Top 3 Ways Inflation Is Affecting your Advertising Dollars

Inflation is happening, and it has a big influence on everything from housing to groceries to digital marketing. As of March 2023, the U.S. inflation rate stands at 6.04%. Because of this, traditional marketing has become more costly for small brands as a result of the materials needed.

Businesses today could go bankrupt due to the cost of printing promotional materials. Also, you might not obtain the conversions you were hoping for. The necessity to switch to more affordable sales channels, such as social media marketing, PPC, and SEO, has been brought on by this reality. Inflation also brings out the issue of unoptimized marketing strategies. Marketing efforts that are not strategic and optimized will not produce the leads, sales, and conversions needed to stay afloat. Keep reading to discover the top three ways inflation is affecting your advertising dollars, and how you can adapt and overcome them in order to come out of 2023 successfully. 


1. User Interest May Decrease Creating Ad Fatigue 

Ad fatigue can be a common issue when it comes to digital advertising, especially during economically uncertain times. When users are repeatedly exposed to the same ads, they can become desensitized to them, leading to a decrease in user interest and engagement.

To combat ad fatigue, it’s important to diversify your advertising efforts. This could involve experimenting with different ad formats, such as video ads, display ads, or social media ads. You can also try targeting different audiences or using different ad platforms to reach new users.

Another strategy is to focus on creating high-quality, engaging ad content. This could involve using eye-catching visuals, compelling copy, or interactive elements to grab users’ attention and keep them engaged.

It’s also important to be mindful of the frequency of your ads. Overexposure to ads can lead to ad fatigue, so it’s important to carefully consider how often you’re showing your ads to users. This could involve adjusting your ad targeting or frequency capping to ensure that users are not being bombarded with too many ads.


2. Consumers Are Prioritizing Purchases 

The depreciation of money is the main problem with inflation. Consumers alter their typical buying patterns as a result of this loss in purchasing power. Most people choose less expensive options, as a result, to make up for this. These may not be the best on the market, but they work. It can also be challenging to market products that don’t solve immediate issues when customers are more focused on essential items due to financial constraints. However, there are a few strategies that you could consider to help your products stand out:

  • Communicate the value: Even if your product is not a necessity, it can still provide value to customers. Highlight the benefits and advantages of your product, and emphasize how it can enhance their lives in meaningful ways.
  • Offer discounts or promotions: You could offer discounts or promotions to incentivize customers to try your product. This could be in the form of a limited-time offer, a bundle deal, or a loyalty program.
  • Improve your branding and packaging: Your branding and packaging can have a significant impact on how customers perceive your products. Make sure that your branding is consistent and reflects the quality and value of your products.
  • Focus on customer experience: Provide excellent customer service and create a positive buying experience for customers. This can help to build loyalty and encourage customers to recommend your products to others.
  • Explore new markets: If your current market is not receptive to your products, consider exploring new markets. Conduct market research to identify potential customer segments that may be interested in your products and tailor your marketing efforts accordingly.

Remember, it’s important to be patient and persistent. Building brand awareness and customer loyalty takes time, but with the right strategies and approach, you can overcome the current economic challenges and succeed in the marketplace.


3. Conversion Rates May Drop 

Blaming low conversion rates solely on website design or copywriting is oversimplifying the issue. Economic factors such as inflation can have a significant impact on consumer behavior and their ability to purchase products or services.

When customers are struggling to make ends meet, they may be less likely to spend money on non-essential items, which can lead to lower conversion rates for businesses. It’s important for businesses to recognize these economic factors and adjust their strategies accordingly.

Ultimately, businesses need to be proactive and adaptable in responding to economic changes and consumer behavior. By staying aware of market trends and adjusting their strategies accordingly, they can overcome lack of interest or fatigue, and continue to attract and retain customers even in challenging economic conditions.


How To Adapt & Come Out Victorious 

We understand that navigating through uncertainty is never enjoyable, but you can never go wrong with an empathetic stance for your consumers, trustworthy internal implementation, and a growth-oriented mindset. Businesses that recovered the fattest from prior recessions typically grew rather than decreased their marketing budgets. By embracing change and adhering to these best practices, you can accelerate your digital marketing growth. Download our free guide to learn how to navigate through financial uncertainty in 2023 with strategic marketing efforts in order to come out victorious.

If you’re looking for an agency partner to help you achieve your goals in 2023 and beyond, then Envision Creative is here for you! We have 22 years (and counting) of experience repositioning brands for increased growth. Our team creates bespoke marketing strategies based on your brand’s challenges and goals so that you can come out ahead in your marketplace. Reach out to our team today and let’s talk about your goals!