In a difficult economy, marketing spend is often the first cost cut by a company looking to save money and play it safe – yet, as Mike Symes, author of Light Your Firebrand, points out, it could be the riskiest move a company could make …
“Anybody who retrenches because of the recession has really got has head in the sand,” said John Vanderzee, of the Ford Motor Company, back in 1991. “You can’t not spend.”
To increase spending on marketing at this time may seem counter-intuitive, but this is exactly what businesses should be doing right now. Brands with sustained marketing expenditure will create strong competitive advantage by stealing share of voice.
Four ingredients need to be in place for this to happen:
Character
Create a leadership positioning based on the core essence of your brand and become the authority in your market.
Culture
Foster entrepreneurialism to develop plans, pilot new marketing approaches and roll out successes.
Capital
Commit the resources and budget you need to make your plans a reality.
Calendar
Put deadlines and milestones against every element of your programme and monitor and measure progress.
In this market, too many senior executives have been watching and waiting on what will shake out from the downturn. So much time is spent agonising about what they shouldn’t do – their greatest danger is substituting action with analysis.
Organisations can get away with this in a boom economy. They can’t get away with it now. The antidote to the recession is a commitment to action.
No matter how many ideas you have swirling around, not one of them is worth a penny to you until you actually take action on it. This is the time to choose five new initiatives and test, test, test.
It can be argued that marketing in a downturn is an “opportunity to gain market share at the expense of weaker businesses that choose, or are forced, to cut marketing expenditure”, as Peter Field observes in Market Leader magazine.
I echo this completely. I’ve seen the organisations that have cut their budgets struggle to compete in the upturn cycle last time around, while the players who maintained a market presence have since flourished.
What I have found particularly interesting was the analysis of the extensive Millward Brown database on the impacts of budget cutting. The article concludes: “Its data shows a strong correlation between market share and the level of bonding – an aggregate measure of multiple brand/consumer relationship metrics. The clear implication being that if budget cutting results in a decline in bonding, then market share can be expected to decline.
“In the past year, I have seen evidence first-hand that suggests that brands that cut their budget relative to competitors are at greater risk of share loss”
“Crucially, further data demonstrates that two key constituent brand relationship metrics – brand usage and brand image – suffered considerably (13 and 6% declines respectively) when brands went dark (ie ceased to spend on communications) for a period of six months or more. More broadly, 60% of brands going dark see decline in at least one key relationship metric after just six months.”
In the past year, I have seen evidence first-hand that suggests that brands that cut their budget relative to competitors are at greater risk of share loss. It’s time to shine out in the media blackout.
I read a great quote from Seth Godin. It said: “Professional service marketing is certainly among the safest I’ve seen. Because it appears to take no risks, it’s actually quite risky.”
Since safe marketing approaches are, by definition, quite so unremarkable and consequently go unnoticed, these are the ones that put your marketing investment at the highest risk. Ironically, if you want to be truly risk-averse and protect the future of your business and your brand, it’s time to stop being quite so safe and identify how you can stand out.
Once described by The Huffington Post as “The world’s leading personal brand accelerator,” Mike Symes is a branding strategist and communications expert, and founder of the Strand group of companies. He is also the author of Light Your Firebrand, published by Ecademy Press. This article was published in the October issue of Furniture News magazine.
