Times may be tough, but now is not the time to cut your media and marketing spend.
It may seem like an easy way to make some savings in this difficult economic climate, but it’s a short-sighted move.
It’s no secret almost everyone is looking to tighten their purse strings right now – businesses included.
Not only has Australia’s surging inflation rate led to a cost-of-living crisis, but it has also sparked widespread fears a recession is just around the corner.
As a result, business owners are looking at quick ways to reduce operating costs. And one kneejerk reaction may be a hasty slash of their PR and marketing spend.
A Small Business Loans of Australia survey of directors and decision-makers of SMEs last year identified common business expenses owners said they would cut as the economic outlook worsened.
First on the chopping block in the event of a recession? Contractors, freelancers and other outsourced professionals, such as PR & marketing agencies (17% of respondents). Reducing marketing spend was also identified as another popular way to cut costs (10%).
However, here are five crucial reasons why you should invest – not slash – your spending on PR and marketing during an economic downturn.
- Retain your customers: With the rising cost of everything from fuel to food, it’s likely you’ve had to pass on some costs to your customers. When your products and services cost more, brand loyalty becomes more important. How do you convince customers not to ditch you in favour of another business where they can save? You need to deploy a marketing strategy to remind them of your point of difference so they’re happy to absorb the extra costs. Also, if you cut your marketing spend, there’s a real risk you will lose your market share to your competitors.
- Widen your customer base: Not only is it vital to try and keep the customers you have during economic headwinds, but it’s also equally important to attract new ones. The reality is some of your existing customers will likely drop off as they rein in their own spending, so you need to widen your appeal. How do you do that? You increase your brand awareness by investing in marketing and PR strategies. You need to be seen, be heard and be bold.
- Take advantage of less competition: With other companies potentially reducing their marketing and PR spend, there may be less competition for advertising and media opportunities. This means advertising, such as digital ads charged per click, may be cheaper, and you could also have more chance at landing a proactive media story.
- Appeal to top talent: Although we are teetering on the edge of a recession, the competition for talent in the Australian job market is still fierce. What companies are more likely to attract the best talent? The ones who have invested in marketing and PR to create a strong brand people would love to work for!
- Boost your brand: At the risk of sounding like a broken record, we’d be remiss not to really drive home the fact that investing in marketing and PR is crucial for your brand. If you cut your budget in these areas, then the momentum you’ve been building around your brand grinds to a halt as your brand awareness drops off. This means you’re going to be on the back foot when you decide to start spending on marketing and PR again.
Now for a final bit of advice. While now is not the time to cut your marketing and PR budget, it’s certainly the time to optimise your spending in these areas. As talk of a possible recession continues, take the time to evaluate your overall marketing and PR strategy. Track your data and, as needed, fine tune your approach to ensure you are getting the best bang for your buck when it comes to marketing and PR.
Need help with a marketing and/or PR strategy but not sure where to start? Get in touch with our seasoned PR pross and experienced marketers here.