David Allen Ibsen has written a blog called Telling Tales: “Hey marketing guy, how much did you make me today?” It’s a short and sweet tale of his experiences as a consumer marketing manager in an advertising, sales-driven organization (cable channel). In this position, David is visited often by the CEO. The CEO asks almost daily, “How much money did you make me today?” and our hero, David, is always forced to reply “Not a penny, Larry.” While laced with humor, David could read the implied threat in the CEO’s question.
That’s the trouble with marketing. Results are rarely immediate and sometimes unquantifiable (although this is less often the case today than in the past). It’s why the marketing budget is the first to get chopped in an economic downturn. It’s the perception that marketing doesn’t deliver the goods like sales does. But cutting the marketing budget is a huge mistake. Numerous studies from the 1920’s to today reveal that companies that maintain or increase their marketing efforts during a down economy recover 40 to 200% faster than businesses that cut their marketing spending. In many cases, companies that cut marketing altogether never recover.
Instead of making cuts that could severely alter the future of your business, try doing the following:
- Maintain or increase your outreach. This will keep you top of mind while your competition cuts marketing spending and disappears from the radar. Even in tough economic climates, your services are still needed.
- Shift your marketing dollars. Review the effectiveness of your spending and tweak as needed to get a higher return on marketing investments.
- Embrace technology. You can increase social media exposure with a minimal financial investment. Keep in mind that social outreach will require investments of time, but when business is slow, your staff may have more time to support these efforts. Give thought to how Facebook, YouTube, foursquare, blogs, Twitter, etc. can help you.
- Think of marketing as a revenue generator. Without it, your sales team will have a much tougher time introducing your products and services to prospects.
As for David Ibsen, one morning he was able to answer his CEO’s question with “Well Larry, I spent a million dollars of your money on a party, and the sales team signed $6 million worth of deals at the event last night. So, I guess I made you $5 million.”