Inflation is occurring around the world, with significant impact on everything from groceries to housing — and even digital marketing.

A recent survey by Advertiser Perceptions reveals 1 in 5 marketers has trimmed their marketing budget, and budgets dropped by 16 percent on average. These cuts are most apparent in upper-level funnel channels where brand awareness is the key objective.

In short, the impact on digital marketing during inflation is that some marketers are pulling back on spending or doing more with less, and focusing more efforts on lower-cost, existing customers.

But that doesn’t mean spending less on marketing and advertising is necessarily the best strategy.

Turns out, there can also be a positive impact for marketers even during volatile periods.

Digital Marketing Job Guarantee Program

100% Job Guarantee With Average Pay of INR 5.5 LPAEnroll Now
Digital Marketing Job Guarantee Program

Why Inflation-Driven Panic Can Spell Opportunity for Digital Marketers

In a recent webinar, consultant Gordon Borrell highlighted the increase in small businesses that viewed the current economic situation as poor:

Inflation_Digital_Marketing_1.

Source

Typically, negative sentiments associated with times of “crisis” cause some marketers to decrease their spending — even though consumer spend may be increasing:

Inflation_Digital_Marketing_2

Source

Digital Marketing Specialist Master's Program

Advance Your Career as a Digital MarketerEXPLORE COURSE
Digital Marketing Specialist Master's Program

So, we see that the response doesn’t match the reality, and this is where the inflation we’re experiencing in digital marketing can be an opportunity to scale up.

Here’s why:

  • During the current period of inflation, digital marketers tend to get shy on marketing spend for fear consumers are buying less. Yet we can see by the data that’s not the case, and so this opens more space in an advertising and marketing landscape that now has less competition.
  • Consumers are spending more time on media to get news on what’s happening with the economy, and marketers should be there in those moments with advertising — and they’ll have to spend more to maintain that presence.
  • Less competition, more audience share = greater opportunity

Mr. Burrell also highlighted the types of marketing we see during this period are unique. At the onset of inflation, digital marketers focus on promotions to help them recover what was lost during previous periods (in this case, the pandemic):

Inflation_Digital_Marketing_3.

Source

Marketers can use this opportunity to run limited-time, measurable promotions that increase new customer acquisitions quickly, allowing them to grow their customer database and first-party data, and then enable email marketing to nurture and build loyalty.

Promotions like coupons, rebates, contests, giveaways, and games are just some examples of how digital marketers can take advantage of the inflation period — by spending more, not less — and experience a positive impact.

Conclusion

The inflation being felt worldwide certainly breeds uncertainty, and the impact on digital marketing during inflation is clear in the way some marketers are spending less. Yet the flip side is the inflation period can be one of great opportunity for marketers who have the financial capacity to invest more. Not only is the space less crowded by competitors; it’s also a great time to capture first-party data that’s becoming more critical in a privacy-first marketing era.

Learn all about SEO, Content Marketing, Email-marketing, PPC, and more in our Digital Marketing Specialist course. Start your journey today!

Get More Insights on Digital Marketing

Simplilearn’s Digital Marketing Specialist Master’s Program covers everything you need to know about digital marketing. In this 12-month bootcamp, you will gain expertise in all the discipline of digital marketing, from SEO, social media, content marketing, digital analytics, and much more. Most importantly, you will learn how to generate better quality prospects, drive faster conversions, and generate more revenue — making you an invaluable resource for your organization.

About the Author

Rob SandersRob Sanders

Rob Sanders is a digital marketing veteran with over 20 years of experience. During that time, Rob has helped a wide range of companies utilize new and emerging technologies to increase sales and profitability. As founder of RSO Consulting, Rob helps clients maximize their digital marketing efforts via SEO, SEM, SMO, and Web Analytics. He is responsible for many facets of the web analytics value chain, from identifying business goals and objectives to developing strategies and translating those into Key Performance Indicators (KPIs). Rob also teaches digital marketing and analytics classes throughout the U.S. and abroad. As a contributor for Simplilearn, Rob creates expert thought leadership content on a variety of digital marketing and analytics topics.

View More
  • Disclaimer
  • PMP, PMI, PMBOK, CAPM, PgMP, PfMP, ACP, PBA, RMP, SP, and OPM3 are registered marks of the Project Management Institute, Inc.