Cutting Costs? Keep Marketing
Bill Gates once said if it was down to his last dollar, he’d spend it on marketing. In 2020, many businesses had to tighten their belts to accommodate the changes in the economy and are planning to continue doing so in 2021. Interestingly enough, the last time we saw this pattern in business spending was during the 2008 recession, and we defended marketing then, too.
Why You Need Marketing in Financially Hard Times
Marketing Equals Revenue
Did you know research shows a company’s marketing budget can be directly tied to their gross revenue? While marketing budgets are often the first slice of the pie to be slimmed down, it's really not in your business’s self interest. If the aim of budget cuts is to increase your profit margin, then cutting the marketing budget won’t accomplish the goal.
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Take Advantage of an Empty Market
If you’re feeling the urge to pull back on marketing, then you’re probably not alone. Other businesses will likely be reducing their marketing budgets, and you can take advantage of this oversight. It’s basic marketing economics - there would be less demand for marketing space but the same supply, meaning the cost of marketing will go down. When this happens, you can jump on the opportunity of new marketing channels previously dominated by your competitors. By looking at your overall marketing strategy and evaluating what works and what doesn't work, you can effectively shift money from non-producing strategies to strategies that produce results. Go against the grain by focusing heavily on marketing instead of looking at it as purely as an overhead expense.
Shifting Your Marketing Dollars
If you think you can rustle up a few more marketing dollars, then maybe consider pursuing new marketing channels. At the very least, you should be examining where your marketing efforts are producing the strongest results. Some of these strategies are email marketing, search engine optimization, and pay-per-click advertising. If you currently have funds allocated toward marketing strategies that are not producing what you had hoped, think about reallocating your money to the above stated strategies.
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Budget-Friendly Ways to Stretch Your Marketing Efforts
If you can't seem to find those additional marketing dollars, you can utilize these simple marketing strategies to help effectively market your company:
- Customer loyalty programs
- Employee appreciation programs
- Content sharing on social media
- Online sales/commerce
- Customer incentive programs
- Outsourcing of non-essential functions
- Reallocate your marketing dollars toward strategies with a higher ROI
We said it in 2008, and we’ll say it again: When times are tough, don’t stop marketing. What feels like a protective maneuver can actually end up hurting your business even more. Be like Bill Gates and trust in the power of marketing.
By Jordan Latham