachment.
Economic recessions can hit your advertising strategy really hard but there is a solution – digital marketing. Digital marketing is not only a viable solution but it will thrive during recessions like this. The internet has matured now and is essential to your business, here’s why:
Everybody is doing it and if you are not, then you’ll be left behind. Digital marketing expenditure by big companies is expected to increase by 35 percent in 2016. It is always important to strike a balance between outdoor and digital marketing, but new studies reveal that 28 percent of business have in fact reduced their outdoor advertising budgets to fund their digital marketing campaigns
The above graph from BIA Kelsey shows that between 2007 and 2009 more and more businesses are implementing digital marketing strategies.
Money is also an important factor. Digital marketing is typically less expensive (borderline free) than traditional outdoor advertising. One major benefit you can enjoy with digital marketing is that a sizeable, efficient online campaign can be carried out quickly at a cut-rate price.
There are a lot more freedoms you can enjoy with digital marketing that you will not get with outdoor marketing. Newspapers and media outlets have rigid advertising structures which mean that there is less flexibility and cancellations cannot be made.
Digital marketing on the other hand is less rigid and more flexible. You do not necessarily have to commit to specific long term strategies. You can experiment with strategies that work best for you and the discard the ones that do not. Pay per click (PPC) ads can go up and down on a daily basis and even banner ads can be cancelled within 72 hours if you are unsatisfied.
The only aspects of digital marketing that requires long term commitment and consistency are keeping your website and blog up to date, search engine optimization (SEO) and content marketing.
Your business can save money with digital marketing. Businesses who do not utilize digital marketing turn their focus to other areas to increase revenues often through their current customer base either through more frequent purchases or greater ones. Email marketing provides an effective solution to this. You can combine both strategies in one platform by communicating with your customers as well as incentivizing more purchases.
Millions of Naira can be wasted when you advertise to people who have no interest. Digital marketing provides superior targeting capabilities allow you to reach your ideal customers with reduced expenditure. This ensures that your money is only spent on the people who matter.
Behavioral targeting collects information about a user’s web page visits. Re-targeting is an effective strategy that involves advertisements following customers as they browse on the internet. You’re able to get more personal information about your customers than you ever would with outdoor advertising.
A very significant and cost effective advantage that digital marketing provides is tracking and measuring of data. Every mouse click can be tracked and this ensures effective marketing. It also gives you an indication as to which of your strategies are effective. This gives you more freedom to experiment with a wider variety of strategies that you wouldn’t normally use.
Social media marketing is also a very cost effective but mostly free strategy that you can implement that will enable you to reach many more customers. Social media marketing at the entry level is free and you can create multiple accounts on Facebook, Twitter, YouTube and so on.
To use social media effectively, you will need a plan so that you create the most relevant content for the right audience. To get even more out of your social media marketing strategy you can pay small advertising fees to Facebook to help your content reach even more people.
Blogging is also an effective strategy to establish yourself as an authoritative presence on the internet. More importantly it enhances your presence on search engine results therefore exposing you to more people. In fact content creation and management claim the second largest share of digital marketing budgets for many companies today.
The current state of the Nigerian economy is not encouraging. Economic policies are not in effect and it won’t be long before workers will begin demand for raises, prices increase and the general cost of living rises as well.
Your business can still function and survive if you can implement a digital marketing strategy in your business plan. It will enhance your exposure, help you acquire more paying customers but most importantly, it will save you money.
In Post Credits: TheMediaTransformation.com
Featured Image: stocksnap.io