The advertising industry is undeniably facing significant challenges. Along with mass job cuts, commentators predict an inflation-fueled slowdown in digital ad spending next year as advertisers adapt to the cost of living. But there are other ways for advertisers to work around economic uncertainty. Rather than slashing ad budgets, a shift in focus to enhancing campaign performance and improving targeting capabilities is key.

Research has shown that emotional investment in content drives greater ad engagement and that positive psychological arousal can spark favorable brand perception and loyalty. So how can advertisers use this to their advantage and maximize spend as recession looms and budgets are scrutinized?

Harnessing Emotion To Drive Engagement

It’s no secret that campaigners and advertisers have used emotions to spark action for years—emotionally charged campaigns drive high psychological arousal, which represents our readiness to engage and take action. After all, research shows it takes less than three seconds to have a gut reaction to something, and emotive ads can engage audiences from the outset.

Some use fear to drive change, such as public health campaigns. Anti-smoking adverts, for example, often use graphic and unpleasant imagery to highlight the dangers of smoking and to convince viewers to quit. Similarly, climate-conscious brand Patagonia has often used shocking footage and bold, emotive messaging in its adverts to highlight the seriousness of climate change and the importance of taking action.

Brands also use positive emotions to encourage favorable brand associations and establish meaningful connections with consumers to strengthen their loyalty. Coca-Cola’s Christmas ads usually use happiness as a key theme, promoting togetherness around the festive holidays. This year, its campaign in the U.S. and Canada has centered around the message that “the holidays always find a way.”

Research has also shown that adverts with positive emotions result in more shares online, but so do feelings of disgust. This proves that strong psychological arousal spurs consumers to take action, and can boost brand awareness and reach as a result. During the economic crisis, as brands themselves feel the pinch, emotive ads can cut through the noise and drive engagement. Pairing the right emotional message with the right ad strategy and format can maximize its impact and boost campaign performance.

Right Content, Right Audience, Right Time

Nielsen research has found greater acceptance among consumers toward contextual ads presented within relevant environments. For example, if an internet user navigates to a sports website to read up on football results, they might be advertised a relevant football jersey or sporting event happening in the area.

The beauty of contextual advertising is that it targets the content consumers view rather than the individuals themselves. This means audiences receive relevant advertising tailored to the environments in which they appear and, by association, the audience’s interests. Moreover, users’ personal data is not compromised, providing a viable, addressable solution for the cookieless world.

Contextual ads may also be more effective than search ads depending on advertisers’ goals. Contextual ads allow advertisers to target wider audiences who might potentially be interested in products but are not actively searching for them yet. With search ads limiting advertisers to high-intent audiences who are already searching for information, reach is narrowed and potential high-value audiences are excluded. Paired with high-arousal creative, contextual targeting can deliver relevant content to the right audiences, at the right time, for maximum impact.

Creating Seamless, Non-Disruptive Experiences

It’s not just a specially tailored targeting strategy that can help drive impact; the ad format is just as important. Native advertising often works particularly well in tandem with contextual targeting, as it adopts the aesthetic of the environment in which it sits, integrating seamlessly into content for a non-disruptive user experience. Paired with contextual targeting, audiences receive relevant, visually pleasing creative that they’re more likely to engage with, as opposed to, in some cases, irritating pop-up ads.

As the economic crisis continues, there are gains to be had by adjusting advertising strategy rather than spend. Creative that is emotionally charged makes a bigger impact, but advertisers can amplify this through the use of more effective targeting and ad formats. Reaching the right consumers at the right time with relevant content is sure to drive bigger conversions, ensuring advertisers continue to prove ROI and hit key KPIs as inflation bites.

(As published on Forbes)