As the Business Development Director for a growing advertising agency, I’ve had the privilege of meeting with many innovative marketers.
One prominent challenge marketers face in economically challenging times is that their budgets are often singled out as a target for cost-cutting while still needing to deliver results.
Speaking to several marketing leaders over the last 12 months, they find convincing the CEO or the board of the value of sustaining a share of the market in challenging times near impossible.
With the growing cost-of-living crisis, many companies are returning to survival mode.
Here are seven reasons to keep investing in your marketing:
When times are uncertain, consumer behaviour often changes. Consumers tend to become more selective about where they spend their money, often doing more research and consideration before making purchases.
If a business decreases its marketing spend, it risks losing visibility among consumers, making it harder for them to remember the company when they are ready to purchase.
2. Competitive Advantage
The business landscape becomes more competitive during challenging economic times. Some businesses may increase their marketing spend to gain market share. If a company decreases its marketing spend, it risks losing ground to its competitors.
3. Customer Relationship
Marketing is about promoting products or services and maintaining relationships with customers. When businesses reduce marketing spend, they may also reduce their capacity to engage with customers effectively. This could lead to decreased customer loyalty and potentially a loss of business.
4. Long-Term Brand Equity
Brand recognition and reputation can take years to build, but they can erode much quicker without sustained marketing effort. Reducing marketing spend can lead to a decline in brand equity, which might be detrimental to a business in the long run.
5. Market Share
A business can increase its market share by continuing to market effectively during economic downturns. Those companies that retreat and cut back on their marketing efforts risk losing market share, which can be difficult, if possible, to regain when the economy improves.
6. Innovation and Adaptation
Uncertain economic times often necessitate creation and adaptation. By maintaining or increasing marketing spend, businesses can communicate new approaches, products, or services that meet the changing needs of consumers. Cutting back on marketing may hinder these communication efforts.
7. Consumer Trust
In uncertain times, consumers look to businesses for stability. Maintaining a solid marketing presence can help build consumer trust, signalling that the company is stable and reliable.
While it might be tempting to decrease marketing spend during economically uncertain times as a way to cut costs, it’s proven to be a risky move.
Rather than making across-the-board cuts, businesses may consider strategic adjustments, focusing on business development and high ROI activities and leveraging more cost-effective digital channels.