In 2022, we all are experiencing the emotional and physical results of inflation. Gas prices, electricity bills, home improvements, groceries, clothing prices, and even dog and cat food among many other products, have increased in what we as consumers normally pay. What suffers in our normal lives when we pay higher prices? Consumers spend less time spending frivolously, eating out, making purchases online for items the would like to have, and overall entertainment spending drops. Instead, they we start considering alternatives to our normal products they love to buy because of the lesser cost.
In fact, consumers often consider the alternative to their normal purchases. They may remember an alternative cost, quality, or another characteristic. That consideration may even make it to a conversation with others on what they prefer, where they are influenced by word-of-mouth or network advertising.
Nancy Lan of Starcom told AdNews: "The colliding and concurrent impact of inflation and the increasing cash rate will be an influencing factor on consumers’ purchasing decisions, and as a flow-on effect – advertising, for the rest of the year.
Inflation will force companies to reassess their business and pricing models, and their ability to maintain profitability, with rising costs and their customers re-evaluating what they buy."
Organizations are reassessing their advertising and marketing spend budgets. The average budget used in 2021 will not generate the same CPA, Engagement, and overall performance in 2022. Unfortunately, when in comes to advertising, media spend is a top reason on overall ad performance.
As an alternative, businesses can rely on creating more unique ads that reinforce the brand's message. Examples include:
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