Monika’s Musings

miscellaneous tidbits on marketing, advertising, and life in general

On financial crises and marketing budgets

February12

Interesting times we’ve come to live in, eh?

The hot topic is the financial crisis. From it follow different discourses, some fear, insecurity and a series of bad decisions taken by scared people… Employees are fired, budgets are cut. The bull’s eye of the target always seems to be the marketing budget. Cut by 20%, slashed in half or completely taken away – why do we need it anyway? Who would advertise in times of crisis?

Well, the smart companies will.

As I have mentioned to some people, Sergio Zyman is my idol. And this seems to be the perfect time for every marketing manager to reread The End of Marketing as We Know It and if possible to slip it to their bosses as well. In this book anyone looking for some argumentation can find a couple of pointers on how to defend their budget.

Here’s the two arguments with which I couldn’t agree more:

1) Every brand is dependent on trust and they especially need to maintain the customers’ trust in hard times. Now people are reevaluating their priorities, their spending habits and their way of life. The trust they have in the brands with which they are accustomed to be surrounded is somewhat shaken. For FMCGs the question becomes whether quality products are used or do they buy cheaper and somewhat questionable meat to make your favorite sausages for example. Banks – are they going to go bankrupt, is my money safe? Here’s where massive advertising pays off. Although people might be saying left right and center that they hate ads, subconsciously they register the fact that you have loads of money to spend on advertising therefore chances are you are not compromising on quality either.

2) Your competition expands greatly during crises. If you’re Coke, your main competitor seizes to be Pepsi, but rather becomes anything in the same price range. You have some serious cross-category fighting to do for whatever’s left in the customer’s wallet. And especially now every brand needs to aggressively remind its customers why is it exactly that they love this brand - and why they shouldn’t stop buying it.

So fellow marketing managers, do not surrender to the pressure, but go and defend your budget with all the persuasion skills you have. You won’t regret it.

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posted under Marketing
2 Comments to

“On financial crises and marketing budgets”

  1. On February 12th, 2009 at 12:00 pm Matt Hanson Says:

    Good writing. Keep up the good work. I just added your RSS feed my Google News Reader..

    Matt Hanson

  2. On February 12th, 2009 at 12:15 pm monika Says:

    Thanks, Matt!
    I am looking forward to reading your blog.
    Cheers,
    Monika

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