Marketing budgets looked very different for many companies at the beginning of 2020 than they do now. Following the COVID-19 outbreak, everything changed. According to Gartner more than 44% of CMOs reported midyear budget cuts as a result of the pandemic, and nearly 11% of that group expect their budgets to face cuts of more than 15%. As we progress into the ‘recover’ and ‘renew’ phases of this pandemic, CFOs will turn their attention to profitability. Marketing has the dubious honor of topping the list of functions that finance will look to for trimming expenses even further. Many businesses tend to cut off vital marketing services and then pay for it down the line. A reactionary decrease on ad spend may look good in the books at first, but it does not do well for the longevity of your brand. Instead, CMOs should plan for future budgetary pressures now, rather than gamble on budgets bouncing back.
The new digital world requires Marketing performing fast response advertising, direct customer interactions, concentrated lead acquisition and globally orchestrated marketing communications. And this has never been more important than now. So, instead of slashing the budget, a recession offers a chance to reassess the strategy and reallocate available spend. It’s now a good time to tap into how effective marketing processes are, how well they could be trimmed, what new applications and systems to be installed to increase value of marketing and to get ‘more bang for the buck’ during a recession.
Find our Insights here: