Over the past couple of months, marketing budget has come up in several conversations with colleagues, fellow marketers and business owners. Right now, times are extremely tough for many businesses – likely more so than ever before. We understand. Historically, marketing is always the first budget to be cut – but should it be?
Marketing teams have been cut across the board – from redundancies in a marketing department of a large corporation to smaller businesses cancelling contracts with an outsourced marketing provider.
It is interesting that marketing is still thought of as a cost rather than income generating and given such little value in difficult times.
Why marketing budgets are the first to be cut?
Marketing is seen as an optional, non-essential cost to many business owners.
When income is reducing, or in times of recession, it is good practice for a business to reconsider their business plan. This would involve assessing their costs and outlining those that are dispensable and “nice to have” over those that are crucial to the ongoing success of their business.
Of course, when times are hard – like they are now – decisions do have to be made as to whether to continue to pay for something over something else.
However, when marketing is cut completely it can have long-lasting effects for a business that may even be the difference between future success and failure.
At Marketing Square we work with a mix of businesses, some of whom have chosen to pause their marketing and others that have chosen to continue even thought their income has fallen due to the Covid-19 pandemic. Claire – Marketing Square
Why a business shouldn’t cut their marketing completely (if at all possible)
Marketing is essentially a means for you to obtain new customers. If your income is already declining and you cut your marketing budget completely, it significantly reduces your chances for an increase in income.
Marketing is also communication, so existing customers that are usually prompted to take action by your marketing communications – be it on social media, email or advertising – may also reduce their purchases or their contact with you, as they slowly forget about your brand.
These two factors combined, can mean your business runs the risk of cutting off the channel for both existing and new customers.
Other things that can occur when a marketing budget is cut:
- Your competitors, who are continuing to invest in their marketing, can steal your market share.
- An absence of your brand means new customers looking for services you offer won’t be able to find you.
- You are giving the message to your customers and potential customers that your business is not stable if it just disappears completely.
- Income may continue to decrease and if it decreases to the point when you can’t cover “essential costs” it may need to close down.
Right now, in these unprecedented times, there is a lot of compassion out there. Loyal customers may remain loyal, at least for the short-term, as individuals and fellow businesses offer support for their service providers and favourite brands. How long will this last though if your customers don’t see or hear from you?
The bottom line is longer you stay away from communicating about your products and services, the higher the risk of failure, or the longer it may take you to get back on track.
Seeking opportunities requires marketing
It is difficult to justify spending out on any marketing, particularly if you are a small business and your income has fallen.
However, the key to entrepreneurship is seeking opportunities even when there is bad weather. For that you need a marketing and communication strategy.
Many big brands have chosen to actually increase their marketing budget during the pandemic, knowing they need to do so to retain their market share. They may also be able to grow their marketing share in the long-term, as competitors drop off during the process.
The Burger King giant brand has capitalised on their “Social Distancing Whopper with Triple Onions” – finding a creative way to promote their products during these changing times. Things like this stick and this is only one example of how businesses have adapted their product or service offering to suit changing market conditions.
For the small business owner, simply the fact that thousands of people are sat at home flicking through their phones, social media accounts and emails is an opportunity for you to get engagement with your brand.
DIY Marketing Tips
For some small business owners, it will be an option for you to do a little of your own marketing, to keep up a presence online.
It shouldn’t be underestimated the work that goes into marketing and if you currently get professional marketing support, it will likely be noticeable to your customers if you switch to doing things yourself for a while.
This is why it should really be a means to an end with a view to reactivating a budget as soon as possible, to avoid your brand image being negatively affected.
However, with the mindset that something is better than noting, it is an option to implement some DIY marketing in the short-term.
This could include:
- Creating posts on social media and engaging with your connections’ posts.
- Sending emails to your existing customers, i.e. a newsletter, to let them know you are still there.
- Going Live using Facebook or Instagram.
- Writing blogs on useful topics relevant to your business and sharing them via social media and email.
If you have been offline for a while, you may even want to consider a re-launch campaign of your brand, which would create some noise around it being back in business.
Key Takeaways
- If you can at all avoid it, don’t cut your marketing budget completely.
- By cutting your marketing you run the risk of giving away market share to your competitors as well as cutting off the lifeline to generate future sales.
- If you need to, scale down and prioritise tasks to meet a reduced budget.
- If you can, increase your budget so you can come out the other end in the strongest market position.
- If you decide to do your own marketing, make it a temporary measure to protect your brand image.
Marketing Square is very much still open for business. We are available for any questions or to see how we can help you navigate your marketing through these tough times.
