Can user generated content help brands survive the cost-of-living crisis?

Ayaan Mohamud
By Ayaan Mohamud | 29 September 2023
Ayaan Mohamud.

Ayaan Mohamud, Regional Vice President Marketing at

Australian brands are in choppy waters as the cost-of-living crisis,  driven by the steepest increase to borrowing costs on record, stagnant wages and soaring power bills, begins to bite.

Retailers including luxury fashion brand Alice McCall, online clothes retailer EziBuy, and upmarket interiors brand Fenton & Fenton are just a few of the casualties of a recessionary environment as consumer discretionary spending is under pressure.

Consequently, it has never been more important for brands to make a meaningful connection with their target consumers. With less disposable income around, brands must fight even harder for consumer attention and consideration – at precisely the time that marketing budgets are under stress and scrutiny.

In challenging economic times, there’s a perennial debate around the correct balance between brand and performance marketing investment, but there can be no doubt that doubling down on low-cost/high reward performance strategies can provide vital incremental revenue when times are tough.

One increasingly popular strategy is leveraging user generated content (UGC) to build trust and drive long-term relationships with customers.

Here’s why UGC is a valuable marketing strategy in a consumer downturn:


Marketers can disagree on a lot of things but I believe (almost) all would agree that word-of-mouth marketing is the most powerful form of marketing there is. It gives consumers the peace of mind that they are discovering and making purchases from a brand that has been recommended to them by a trusted source- of particular importance when consumers are being more considered about how they spend their money.

The Know, Like, Trust Factor (KLT) is a time-tested marketing strategy based on the idea that people are likely to buy something if someone they know, like and trust recommends it. Nielsen reported that 89% of people trust personal recommendations. As people are living more of their lives online, these word-of-mouth recommendations increasingly come from a familiar face they “know” via social media but have never met. And this doesn’t mean it's a celebrity. Fuelled by the growth of TikTok in particular, the digital world has blurred the line between famous and non-famous as more ‘regular’ people create their own content for the world to see.

These types of content creators provide brands with an authentic channel that is helping drive trust and long-term relationships with customers.


The authenticity of UGC (assuming it’s done well) is its most valuable quality. This is particularly important in an economic environment where consumers are  much more concerned about how they spend their money; they need the security of knowing a recommendation is ‘real’. surveyed over a thousand social media users in Australia, Singapore, UK, USA and Canada and found that more than 6 in 10 consumers say they trust influencers they perceive to be like them, particularly if they share the same career or lifestyle choices. When brands forge partnerships with the right influencers, they can raise brand awareness, and create revenue effectively.

However, it requires a paradigm shift in traditional marketing thinking as the most successful UGC campaigns require brands to cede creative control to the content creator. This means ensuring that you partner with those strategically aligned with your brand’s goals and needs and then take a back seat.

For example, I recently heard Australian entrepreneur and content creator Fiona Wang talk about the fact that one of her most successful collaborations was with Sydney Oyster Tours – even though she states in the video that she personally hates oysters! A leap of faith for an oyster tour company to partner with an oyster-hater but it paid dividends with followers!


In an economic downturn when consumers are more reluctant to part with their hard-earned and dwindling cash, it's important to remove any barriers to purchase and provide a seamless shopping experience. The right tech can ensure that when consumers see a product or service they like from a trusted content creator they are able to make an immediate (and attributable) purchase.

It’s a little more nascent in Australia but we are seeing the rise of livestream shopping with content creators. Our research found 15 percent of Australians frequently or always watched livestream shopping hosted by an influencer but an additional 25 percent ‘sometimes’ do so it's certainly on the rise. Our study found that brands can increase consumer purchase intent during livestream shopping by requesting that influencers demonstrate how they use the product and share their experience. Additionally, offering an exclusive discount or promotion to the live audience can seal the deal.  For example, US cult bag brand Telfar uses exclusive product “drips” during livestream shopping events, leveraging its TV channel. Here, only active watchers can secure the latest designs. In fact, the brand launched its vegan leather duffle bag using a QR code flashed on-screen for one-minute intervals.


Another advantage of influencer marketing is that it’s now possible to measure it according to a range of KPIs. Whether it’s conversions, sales, reach and awareness, audience growth, or engagement, brands can deploy partnership management technology to provide a clear payout structure - it can be anything from fixed fee, through to performance or contra - to content creator partners.

The ability to measure referral-based partnerships in real time is extremely valuable when, more than ever, every marketing dollar counts. New Balance Australia for example, has run successful ambassador campaigns with university students; identifying highly engaged people within their universities. In this instance, New Balance leveraged Campus Group and student affiliate platform UNiDAYSto find verified university students, and then offered them referral discounts across a range of products to share with their peers and friends. All entirely measurable via QR codes, with students correctly rewarded for spreading the word about New Balance with their own social tribes.

In this economic environment, no single strategy or tactic will offer a silver-bullet to marketers but content creators and the use of user-generated content is a low-cost/high reward performance strategy that can make a real emotional connection with jittery consumers and give a much needed boost to sales.

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