How To Innovate In Times Of Economic Ambiguity

By Ben Zimmerman, president at SmartMedia Technologies.

You aren’t alone if you’ve felt like the economy has been on a roller coaster since 2019. Following the outbreak of Covid-19, lockdowns, travel restrictions and other measures were introduced to reduce the spread of the disease—but also ended up leading to the shortest recession in U.S. history. While certain sectors have bounced back, the last few years have felt a little shaky.

So, are we inching toward another recession? A few months into 2023, the verdict is still out. As some point out, the argument may be a matter of semantics. The word “recession” has many interpretations, after all, but the National Bureau of Economic Research (NBER) has stated that we are not in a recession. Some benchmarks have sent mixed messaging, making it difficult to draw clear conclusions about the future. In 2022, the inflation rate in the U.S. was 8%, compared to 4.7% in 2021. Conversely, unemployment rates have hit historic lows, dropping to 3.4% in January 2023, the lowest level recorded since May 1969.

As a business owner, you may feel pressure to predict the future. But let’s face it. Trying to anticipate every turn the market takes is an impossible game to win. So, what can you do? Here’s a secret: You don’t need a crystal ball to succeed. Amid times of turbulence, it’s crucial for businesses to stay vigilant and make wise decisions. And simply playing it cool may not cut it.

Opportunity breeds innovation.

It’s a well-observed business maxim that opportunity breeds innovation, and companies can succeed even in times of economic uncertainty. For example, Uber identified an opportunity in the transportation industry during the 2009 global financial crisis (although its ride-sharing service wasn’t launched until later). It now provides a popular and affordable mode of transportation. The company leveraged innovative technology to create new opportunities and disrupt traditional industries. And it’s still a household name.

So, should you dump all your funds into research and development? Not quite. Implementing cost-cutting measures during economic uncertainty is prudent. Focusing on maintaining strong customer relationships is wise. These are all sound business policies that you should not ignore. But businesses can also diversify their offerings, seek out new markets and invest in new technology. In other words, they can push their boundaries. As they say, when the going gets tough, the tough get going—and while some brands play it safe, trailblazers know how and when to take risks.

Economic ambiguity can create gaps in the market. It’s during these times that traditional solutions are ripe for disruption. Consumers may change their spending habits due to emerging trends. Or they may become more willing to switch to alternative products as they become more selective about their purchasing decisions. And whether you’re developing a new product or reimagining a current one, nurturing the sales funnel with a healthy lead volume should be one of your top priorities.

You can boost ad spend with evolving technology.

By identifying gaps and listening to consumer needs, businesses can create solutions to fill them. One of the disconnects I’ve noticed is between consumers and big advertising. In 2021, Google, Facebook and Amazon alone were expected to capture more than 60% of U.S. ad spending, according to eMarketer. Recently, trust in the tech sector has become among the lowest in all sectors, with 32% of respondents considering it less trustworthy than other sectors, according to a 2021 Public Affairs Council and Morning Consult study. Consumer trust in data security is also a concern, as Pew research from 2019 showed that 70% of adults said their personal data is less secure than it was five years ago.

As the president of a company that offers a Web3 enterprise platform, I’ve found that Web3 has emerged as an innovative interlocutor between advertisers and consumers. Web3 is decentralized, often leverages blockchain technology for data storage and is not controlled by any single entity. Compared to traditional online advertising platforms—largely controlled by big tech companies—Web3 advertising could offer greater transparency to advertisers and consumers. Web3 advertising could also create more meaningful interactions. One way it can achieve this is through opt-in ads, which allow consumers to decide what data they want to share with advertisers. On the other hand, advertisers can track the effectiveness of their campaigns in real time to provide consumers with more targeted, engaging content.

Here’s how to get started with Web3 advertising.

Getting started with Web3 advertising requires understanding the fundamental concepts of blockchain, smart contracts and decentralized applications. To craft an effective strategy, consider your company’s objectives and goals in relation to Web3 advertising. Determine whether your target audience will be receptive to decentralized platforms and willing to engage with the Web3 ecosystem. From there, you can experiment with Web3-enabled advertising formats. For example, you can consider using NFTs to create collectible digital assets. Or you can use decentralized finance to incentivize token-based rewards or gamified experiences.

Collaboration with Web3 experts can also help kickstart the experimentation and implementation phases. This may mean seeking guidance from consultants, blockchain developers or specialized marketing agencies to help you navigate the complexities of this emerging field. Together, you can identify the best strategies for leveraging Web3 platforms that align with your goals and industry.

From NFTs to decentralized finance companies, Web3 has already begun to make waves. As I mentioned above, increasing ad spend during economic uncertainty can help boost brand awareness and help you stand out from the competition (who may otherwise be cutting back on their ad spend) while building customer loyalty. And increasing your ad spend with Web3 tactics could not only help you stay on the cutting edge but also help boost consumer trust.