It’s anything but business as usual, and companies need to learn to adapt to these recurring economic hiccups if they intend to survive.
The prolonged downturn. A sluggish economy. The Great Recession. However you choose to define the recent economic climate, it has left its mark on the optimism of corporate stability.
So when businesses both big and small began feeling the pinch, one of the first things they cut was the marketing budget. After all, the business axiom that you have to spend money to make money doesn’t always make sense when it seems nobody is buying.
Businesses and marketing departments can weather these storms by rethinking another axiom—business as usual—but also by leveraging what they are good at: creative thinking. It is this creative process that can ignite the next great marketing campaign and guide an effective collaboration between a company and its partners.
ROI or DOA
The nonprofit National Bureau of Economic Research says the United States has experienced five recessions since 1980; the most recent technically ended in June 2009. While the economy has gained some traction in the nearly three years since, many business leaders still lack confidence in the recovery. It’s anything but business as usual, and companies need to learn to adapt to these recurring economic hiccups if they intend to survive.
Marketers—whether they work in-house or at an agency—are legendary for generating big ideas, which often come with budgets to match. Yet without a clear indication of how any marketing campaign, large or small, is going to impact the business, it’s not likely to get funded now or when the economy bounces back. This is why return on investment is an absolutely critical starting point. Even projects where ROI is difficult to measure must demonstrate value, whether it’s in the form of lead generation, new partnerships and alliances, or discount and coupon opportunities with monitored redemption. While there is still a cost to doing business, it must come with a measurable ROI. Without it, even great ideas are likely to be viewed as dead on arrival.
For some businesses, even a clear return on investment isn’t enough. Parting with what little budget exists, or finding other reserves from which to make marketing investments, may not be possible. Solutions need to be innovative and show a high level of value.
Consider offering value-added counsel, strategies and guidance to execute a campaign with low- or no-cost implementation. As a service provider to businesses, guide the client’s internal team instead of employing the tactical implementation directly, which escalates costs. Or utilize trusted independent contractors.
Companies still experience the value of ongoing client engagement and benefit from a solid campaign that is affordable. But more importantly, everyone involved sees the advantage of strategically retooling marketing instead of allowing it to fall idle and letting the business lose market presence in a strained economic climate.
Chances are the competition is having these same difficult conversations and is likely to come to a similar conclusion: They can’t afford not to market their business in some capacity.
Instead of eliminating marketing altogether, define lower-cost, higher-impact initiatives that can sustain the company in the short term. Don’t be surprised if tighter, more focused initiatives prove to be more valuable than the myriad of marketing channels previously employed.
Risk and Reward
Most leaders understand the importance of calculated risk. Whether it’s launching a company or growing new markets, risk is inherent in running a business. But when it comes to marketing the company’s products or services, executives can quickly become risk-averse.
The key is to take calculated risk that provides a return on investment. This can manifest itself in many ways as well as new approaches. Social media could enter the mix, Internet marketing might invigorate Web traffic, or experiential marketing could “pull in” targeted audiences and engage customers face-to-face with the products, services or brand.
Regardless, risk means not being afraid of trying something new that has the potential to become the next big idea. It just requires calculating that risk wisely and weighing all the contributing factors of that decision.
The legacy of any company rests in its capable leaders. And the test of leadership, regardless of the role, is best defined during times of difficulty. The bottom line is everyone’s concern, and how to raise it to new heights is everyone’s challenge. Those bold enough to make creative but wise investments will be better positioned to experience the next inevitable downturn with their company and navigate it with even greater precision.
Jeff Milgrom is president and CEO of Event Marketing Strategies, located in the Brewery District. He can be reached at (614) 792-5600 or firstname.lastname@example.org.
Reprinted from the May 2012 issue of Columbus C.E.O. Copyright © Columbus C.E.O.