Good news for marketing agencies, printers, and direct mail companies from B2B Marketing magazine. According to their “exclusive” survey, only 25% of all business-to-business marketers are going to cut their budget. But nearly one-third of them are actually increasing their marketing budget, while another 44% are leaving them intact. That’s good news for anyone in TV and radio advertising, digital marketing/advertising, and, of course, direct mail.
As I’ve been speaking to other marketing professionals around Indianapolis, they’ve all been saying the same thing: marketing spending is staying flat or increasing.
Increasing? In a down economy? Absolutely.
That may seem counterintuitive to some, especially the bean counters, but spending more on marketing now is smart. That’s because the 25% of marketers cutting their spending are your competitors. They’re hiding with their heads in the sand, which means their message isn’t reaching customers, which means customers aren’t buying, which means income is shrinking, so they bury their heads a little further. (Read on)
Here's what I offered as a comment:
Right on! I'd also add R&D and strategic planning. Here's why.
My Great Grandmomma was a woman from the American South who came North to escape the oppression of Jim Crow and find economic opportunity. Not educated past the 6th grade, she was filled with what the old folks used to call "Mother Wit," a kind of smarts that can't be taught in school. Momma Lena would look at the times we're now living in and remind me that "Trouble don't last always." She'd tell me to do everything I could to get ready for my blessing, adding "be ready to be found." That last bit was in her attempt to get me married off (Momma Lena, my Hubs is a marvel and I'm sorry you never got to meet).
Now, my spiritual path is one that this church-going lady would scratch her noggin hard over (I call myself a BaptiBuddhist Yogini), but her message keeps ringing in my head as I talk with fearful clients.
But, I digress: This won't last.
If we continue to freeze our spending completely, when the clouds pass, we'll be left in the ditch...by those companies that invested in (wait for it...wait for it...) marketing, R&D and strategic planning.
We see examples of firms that invested deeply even when they didn't have the sales figures to back up that investment.
A few years ago, when Apple's sales were sluggish and their customers spoke hushed tones about the Apple gospel of "not a PC," they invested--mightily. They learned more about themselves, their customers and the market. They created new products there weren't even names (or desires) for yet. They studied trends and created a few of their own. They created knowledge centers and centers of learning for customers and employees. They crafted their message. They created communities and systems in which those communities could interact. They cemented their brand. They became evangelists.
Apple and many other companies have succeeded by not giving in to scarcity and fear, but this says more about their strong, adaptable culture than, perhaps, anything else. That company's marketing systems are built to flex. Having gone up against the Microsoft Machine since their inception, they're accustomed to being the underdog with far less in cash reserves than their Redmond-based cousin.
That means that they had to get smart in whole new ways. Having proven that they could build a brand, largely, by word of mouth, they used their Mother Wit to design marketing systems that grabbed the attention of their customers--both those present customers and those who would have never thought to buy anything from Apple. We all know people who own PC's and iPods or iPhones, or shop at the iTunes Music Store.
I do think, however, that spending the same money on the same things is a no-go. The markets are fluid, malleable things. During this downturn, companies can--and should--be taking a close look at their knowledge systems (training, R&D, etc.) for ways to beef-up knowledge sharing and folding new learnings into development. Companies can also be looking (as they should have been along) at who their customers are, what they want, how they want to get it and how they want to be interacted with.
In short, this downturn is a "teachable moment," speaking volumes about continuous improvement in marketing, communication, product design, planning and execution--all the systems that make up a company.
The statement in the post about nonprofits and not cutting marketing or mailings is pretty brilliant. The recent presidential campaign is a testament to the power of marketing and of the creation of new, flexible systems for communication of messages to customers (in the political sense, voters). These nonprofits (Obama, Clinton, McCain, Romney, etc. for President) told us quite a bit about scalable messages and scalable marketing systems. And let's not forget, while the Obama campaign was raising money by the semi-load in its last month, we had already been in a recession for the better part of a year!