In today's rapidly changing marketplace, understanding the relationship between supply, demand, and your marketing approach isn't just theoretical—it's essential to your bottom line.
With precious ad dollars in your media budget, let's explore how market-driven economics can transform your advertising strategy into a more responsive and effective tool.
When Supply and Demand Shift: Real-World Marketing Implications
Whether it’s the “it” toy for Christmas, the latest TikTok fad for home chefs, or a run on gardening supplies before Memorial Day, business owners selling the most popular products of the moment face an unexpected situation: skyrocketing demand but limited supplies.
When this happens, your company needs to make an immediate marketing pivot. You want customers to know you have what they want and earn their business. At the same time, you don’t want to overpromise and leave potential customers disgruntled and searching for new sellers.
Shifts in the market occur across various industries, affecting travel, retail, auto, home improvement, and numerous other top advertising categories.
Here are some tips on how to adjust your marketing plans:
When Demand Increases But Supply Is Limited
Situation: Customers are calling, emailing, and searching your website for a must-have, but your stock is dwindling and you can’t replenish fast enough.
Marketing Strategy Adjustments:
- Use radio ads to emphasize your business’s quality and reliability, including options to service an existing product, such as lawn or fitness equipment, or suggest alternatives.
- Build customer loyalty by communicating availability via email and text. (Bonus: this is a great way to build your email and text lists!)
- Stage a contest to win a high-demand, coveted item. Promote the contest on the radio, social media, and your website. Encourage people to sign up for your email and text lists to get notified as soon as the high-demand item is back in stock.
- Send email marketing to highlight differences from competitors entering the market and their products and services.
When Supply Exceeds Demand
Situation: In today’s fast-moving economy, sometimes you have too much of a good thing. That could be a particular model of SUV, furnace, or sneakers. But you need to make sales and keep business moving.
Marketing Strategy Adjustments:
- Create urgency through limited-time promotions advertised on air, social media, and your website.
- Market targeted ads to the most-interested customers online through digital display and OTT ads.
- Develop use cases for the over-saturated product or service and market in on-air ads.
- Research new customer groups and reach them with targeted ads on digital streaming, social media, and online.
- Bundle products to increase perceived value and email special offers to existing customers.
- Offer a promo code or discount only available to radio listeners.
- Generate buzz and increase demand with a contest for your over-stocked items.
The Power of Perception in Marketing
What consumers believe about supply can be as important as the actual supply levels. Consider these strategic approaches:
When Your Product Is Actually Abundant: If you have plenty of inventory but want to increase demand, consider these strategies:
- Create special editions or limited releases and promote them on air and online.
- Send email marketing that highlights the unique aspects of your products and services to make them seem more abundant.
- Offer promo codes exclusively to text and email clubs
- Use scarcity messaging, including "while supplies last" or "limited availability," in on-air and social ads.
- Recruit popular radio hosts to endorse the product or service on-air. These influencers effectively connect with their audiences and drive powerful conversions.
When Your Product Is Genuinely Limited: If customers are clamoring for a product or service but your company can’t keep up, consider these options:
- Transparently communicate the reasons behind limited availability in emails, ads, and texts.
- Post on the website and social media that customers can join waitlists by sharing their email and phone number, capturing demand, and building your marketing database.
- Transform the limitation into a selling point ("small-batch," "handcrafted") and emphasize that in radio ads and social media.
Practical Marketing Responses to Changing Market Conditions
When New Competitors Enter During High Demand:
- Differentiate aggressively — Communicating through radio spots makes your product stand out.
- Utilize influencer marketing tos stand out — Engage DJs and radio hosts to discuss the exceptional qualities of your business compared to others to their highly engaged audiences.
- Leverage your experience — Emphasize your track record and expertise in blog posts, social media, and radio ads.
- Build community — Create a sense of belonging among your customers that new entrants can't match. You can invite them to events or offer special promotions for discounts or a first look at incoming stock for existing customers – anything that affirms loyalty to your business.
When Demand Decreases:
- Pivot your positioning — Find new ways your product solves evolving problems and tell that story in radio ads, blogs, and social posts.
- Explore adjacent markets — Identify new customer segments with similar needs and target them with digital advertising or expand to new radio stations where they are listening most.
- Innovate your offering — Add features or services that create renewed interest and spotlight them with contests or giveaways. Market the promotion on the radio and direct customers to share their email or phone to enter, allowing you to reach a larger audience of potential clients with this effort and future marketing.
Making Supply and Demand Work for Your Business
The most successful marketers don't just react to supply and demand—they anticipate shifts and position themselves advantageously before their competition.
Consider conducting regular market analysis to spot emerging trends. Watch for:
- Changes in consumer search behavior
- Social media conversations about your industry
- Competitor inventory and pricing adjustments
- Industry news and regulatory changes
By monitoring these indicators and adjusting your marketing strategy accordingly, you'll be better positioned to navigate any market condition, turning potential challenges into opportunities for growth.
Need help developing a marketing strategy that responds effectively to your market conditions? Federated Media's team of experts can help you navigate these complex waters. Contact us today to learn more about our comprehensive marketing solutions.
