Don't you dare cut your marketing budget

Nobody can runaway from the recession – it is a reality and we have to work with it. Some people are already noticing better times in the horizon, but nobody can be sure. Traditionally, a downturn in the economy means cutting marketing budgets. And according to a survey by marketingprofs.com, the financial crisis is causing immediate 2008 budget cuts and already affecting the 2009 budgets. In a recession, consumers become value oriented, distributors are concerned about cash, and employees worry about their jobs. But don’t let you get carried away by the negative mood. A downturn is no time to stop spending on marketing. It is a unique opportunity to consolidate your market position and increase your competitive advantage.

My message is clear: Don’t you dare cut your marketing budget – only if you are in a desperate need of working capital. If the budget is cut, your message could get lost in all the “noise” made by competitors. It’s time to get smart about your marketing dollar and spend it to bring results. That’s easier said than done.

How to do it

The key is to know your customers and look at your marketing spending as an investment – not an expense. Remember to: Devise a strategy, maintain market spend, assess and allocate the budget, research your customer thoroughly, target and reach out to them.

In other words it is extremely important to be well positioned. I firmly believe that if you get these things right your company could survive any recession and possibly thrive in them.

I have found the following guidelines:

1. Research the customer. Instead of cutting the market research budget, you need to know more than ever; how consumers are redefining value and responding to the recession.
2. Maintain marketing spending. This is not the time to cut advertising. It is well documented that brands that increase advertising during a recession, when competitors are cutting back, can improve market share and return on investment at lower cost.
3. Adjust product portfolios if/when consumers trade down to models with fewer options.
4. Support distributors. In uncertain times, no one wants to tie up working capital in excess inventories.
5. Adjust pricing tactics. Customers will be shopping around for the best deals.
6. Stress market share. Companies are in a battle for market share and, in some cases, survival.
7. Emphasize core values.

Good luck surviving the recession and remember you have a unique opportunity to improve your market position – if you are willing to act instead of only reacting.