Global Intel Hub -- Charlotte, NC 6/22/2022 - Inflation isn't only in grocery stores and at the pump - it's literally everywhere. Small businesses rely on social media to bring in new business i.e. lead generation. Twitter, Facebook, Linked In, Reddit, and others have replaced social media marketing. Headlines such as "Inflation forces brands to rethink their advertising spending" are popping up more and more, but there isn't an easy solution:
Be it oil, houses, pasta or coffee, the cost of living is going up. Some companies plan to cut their ad spend to push costs down – but is this a wise money-saving measure, or a false economy? Inflation is now running at 30-year highs, forcing companies to either absorb increased costs and reduce their profit margins, or raise their prices. As can be seen from the increase in costs of everyday items, many are opting for the latter, though it’s a risky move for brands when consumer spending is being squeezed. What should marketers do during periods of economic turmoil? Reducing ad spend is an option, though some view this as detrimental over the long-term. Take Unilever, for example. As inflation hit 5.5% in January, the company behind brands like Marmite, Magnum and Dove committed to maintain its €7bn (about £5.8bn) in global advertising spend as it pushes through price rises.
The solution is that companies need to "Step up their Creativity" i.e. optimize your spend. Optimize means to use more efficiently, more targeted, and less wasteful. "Companies are looking for alternative ways to advertise, " says Brett Steinberger CEO of Crediblock.com . "We launched this product we are calling Internet Exposure Boost which is a gateway to optimized internet methodologies."
Inflation is here to stay for the short term, so this will ultimately force companies to re-invent themselves. Even if you have huge pockets to throw at this issue, it still doesn't guarantee a good result. Hyperinflation causes demand destruction, people don't buy products because they are too expensive. That in turn leads to inventory build ups, causing suppliers to offer price cuts to incentivize buyers. This is a potentially toxic situation for sellers, and opens up good opportunities for buyers. If you are a social media buyer, knowing where the bargains are and where to spend your ad dollars is key.
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