Affiliate marketing has staying power that can help you recession proof your business. Read on for helpful insights on how to prepare your business for a recession.
Chances are most everyone is familiar with the famous trope of the eccentric (but harmless, man) walking the streets, carrying a sign that says, “The end is nigh!” Every town has one–and, while his pessimism may be annoying, his perseverance is endearing.
Well, when we say a recession may be coming, we don’t want you to think of us as “that guy with the sign.” In fact, we don’t even want you to take our word for it. No one here at ClickBank would claim to be an economist, so our opinions on what you should or shouldn’t do to financially prepare for any impending doom need to be taken with a grain of salt. And, as an added disclaimer, if you do take our advice… we’re not responsible for any consequences that transpire.
That all being said, sign-man might actually have a point.
The End is… Ambiguous
But as Forbes contributor and Boston Consulting Group partner, Grant Freedland points out in his article, “The Coming Recession: Be Smart When Others are Fearful,” no one actually knows what the economy is going to do.
Freedland write: “Let me make it clear that I, nor anyone else on this planet, knows for sure when the next recession will occur, how deep or long-lasting it will be, or whether it will be global in scope or more locally or regionally contained.”
He goes on to delve into some key factors that set businesses apart during downturns. Read on to find out more.
When/If the Going Gets Tough…
It’s a fact that the global market can be a cornucopia of abundance and also a cruel and unyielding force of destruction. That’s what makes business so alluring. Finding advantages within the limitations of the market makes for a fun and exciting time. Sometimes you win, and… well, sometimes you get pummeled by a recession.
When it comes to economic downturns, some companies don’t make it out alive. Others crawl out missing legs and can’t get back on their feet. Yet, some businesses find opportunity in the face of adversity. These businesses know that, while they may not be able to control the recession, they can control how they respond to multiple scenarios.
Again, Freedland writes: “A third characteristic of companies that grow during downturns is that they map out multiple scenarios, keep their options open, and also strategically invest in those products or services that might help their best customers when they need help the most’ –in other words, help get them through the economic storm.’”
As an entrepreneur, one of the best ways to keep your options open–as Freeland would suggest–is to integrate affiliate marketing into your strategy and focus their attention on things within their realm of control.
The Tough Control the Things They Can
As we’ve already addressed, nobody knows when a recession is coming or what it will look like. Truly, this is something that is out of anyone’s control. Thus, it would make sense that a good way to prepare to venture into a landscape rife with chaos and unforeseeable hardship is to invest in a revenue vehicle that is totally under your control. For the modern entrepreneur, this is affiliate marketing.
Becoming an affiliate marketer requires very little upfront cost in comparison to the earning potential. Affiliate marketing does not require that the affiliate purchase, produce, or store product; nor are they required to ship orders or oversee customer service. With these overhead costs negated, the leg work to get started as an affiliate marketer is reduced and spending control is solely in the hands of the affiliate.
While many companies scale back completely, an affiliate marketer has the freedom to control how and when they pivot their marketing messaging and what products they choose to endorse. With few strings attached to their profit, affiliate marketers are beholden only to themselves and can even prosper and grow in downturns… if they strategize accordingly. Here are a few things you can control and plan for when everything else feels like a room on fire:
Know Your Consumer
Recessions are like rivers. Often uncharted, unpredictable, and—as the saying goes—you can never step in the same one twice. No two economic downturns are identical and, because of this, affiliate marketers need to stay sharp and adaptable. Thus, it’s important to understand how consumers think when the economy slows. Do some research and find out which demographic will be receptive to marketing when a recession hits.
Pinpoint Who’s Spending
John Quelch and Katherine E. Jocz, both contributors to the Harvard Business Review, point out that there are four major segments of consumers during a recession: slam-on-the-brakes consumers, pained-but-patient consumers, comfortably well-off consumers, and live-for-today consumers.
Each of these segments adjusts their buying patterns during a recession. Determining which kind of buyers you stand to lose and which you stand to gain during hard times can help affiliate marketers figure out where to pivot and how to choose what products to promote.
Figure Out What They’re Buying
All segments of consumers sort consumption into four separate categories: essentials, treats, postponables, and expendables.
The “Essentials” category covers things that are necessary for survival such as food, shelter, and clothing. “Treats” refers to items that can be immediately purchased and justified—despite a downturn. “Postponables” are items that don’t need to be bought immediately and “Expendables” are unnecessary purchases that cannot be justified.
In tandem with figuring out who is more likely to buy during a recession, affiliate marketers can up their game by determining what buyers think they need and what they will justify spending money on.
Because affiliate marketers are not under the same restrictions as brick and mortar businesses, or even as online vendors, they have mobility to pivot their messaging, branding, and copy to particular demographics. This allows them to reach a broader range of consumers and market products while considering the evolving buying patterns of those particular consumers.
See the World Through Opportunity-Colored Glasses
And finally, last but not least on this list of suggestions, is this:
If you’re currently an affiliate marketer or if you’re considering becoming an affiliate marketer to recession-proof your business, train your headspace to see an economic downturn as an opportunity to improve your strategic skills and finetune your business approach. It’s not an ideal time for business, but it’s not a time to be wasted either.
With a bit of research, a willingness to learn, and a can-do attitude, affiliate marketers can generate a stream of passive income that can lessen the impact of a recession and fortify their business—no matter what industry they’re in.