Double Down on Your Marketing in a Downturn

When companies prepare financially for an economic downturn, marketing budgets are often first on the chopping block. While it’s important to maximize cost savings during a downturn, it’s also just as crucial to support your strong, established brand and continue honing your knowledge of your target audience. Builders who use a chisel rather than a chainsaw when adjusting their budgets in a recession stand a better chance of keeping and gaining market share.

Here’s why and how to double down in a downturn.

First: Prepare for a downturn

No matter how tough the economy, people still want and need to buy homes. During the worst years of the Great Recession, builders nationwide still sold hundreds of thousands of new homes. Part of preparing for a downturn is meeting a buyer’s needs when times are slow.

Make a plan

Decide the best course of action and have versions for the best- and worst-case scenarios. Identify the plan’s strengths, weaknesses and alternatives before you enact it.

Talk with your team

A downturn can prompt changes both big and small. Talk to your team about what might come down the pike, your plan to address the future and what you need from them. Giving them ownership in some of the decisions can make them less resistant to change and more willing to embrace it.

Revisit operational costs

When’s the last time you looked at your overall budget? A recession is an opportune time to eliminate inefficiencies all around: Look at your staffing structure and items like travel expenses, printing costs and office perks.

Streamline your tech

Cut overhead by consolidating multiple or duplicate platforms, and roll out new technologies that can help your team be more efficient and productive.

Adjust your marketing budget

If you can continue to meet buyers’ changing needs during a recession, you can gain market share. After you’ve identified potential cost savings that still accommodate a healthy marketing budget, you can execute a strategy that allows you to fill the vacuum left by panicked companies that reduce their media presence in response to the recession.

Build up your cash reserves

With reserves in hand, builders can keep their marketing budget intact to maintain brand awareness and leverage opportunities like sponsorships and collaborations that are left open by competitors whose marketing budgets no longer allow them to participate.

Scrub your database

Anytime is a good time to reach out to past buyers — closing anniversaries, birthdays, holidays — but a downturn can provide an excuse to remind them that you’re here to assist with any future housing needs.

Watch and learn

A recession can prompt home buyers to reassess their priorities, revisit their budgets and redefine what value means to them. For example, during the Great Recession, homeowners streamlined their home design along with their finances, prompting many to adopt a minimalist aesthetic. Forward-thinking builders retooled their market appeal and expanded their offerings for multigenerational households and active adult communities.

Understanding the change in buyers’ behavior can help you determine the best way to reach them during a recession and even provide insights about what they might want in a new construction home when the economy begins to recover.

Stick with what’s working now

Take a critical eye to which efforts give you the best ROI and look for opportunities to increase your presence and appeal. Ask yourself:

• Are all of your homes and communities online with up-to-date listings, including descriptions, photos and videos?
• Are you replying to every online lead inquiry within five minutes?

Cut the non-performers

Part of avoiding the knee-jerk reaction of cutting everything during a recession is to cut only the tactics that don’t work. Integrating a marketing attribution model can help you determine what's working. Consider:

• What are the open, click-through and unsubscribe rates on your email campaigns?
• What’s the return rate on your direct mail pieces?
• Which social media platform is getting the best engagement with your audience?
• How many sales center visitors indicate where they heard about you? When did you last evaluate those surveys?

Customize your message and media

Quality and value always resonate with home buyers — especially those weighing a new construction home against an existing home. A recession is an especially opportune time to hone messages on both the immediate and long-term benefits of a new construction home.

Tailoring your marketing along generational lines

Review how different cohorts approach their home-buying journey and reallocate your marketing budget to reflect where and how they’re searching for a home.

A recession can cause buyers to change their traditional behavior and maintain that change even during economic recovery. Understanding the buyer’s changing wants and needs will help you determine the most effective way to adjust your marketing during a downturn.