We’ve experienced a tidal wave of economic doomsday during the past six months.
Sensationalized business news headlines seem like cruel jokes, written in complete opposition to one another (“Recession is on the horizon” one day; “Recession is off the table” the next). During moments of difficult financial evaluation like these, marketing budgets come under particular scrutiny.
It probably explains why advertising and marketing spend spiked at the height of the pandemic, but during the latter half of 2022, budgets were slashed to pre-pandemic (and even lower) levels. But we won’t be the first ones to tell you that retreating in financially stressful times is an unwise move.
Savvy brands strike while the iron’s hot, taking advantage of this enormous marketing windfall. The results pay far greater dividends than riding out the storm ever could. The challenge is figuring out — in the face of all the rah-rah and positive thinking — how to get C-suite buy-in on ambitious marketing spend. Here’s what they should know.
The Benefits of an Open Playing Field
Marketing spend dipped by nearly $30 billion over the Great Recession. But brands that held fast and doubled down on their budgets (despite the financial flak) continued to succeed. Bucking expectations, those organizations that increased their spend saw 17% higher ROI, showing how a recession doesn’t have to be an excuse to cut spending.
The point you need to emphasize to the C-suite is simple: In a less-active marketing landscape, increased spending maintains and heightens brand recognition. As noted in SEMRush’s 2023 state of content marketing report, brands with a monthly content budget over $5,000 were 26% more likely to have “very successful” results compared to those with monthly budgets under $1,000. When your C-suite sees there’s more room for your brand to be heard over retreating competition, you can catapult yourself forward with tactical investment.
An Oasis of Opportunity
Supply and demand applies to the marketing world just like every other capitalist enterprise. Many competitors will pull their budgets from traditional media and marketing spending, slashing prices across numerous marketing opportunities.
Case in point: In a 2022 report on marketing spend in a recession, Nielsen reported that an investment in media during recessions can produce higher ROI than at any other time, as the cost for traditional marketing tends to dip in response to lower demand. Backed with that knowledge, your pitch to the C-suite should be that more affordable prices will allow you to execute the exciting, daring brand strategies and marketing ideas you’ve always wanted to test out, in a less competitive environment.
Marketing for the long-term
Recession marketing planning primarily consists of short-term maneuvering to achieve immediate ROI, eschewing long-term gains to pad the balance sheet for the next quarterly report. But economic upheaval breeds significant investment opportunities, particularly sustainable brand loyalty.
A study from research firm Brand Keys Inc. shows that during a recession, more industries see stable or increased loyalty rather than a dip. Loyalty is a particularly valuable asset during down periods since return customers statistically spend 67% more on average than new shoppers. When money’s tight, you can turn to the customers willing to spend big on your brand.
So how can you weave brand loyalty into your complex marketing budget? It boils down to driving brand affinity by creating content that both reflects the values of your loyal consumer base and advances your brand vision. A recession is an emotional time for everyone, making it such a perfect moment to lean into those values and their associated emotions. Your C-suite needs to understand that people support companies that resonate with them in times of crisis. If you can optimize your content for personability and connection, you can be one of those companies.
Stop asking, “Are a few ads and content really worth the money?” and start thinking, “How can I get ahead of my competition?” Your greatest weapon right now is sustained marketing spend that anchors you during a chaotic period. Reinforcing your voice and values through continued messaging will protect the jobs you want to keep, the products you want to launch, and the goals you want to achieve. Use this golden opportunity to forge ahead and turn your brand into the next household name.