Economic uncertainty has put a chill on consumer spending. Inflation is cooling but still hovering at 4%, and research shows that 91% of consumers are reducing or changing their spending habits in response to recent economic conditions.
It’s challenging times for media and entertainment companies that want to maintain and grow their subscriber base while also lowering CAC and increasing CLV. But if you build the right marketing strategy, you can set your business up for success, even if the economy winds up slipping into a recession.
Don’t Stop Marketing
As tempting as it might be to take a machete to your marketing budget, don’t. If you cut back too much on marketing—or, even worse, eliminate it entirely—acquiring subscribers might grind to a standstill. Even current users may lose interest in your brand if engagement campaigns halt.
Instead of stopping your marketing efforts, build smart, strategic campaigns. Marketing in a recession is just that: continuing to market during a recession.
5 Ways to Grow Your Subscription Base Now
1. Target Relevant Customer Groups
Your marketing campaigns should be narrowly targeted toward specific groups that are relevant to your brand. For example, a streaming platform could offer students an exclusive discount during final exams and promote it as a way for them to relax and take a much-needed break from studying.
What to Do
Look at your current customer base and decide if there are groups you can engage more effectively or groups you want to reach for the first time. From there, personalize campaigns to these groups.
While there are many ways to segment customers, one of the most effective is by using identity-based attributes such as job, affiliation, or life stage. This technique is called identity marketing. It drives conversions by rewarding customers for belonging to groups they strongly identify with, such as students and teachers. These campaigns often go viral because you forge an emotional connection that encourages loyalty and sharing within their communities.
2. Leverage Your Best Customers to Win New Ones
With customer referrals, you can gain new subscribers with little to no additional financial investment. This is a great way to keep customer acquisition costs low.
What to Do
You can encourage referrals through programs that incentivize sharing with friends. For example, YouTube gives subscribers an opportunity to refer a friend and gives both the subscriber and their friend a discount if the friend signs up.
When you target identity-based segments, those who convert often do some of the work for you. More than 97% of teachers, nurses, and first responders would share an exclusive offer with their colleagues.
3. Support Privacy-Friendly Data Policies
Consumers are increasingly concerned about data privacy, and this is no time to risk alienating customers. In fact, 80% of CMOs say that it’s important to switch from invasive data collection methods to privacy-friendly ones in 2022 and beyond.
What to Do
Invite your customers to share their data with you in exchange for something they value, such as a discount or a more personalized shopping experience. Collecting this kind of zero-party data, where customers only provide the information they want, shows that you take consumer data privacy concerns seriously.
4. Prioritize Customer Loyalty Strategies
It’s critical that you continue both customer acquisition and retention strategies when marketing in a recession. However, remember that acquisition can cost up to 5x more than retention. To maximize the cost-efficiency of your marketing, invest in nurture campaigns designed to stoke loyalty and retention.
What to Do
Inspire greater loyalty by collecting feedback from your customers and taking action in response. Surveys are a great way to engage your customers while also learning more about their preferences. Take their feedback to heart to show you value their opinion.
Nurture greater loyalty by using zero-party data to create more personalized experiences. For example, if you know which of your customers are students, you can provide them with content you know other students have enjoyed. .
5. Make Your Customer Discounts Exclusive
Creating exclusive offers for your key consumer communities is a cost-effective way to drive customer acquisition and increase your active user metrics. By recognizing an important element of your customers’ identities, your offer appears more valuable and you portray a positive brand image.
What to Do
Create gated discounts targeting consumer communities that are relevant to your brand. These could be evergreen or limited time promotions.
To protect your discounts from fraud and ensure the offer really is exclusive, require customers to get verified when they redeem it. The best verification processes will be instant, in-brand, and easy to navigate. Brands such as Hulu, TIDAL, and the Wall Street Journal are among the many media companies that are using exclusive discounts to attract new subscribers.
Build a Marketing Strategy that Will Stand the Test of Time
Just because the economy is experiencing a downturn doesn’t mean your business can’t continue to grow. Learn how SheerID’s Verification Platform and our team of experts can help your business thrive even during uncertain times.