Winning in Hard Times: Why Most Businesses Shrink and a Few Roar Back

The Game Changes in Hard Times

When the economy tightens, the game of business fundamentally changes.

In good times, customers tend to be more relaxed, optimistic, and receptive.

In hard times, fear chases them inward. Every purchase feels riskier. Every decision feels heavier. Every sales encounter feels like it could be a trap.

This is the moment when businesses either retreat into a death spiral

—or plant flags all over the market.

Let’s play out both below so you can decide which route to take.

What Your Competition Will Do (The Death Spiral)

In hard times, competitors:

• Cut any marketing that isn’t directly attributable to revenue. (Meaning, they cut the stuff that actually builds customer preference and brand.)

• Pump every dollar they have into PPC, driving click costs through the roof

• Lower prices while eroding profit

• Cut perks and benefits, making their employees a flight-risk

• Cut headcount, damaging their product/service quality

• Cut marketing again

And the downward spiral continues…

Why Hard Times Change How Customers Feel

When consumer sentiment tanks, buying becomes emotionally loaded.

If you give a ballpark quote of $1,000 which becomes $2,500 based on complications, the customer in a strong economy says:

“Annoying, but okay.”

The customer in a tight economy says:

“{insert expletive here}, you’re taking advantage of me.”

When people are financially insecure, they don’t want a vendor.

They want an ally. Someone who shares their values. Someone they trust.

Hard times magnify emotions, and marketing that fails to bond emotionally is received as cold, transactional, or even predatory.

Different Market, Different Goal

In good times: revenue is a decent long-term proxy for marketing effectiveness.

In hard times: revenue is suppressed across entire categories.

In good times, you can try to maximize revenue per transaction.

In hard times, that playbook backfires.

When times are tough, the goal isn’t “How much can I squeeze from each customer today?”

It’s: How many future customers am I winning the affection of right now?

Put another way, your goal is to become “the company customers think of first and feel the best about when they need what you offer.”

Because when the economy rebounds — and it always does — the emotionally preferred brand gets all the big-ticket purchases.

This is how companies “suddenly” roar back.

It’s never sudden. It’s earned.

Practical Guidance

1. Customer Bonding Marketing (The Top of Funnel That Competitors Abandon)

Customer bonding campaigns are the consistency layer that builds:

• Emotional priming

• Memory

• Trust

• Familiarity

• Fluency

Keep investing here and you quietly become the market leader.

2. Branded Keywords (Cheap Insurance)

If you have a mature, emotional marketing campaign running, protect it with branded keywords.

They are:

• Cheap

• High intent

• High conversion

• Strategic “catcher’s mitts” for offline brand-building

As your competitors get desperate, they will start bidding on your name.

Branded keywords are a cheap way to ensure the leads you’ve been investing in, buy from you.

3. Unbranded Keywords

PPC costs are now 50%+ higher than 2023 levels in many categories.

Source: Google & Merkle Quarterly Benchmarks, WARC Digital Investment Notes.

Pay close attention to Return on Ad Spend (ROAS)

A huge number of businesses are now seeing: 

$1.00 spent → $0.70 returned

This happens because:

• All competitors panic-bid at the same time

• Demand shrinks

• CPC rises

• Conversion rates fall

• The entire math equation breaks

You don’t fix broken math by pushing harder on the gas.

You fix it by relying less on what everyone else is overpaying for.

You may find it’s making financial sense right now, great! Just don’t become dependent of it as the rug could be pulled out from under you.

4. Add Adjacent/Recurring Revenue Streams

These can be low cost and high impact which smooth cashflow while reducing Customer Acquisition Cost and increases Customer Lifetime Value.

A few examples:

A roofing company offering annual moss removal and roof cleaning:

• Attracts customers who aren’t ready for a new roof

• Extends roof life

• Becomes the brand customers trust when replacement is needed

• Get the first “at-bat” when the roof needs replacing

An office furniture company offering semi-annual cleaning and maintenance:

• Promotes long term satisfaction

• Becomes trusted brand when the client needs new furniture

• Get the first “at-bat” when new office furniture is needed

In short, when you add lower-ticket adjacent services, you capture customers earlier in their lifecycle and become the “go-to” brand when a big-ticket purchase is needed.

5. Consistency and Repetition Wins

Repetition builds familiarity. Familiarity triggers trust. Trust opens wallets.

The data shows:

Brands with strong long-term consistency generate:

• 2–3× more benefits to their brand

• 2–3× more benefits to their business

• Significant increases in pricing power

Source: System1 “Power of Compound Creativity”: https://system1group.com

Source: Binet & Field - Long and Short of it 10 Years On

Hard times magnify this effect because fewer competitors stay consistent.

Hard Times Delay Purchases and Shuffle the Competitive Landscape

During hard economic times, most business owners look at revenue and cringe. In reality, they should be more focused on winning over the hearts of potential customers.

Your competitors will shrink their presence.

They’ll vanish from minds, then vanish from markets.

This is your moment to:

• Plant your flag on customers

• Build emotional preference

• Maintain consistency

• Expand mental availability

• Capture more future demand

And when the economy rebounds — as it always does —

your business will be the one the market rushes back to.

Plant flags now.

Reap the windfall later.

That’s how you roar back.

At the time of this writing, I’m giving all my clients economic “weather reports”, and I’m thrilled each of them are ready to capture meaningful marketshare if the economy sours.

If you’d like a “weather report” and to discuss how to ready your business for hard economic times, email me at MattWillis@WizardOfAds.com

You won’t get a sales pitch. You’ll get free advice tailored to your situation.

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