As recession begins to bite hard, ‘spending’ is the watchword of the moment. While the government introduces financial initiatives designed to encourage higher spending, people and businesses are looking for ways to cut their budgets. Despite the recent reduction in VAT and government appeals to banks to increase lending, businesses can’t ignore the lower revenue figures as customers retreat in large numbers.
In times of financial uncertainty, a review of business operations will highlight those functions deemed non-essential or over-resourced. Historically marketing is usually among the first to be culled. It is not a well understood discipline and invariably its implementation is lacking. By and large, it is seen more as a cost centre than a revenue generator, working to bring new sales leads to the business. Properly conceived, planned and implemented marketing strategies can raise an organisation’s profile in the marketplace, in turn strengthening brand awareness and loyalty, all of which eventually leads to more customers and ultimately more revenue.
That said, here are a few words of warning. Cutting your marketing budget without thought to the business impact can be devastating. Experienced marketers know this but are under pressure to reduce spending nevertheless, and never more so than now. Conversely, there are those organisations that hold marketing up as one of the tenets of business success in all weather. These are the companies that believe if you throw enough money at marketing, eventually more customers will come and the coffers will start to fill. But without a plan behind the intent, this approach is simply a waste of money and potentially fatal to the business. There is another way.
It is accepted wisdom that marketing is essential to a prosperous business. But is it possible to maintain marketing effectiveness on an ever-decreasing budget? To answer this question, we first need to understand three things: what exactly is marketing these days, why is it so important anyway and how is it changing?
MARKETING’S EVER INCREASING IMPORTANCE
To the uninitiated, marketing is a synonym for a wide range of disciplines and activities that somehow fall into the same bucket: advertising, public relations, exhibitions, promotions. It’s true that marketing covers all of these and many others, but what actually is it?
Marketing is essentially project management in disguise and has already been functioning well through outsourcing for a significant period of time. The proliferation of marketing activity, widening supplier resources and the increasingly short term view of the role of the marketing director have all combined to create the right environment for outsourcing marketing from the strategic through the bottom line operational level.
As recently as ten years ago, certain businesses did not need to market themselves as we understand it today. Businesses such as estate agents, housing developers and banks simply opened their doors and customers would come to them, ready to buy. These businesses saw marketing as a way to rise above the competition, but there was still essentially plenty of business for all of them. However, as markets have fractured and changed, the competition has become ever more fierce and new business models are continuously being developed. On top of that, in the current economic climate it is these traditional pillars of the economy that are suffering the most.
In light of these circumstances, marketing has taken on a new importance. It has become paramount not just to business success but also to business survival. Brand presence in itself is no longer enough. It is continuous brand strengthening and communication through robust marketing strategies that forms the foundation.
Ultimately though, marketing is about understanding your customers and your market. What have you got to sell, who are you trying to sell it to, and what is the best way reach them? In addressing these issues, the successful marketing programme will cover market research, define the most appropriate channels to market and the most effective media to reach the right audience, and articulate why the market should buy from them. This last point is the cornerstone to success marketing, otherwise known as the ‘Unique Selling Proposition’
Having outlined what marketing is and why it’s so important, surely it would be simple enough to work out a plan and execute it. Unfortunately for marketers everywhere, this is easier said than done. Why? Because marketing is undergoing radical change.