Why influencer marketing might be the saving grace for indie hackers in this economic downturn (NOT ADs!)

In 2022, we saw top VC and consulting firms put out statements like:

"With the macro uncertainty around inflation, interest rates, and war, investors are looking for companies that can produce near-term certainty. The market is signaling a strong preference for companies who can generate cash today"(Sequoia)

"Winning companies have an opportunity to accelerate profitability during and after the recession, while losers get stalled." (Bain and Co.)

There's a focus on generating cash TODAY and being profitable.

In a recession, your first order of business should be to cut costs and divert them to the channels that you know will drive profit. Especially if you're self-funded.

Influencer and ambassador-based marketing is one such channel.

Before someone types this in the comments, influencer marketing is not just about paying for posts. That's an old and mostly ineffective model.

Here's what you can do TODAY:

👉 Start product seeding

This is when you send free products to small creators and create incentives for them to post about you. Incentives such as a discount for their audience, or maybe even affiliate commissions for them. I've written in depth about it, so let me know in the comments if you want to read that post.

👉 Create an ambassador program

Turn some of these influencers who post about you into ambassadors. What that means is long-term partnerships where you do giveaways, live sessions, and work with them in deeper ways.

Usually, an ambassador program comes with the influencer receiving a % of sales they drive. This helps you only pay per sale, instead of paying for placements on ad platforms (hence being more profitable).

👉 Stop playing catch-up with ad algorithms

Spending more on ads is not going to work anymore (unless ads are already working for you). Allocating $1000s for testing each month is only eating into your profitability and making your cashflow weaker.
Stop running behind trendy ad platforms and work on building relationships instead.

👉 Build long term relationships with creators

In a downturn, it's the "soft", non-quantitative stuff that matters more.
Work closely with influential people in your niche and these relationships will keep generating profit for you, without needing to pay for ads or do any of the stuff that only works in bull runs.

Cheers!

What do you think about this line of reasoning?

Curious to hear how you all are adapting to the downturn wrt picking the most profitable marketing channels in a recession.