How many people do you know of that have lost their job during COVID-19? During the COVID-19 pandemic, the unemployment rate in the U.S. has reached the highest it has been since the Great Depression. While writing this, 21 million people in the United States are unemployed, and with so many people out of work, reaching the portion of your brand’s audience who are still in a position to spend money on your product with your marketing is more crucial than ever.
The key to surviving this pandemic lies in being able to identify where viable customers are, and then to reach those customers online. Fortunately, there are tactics you can use to reach the people out there that are still earning money and are looking to spend that money on your business.
Keep reading for our tips on targeting the right customers through marketing during COVID-19.
Targeting Customers During COVID-19: Determine Who Is Willing to Spend
How can you determine which of your customers are still able to spend money on your products or services? Research by the Harvard Business Review has grouped consumers into four main groups during times of a recession: ”Slam on the Brakes,” “Pained but Patient,” “Comfortably Well Off,” and “Live for Today.” By understanding the demographics of each group, you can be better prepared and informed of who you should be marketing to right now.
Customers Not Spending During COVID-19: Slam on the Brakes
The “Slam on the Brakes” group is the one that is feeling most vulnerable and is the hardest hit financially. This group will reduce spending by eliminating, postponing, decreasing, or substituting purchases, and though it’s typically made up of lower-income consumers, anxious higher-income consumers can fall into this category as well. This group will be limiting spending to the essentials, so don’t look to them for expendable purchases. This is not the group to target if you’re looking for spenders during COVID-19
Customers Spending Less During COVID-19: Pained but Patient
The “Pained but Patient” group will tend to be optimistic about the future but less confident about recovering in the short term or their prospects for maintaining their standard of living. They will also economize in areas of spending, though less than the “Slam on the Brakes” group. This is the largest category of spenders and also includes the majority of households not harmed by unemployment, which means a large range of income. This group may shift from more or less conservative spending depending on how bad or good the news is. They may be more likely to give in to the occasional indulgence, but not larger investments or expendables.
Customers Spending Carefully During COVID-19: Comfortably Well Off
“Comfortably Well Off” consumers are people who feel secure and calm about their place in the economy and their income, and they are going to be a more dependable target market for non-essential purchases. Their spending habits don’t really change, though they may now be more selective about their purchases and drive a harder bargain. This group is made up of consumers in the top 5% income bracket and also those who may be less wealthy but are stable and relatively unscathed in their finances. This often means the retired or investors who already made their profit. This is the group most likely to keep up their spending habits, and a safe group to target with your marketing.
Customers Spending Freely During COVID-19: Live for Today
The “Live for Today” group is one that is essentially carrying on and is less worried about their financial situation. The consumers in this group will respond mainly by extending their timelines for larger purchases. Typically younger and urban, they are more likely to rent, and they prioritize experiences over things (with the exception of electronics). Their consumption habits will likely remain consistent unless they become unemployed, so this is the second group that will likely respond to your marketing strategies.
Targeting Customers During COVID-19: Market to Those Who Fit Your Business
Now that you have an overview of the four main spending groups and which ones will be most profitable for you, you can use your business’s ad budget to your highest advantage by shifting your marketing towards that audience. There’s no use spending your marketing budget on a target audience that isn’t looking to make purchases right now, so focus on the spending groups who are most open to the service or product you’re selling.
Targeting Customers During COVID-19: Reaching the Right Spending Demographic
There are several different targeting tools on Facebook that you can use to identify the right kind of spenders and those with income. We’ve broken down these tools for you below:
Location and HouseHold Income Demographics
The Location and HouseHold Income tools work by targeting people within certain ZIP codes and the median income in those areas. This means you can direct your ads to a specific income bracket and those who are less likely to be negatively impacted by the recession. You can also advertise in the cities and communities where you are aiming to do business.
Demographics and Job Types
You can also target your ads to people with specific job titles, meaning you can identify people who are more likely to still be employed and working. This would include people in the healthcare industry, essential workers, pharmacists, senior care providers, etc. You can see more examples of recession-proof jobs and industries to target here. Within Demographics, you can also target people based on age and education level, which is useful if you’re trying to reach millennials who are still spending freely in the “Live For Today” category, or older retirees who are still comfortably well off and financially secure.
Interests and Behavior Demographics
Use the Interests and Behavior tools to focus your ad spending toward people with hobbies and interests that are typically more expensive or associated with higher income. You can do this by targeting Facebook users whose “likes” indicate interests such as frequent travel, luxury brands, the latest technology, high-end restaurants, etc. This strategy isn’t foolproof, however, as anyone can “like” something on Facebook without necessarily being a viable consumer of that product, but with Behavior tools, you can target people based on their past purchases and spending history, meaning you can see if they have or are are likely to spend money on products or services similar to yours.
Targeting Customers During COVID-19: Reaching the Right Audience
After you have determined which groups are likely to spend their money and figured out how to locate and reach those groups in your marketing strategy, you can go on to target the pockets of people within your already-existing target audiences. Remember–you’re not just trying to reach people with money; you’re trying to reach the people who are most likely to spend their money on your service or product. This means that you shouldn’t target older, comfortably well-off people just because they have money if they are not your target audience. For example, it wouldn’t make sense to market high-intensity recreational gear to retired people in their 70s, just like you probably wouldn’t market cosmeceuticals or specialized medical care to millennials in the “Live for Today” category.
In order to reach the right customers, you have to meet them where they’re at, and right now that means digitally and on social media. You can then direct your ads and messaging to the platforms that contain your target audience.
To figure out which kind of consumers are on each social media platform and which ones you should be taking advantage of during COVID-19, read: WHICH SOCIAL MEDIA PLATFORMS YOUR BUSINESS SHOULD BE USING DURING COVID-19 AND BEYOND
It’s also important to remember that your most reliable audience is your already-existing customers. This is especially true during a recession, so don’t ignore those who have already given you their business! Use social media platforms and email marketing to check in with your loyal customers and address their needs and concerns. Now is the time to strengthen that base, not abandon them.
For more tips on strengthening your online community and retaining customer loyalty through your marketing, read: TIPS FOR SOCIAL MEDIA AND DIGITAL MARKETING DURING COVID-19
Although the economy has suffered drastically the past few months, and your business may be anxious about what’s to come, targeting consumers who are willing and able to spend their money during COVID-19 is an effective way to make sure you are not wasting your (potentially tightened) advertising budget on audiences that don’t have income or are cautious to spend. Let them know how you can still provide your products and services, that you’re still relevant, and most importantly, that you care about meeting their needs and are still worthy of their business during this challenging time.
For more tips on how to successfully market during COVID-19, be sure to check out our other blog posts, and remember that SND Agency is an experienced, results driven full service social media agency who understands that many businesses need extra help during this time. If that sounds like you, we would love to hear from you about partnering with your business to leverage your social media presence for success now and in the future! Contact us today!