Data Proof: Why Slashing Marketing Budgets Is A Bad Idea Right Now

Share this post

There are many things to think about as we not only prepare for a return to business but also face the prospect of a prolonged recession on the near horizon. As well as preparing for the immediate future, there are sales and marketing activities you can and should be doing now to prepare for next year: especially relevant if you work in sectors with longer sales cycles, like travel.

While it’s tempting to cut budgets, the marketing budget is absolutely not the one to slash: marketing is essential for business resilience and recovery, and now more than ever, you need to be doing everything you can to ensure that your business can weather the storm.

As Mark Ritson argues, brand equity and marketing investment will put you in better shape for the recovery, because advertising has both short-term and long-term impacts. Those who cut back on ad spend leave their competitors with a greater share of voice, which in turn will nudge market share higher. In recessions, as the category reduces its ad spend, a brand only has to maintain its existing spend level for an opportunity to grow market share.

So how to go about selling?

The COVID-19 pandemic has forced us to reassess how we approach our sales and marketing activities. Organizations that previously relied on a physical presence have had to become more creative, as they’ve moved from store-based retailing to being entirely online; ensured that support calls are answered when call centre staff are working from home or continued to manage the business when employees are furloughed.

But, crisis or not, marketing never stops. Moreover, how brands behave in a crisis has an incredible power to engage an audience: opinions are paramount. Does this extend to outbound communications? Can a brand sell during this crisis? Absolutely, because life goes on, even if it is radically altered.

Having said that, sales and marketing activities still need to be carefully thought through and should at all times be ‘crisis cognizant’ (there are, sadly, quite a few examples of brands who have put a foot wrong during this time with some ill-considered marketing). Nor should one blatantly continue to sell as if nothing has happened, as this could well damage brand image. Brands must expand their empathy and put themselves in their customers’ shoes to understand how they are feeling and adjust their activities accordingly.

Choose your channels carefully

According to a recent Havas Media report, 54% of customers prefer brands to communicate virus-related issues via traditional media rather than social media.

Take advantage of all the available channels open to you and those that you might not have considered before. Both email and direct mail are currently working well. HubSpot’s regular sales and marketing email trackers have found while sales teams are sending fewer emails, email engagement continues to grow slowly: sales emails are still 39% above the benchmark, and email engagement has increased 3%, continuing its slow but steady rise since late April. Marketing email open rates have remained largely consistent and are still trending 15% above pre-COVID levels. Email volume still remains far above the benchmark at 26%.

HubSpot has also found that all of the industries it is tracking are trending above pre-COVID levels, except for travel which seems to be sending fewer emails compared to the rest. Anecdotally, however, we have heard of travel firms taking bookings from emails being sent out about holidays in 2021 and 2022.

Direct mail also continues to be a strong channel. Recent research shows that two-thirds of small businesses still use traditional marketing methods. Direct mail has many advantages: it’s highly valued by customers thanks to the fact they can see and touch it; it creates a genuine two-way relationship, and it can influence how the recipient feels about the sender. 

Find your best prospects

As lockdown has continued, buyers are increasingly seeking out and interacting with businesses. This is partially due to the fact that stay-at-home orders and business closures have moved many transactions online out of necessity, but it shows that for now, buyers are still looking to engage.

In fact, buyer engagement has never been higher, but sales are not increasing in the same way. This suggests that sales teams are targeting prospects that are not a good fit. The wisest sales teams will be putting high-interest, good-fit buyers at the top of their prospect list, rather than wasting time, effort and resource prospecting indiscriminately.

Use your customer data to find your top prospects: create profiles of your key segments, based on clean data and your pre-defined profiles. Use this to create a cold data file of new, bespoke, top prospects to contact by direct mail and add in emails, with a corresponding email file plus an email broadcast to anyone with an opted-in email address.

Communicate with care

It has never been more important to read and understand your customer base and prospects. Some people have shifted to working from home for the first time: what do they need? How do you tailor your messaging to ensure it remains relevant, without being overbearing? The bottom line is that it should be sensitive to the changed circumstances that everyone is experiencing.

Identifying vulnerable customers is crucial, so look for a data partner who can help you identify who they are. Communicating with care needs to be the new marketing mantra for the ‘new normal’. Not only should you be mindful that people have died, but also that many more are vulnerable. It’s important to use data responsibly to decide how to communicate with individuals and by doing so, instill responsible marketing practices at the heart of everything you do.

There is no doubt that this pandemic will change the world forever, and it will have a lasting impact on how consumers view brands. Those that transition from sales-first to a consumer-first approach are much likely to bring their customers with them. Make sure you’re not one of the ones to be left behind.


Share this post
No Comments Yet

Leave a Reply

Your email address will not be published.