Why You Shouldn’t Cut Marketing During a Recession

When economic times are tough, and sales are declining, you may be tempted to cut your marketing budget in a bid to save money. This strategy may yield some short-term savings, but when you scale back your marketing in a recession, your online visibility can take a major blow. You risk dropping off the radar of potential clients — and setting yourself up for a competitive disadvantage — by dropping out of the search results. Companies that need to reduce their budget should do so strategically, and prioritize sales-boosting marketing efforts.

The larger cost of cutting your marketing budget

When you’re faced with tough budgetary decisions, marketing can seem like an optional expense—it’s often the first on the chopping block. But your brand can take a big hit when you slash your marketing budget. As the Harvard Business Review points out, “marketing isn’t optional—it’s a ‘good cost,’ essential to bringing in revenues from these key customers and others.” And although it is often necessary to reduce spending during tough economic times, companies should resist the urge to gut their marketing budget completely. Companies “must take care to distinguish between the necessary and the wasteful,” when managing their marketing expenses, so they can continue to maintain and build a strong brand. 

You can weaken your presence in the market, especially online, by not being strategic with your budget cuts. Shifts in Google’s algorithm and a lack of fresh content can cause your organic rankings to drop over time, which creates a corresponding loss of organic traffic. Paid channels like digital advertising need an ongoing budget to keep your ads appearing online.

This lag can give your competitors the opening they need to edge you out of the market — especially during economic downturns when companies tend to pull back on spending. Cereal company Kellogg, for example, was able to grow its profits 30% and become an industry leader when it doubled its budget during the Great Depression. (Its main rival Post had previously been the “category leader in the ready-to-eat cereal category,” and had cut back on its advertising during the same time period.)

To maintain market share and stay top-of-mind for potential customers, companies need to balance the need to cut costs with the necessity of investing in marketing. That’s why it’s vital to prioritize strategies that boost sales when marketing in a recession.

Marketing strategies to boost sales

Although it can be tempting to pull back on marketing, there are ways you can optimize your existing efforts to increase sales in a more cost-effective way. You can keep your brand top-of-mind without blowing a smaller budget by prioritizing your spending. 

Define your audience

A necessary first step to prioritize your marketing is to make sure that marketing and sales are aligned. To work together effectively, marketing needs to provide materials that speak to customer pain points and drive qualified leads, while sales needs to have a reasonable close rate on those leads. When both groups know what is expected of them and uphold their sides of the bargain, it is easier for the company as a whole to predict the return on their marketing dollars.

Of course, in order to drive qualified leads, marketing first needs to understand who those qualified leads are. Defining this target audience is most easily done by creating a buyer persona, a “semi-fictional representation of your ideal customer.” 

Making an accurate buyer’s persona requires the use of existing customer data to better understand your customer’s demographics, interests, and pain points. You can pull this type of data from  Google Analytics and your CRM tool, or even interview your existing customers. The more you know about your customers, the easier it is to target other people like them and attract more qualified leads.

Not sure what to include in your buyer’s persona? A free tool like HubSpot’s Make My Persona can help you get started.

Refine PPC campaigns

After your buyer’s personas are clearly defined, you can re-target your marketing campaigns to focus on these high-value prospects. For digital advertising, this means refining both your target audience and ad copy to better drive conversions. 

Once ads are up and running, you can use A/B testing to find the most effective messaging and further optimize your performance. Companies can improve their clickthrough rate and lower the cost per lead by continuing to refine targeting and optimize ads.

With a little effort, your marketing team can potentially increase the number of leads even if they’re working with a smaller budget. You will want to make sure your Google Analytics is properly configured so you can track these efforts and determine your return on investment.

Focus on efficiency for SEO

PPC is not the only marketing channel that can be optimized on a lower budget. Even with limited resources, marketers can continue their SEO efforts with a focus on “quick-win” tactics that don’t take much time but can have big payoffs for your online visibility. 

For example, marketers who don’t have many resources to devote to new content creation can shift their focus to optimizing existing content instead. With a tool like Ahrefs Site Explorer marketers can identify content that currently ranks on page 2 of the search results, which are excellent candidates for optimization. You can tweak your content and help boost it to the first page of search results by updating the title tag, incorporating answers to frequently asked questions, and adding images.

Even if you’re already doing everything right when it comes to SEO, now is not the time to drop the ball. Continue to build on your optimization with regular assessment and tweaks. You can help stay at the front of the competitive pack with ongoing tasks like link building, on-page optimization, and the management of local profiles like Google My Business.

Question mark

Unsure where to start?

If you want to keep your marketing in-house, you’ll need to start by taking a close look at your goals, personas, and competition. This will help you identify the most effective digital marketing strategies for your company and begin aligning them with your budget. Our step-by step guide to digital marketing planning can help walk you through this process. 

Of course, not every company has the resources or expertise to take on all of the marketing themselves. Outsourcing to an experienced digital marketing agency can help you prioritize your SEO tasks, refine your PPC campaigns, and maximize your marketing budget.

When considering a vendor, look for industry expertise, recent case studies, and a strategy tailored to your budget and business goals.

At Pure Visibility, for example, our SEO plans include a proprietary Visibility Audit that reviews eight key areas of organic visibility and prioritizes our findings in an easy-to-follow checklist. This thorough audit helps us uncover technical issues that hinder your website’s ranking potential and identify the pages that would benefit the most from our efforts. One client, for instance, was able to improve relevant keyword rankings by 50% and steadily increase revenue — despite operating in a crowded online marketplace.

When it comes to PPC, our experts help you choose which platforms will be most effective for your message, market, and budget. Your accounts are managed by career experts (not an automated system) and monitored to maximize your ad budget and prevent lags in performance. We’ve helped many clients launch successful new campaigns or revamp existing ones that are underperforming; our work with Nuventra, for example, yielded a 500% boost in conversions in just five months. 

Contact us to discuss how digital advertising can help you reach your business goals.

Make the most of your marketing budget

If you slash  your marketing budget you are using a short-term solution that will only hurt you in the long run. But if your team works strategically you can prioritize your efforts to get a higher return — even if you have to be more careful with your money.

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