Blog posts tagged spending review

Marketing spending reviews - the pressures and possibilities

With the Conservative Party conference over, thoughts turn to the government spending review and how it will affect business and the economy. Whatever the outcome in the long term, in the short term there is little doubt that businesses will continue to approach both expenditure and debt with caution. So what is the likely impact on marketing?

Casualties

The first casualty is likely to be external expenditure. Marketing consultancies will find it hard to win business, and increasing pressure will fall on in-house staff as they are expected to make up the difference. Knowledge of new technologies will be at a premium as more companies look to develop and maintain expertise internally. Only last month, the BBC revealed how in-house SEO had helped it to slash its marketing budget. Marketing staff of small companies will be expected to be jacks of all trades, to reduce reliance on expensive external resource.  

Expect large, costly projects such as re-branding to be postponed. There will be an emphasis on cutting out unnecessary expenditure. Companies will recycle existing advertising campaigns rather than splash out on new ones. It will never have been more important to know which half of your advertising budget is wasted! Spend will continue moving towards online advertising, simply because results can be tracked accurately and unnecessary costs eliminated.

A word of warning, though. Companies that cut back too far on marketing will lose out long-term, yielding ground to more ambitious competitors who continue to invest and seize the opportunity to gain market share. It was ever thus. Marketing theorists cite the example of Cadbury’s, who continued advertising throughout World War II – even when they didn’t actually have any chocolate to sell – and gained dramatically as a result.

Opportunities

Marketers must accept that it’s a season to cut out the dead wood, and probably some green shoots that haven’t yet been fruitful. But it’s also a season of opportunity. Where one company cuts back, there is the chance for another to step in. In advertising it will be a buyer’s market, with bargains available to the shrewd negotiator. Technologies like social media and mobile are still developing rapidly, with whole new territories opening up for businesses willing to invest early.

Pressures there might be, but possibilities there certainly are too, for companies willing to take the risk and step forward into the breach.

 

Bruce Townsend is an expert contributor to Marketing Donut and online marketing specialist at Actinic.