With a recession looking inevitable and the cost of living crisis at the forefront of people’s minds, the outlook for some businesses next year may be filled with uncertainty. Organisations will be examining where outgoings can be reduced, and frequently it is the marketing budget that comes under scrutiny and suffers a cut. This may not however, be the smart place to reduce costs.

There is a well-known industry saying ‘When times are good you should advertise, when times are bad, you must advertise.’  For the past few years your marketing strategy may have been to increase your share of voice or to increase your brand awareness. To cut back now on your marketing spend could potentially unravel what you have worked so hard to create.

There are many objectives to marketing. One is of course to increase sales but another is to establish and maintain a loyal customer base. Just because the market is slowing down, do not let your marketing go quiet. In fact, research shows that the companies that continued to invest in marketing during the last global recession in 2009, bounced back quicker from it. Reckitt Benckiser actually raised their marketing spend by 8% in 2009 despite the most challenging marketing conditions. They capitalised on reduced marketing by their competitors and subsequently grew their profits by 14%. It is also possible to be successful and launch new products in a global recession. Amazon grew its sales in 2009 by 28%, in part due to the launch of the Kindle, as they continued to invest in new product development and find new opportunities.

I think the key word is ‘invest’. Reckitt Benckiser saw marketing as an investment rather than an expense.  In these challenging times, businesses need to not lose sight of their long-term objectives and how they plan to achieve them to ensure they remain competitive in future years. How do you plan to invest in your current customers and gain new customers?

As the climate changes, scrutiny over expenditure increases and consumer buying behaviours alter. It is, therefore, wise to revisit your marketing mix. Consider whether you are spending your marketing budget on the right tactics, on the right channels and in the most cost-effective way?

If you want to continue growing and evolving your marketing, you may want to consider outsourcing your marketing or elements of your marketing. Outsourcing to a third-party agency can be used in addition to your in-house team or to run your marketing activities entirely. Contrary to what many believe, outsourcing an activity does not mean increased costs, in fact it can be a very cost-effective option. 71% of companies in the UK are planning to outsource to reduce costs (Genius Outsourcing Statistics UK, 2022).

Telemarketing can be very cost effective to outsource, particularly if you use a drip feed method, with approximately one day per week of calling. This type of campaign can be far better value when compared to the cost of an employee!

Other advantages of outsourcing include great flexibility around commitment, it allows for easier scaling up and scaling down of activities, access to a wide range of experts and a fresh perspective.

Marketing will continue to be crucial for any organisation despite the economic climate. It is important to not lose the customer base you have built, engage with potential new customers and continue product development to meet unmet needs. Learnings from previous recessions show that companies were successful by maintaining marketing. Your current marketing strategy and activities may need to adapt to reflect the ever-changing needs of your customers but remember not to lose sight of your long term organisational goals.

 

Subscribe to our newsletter

Loading