There’s a critical question on the minds of business owners and B2B marketing professionals everywhere—what will tomorrow bring?
One thing—and perhaps only one thing—is certain. You will awake with more questions. That’s okay. In fact, that’s how we move forward: by confronting each question and finding well-reasoned answers.
There is no playbook when it comes to an economic downturn such as the one we are facing right now. But there is a historical perspective we can look to. No, not great depression lore. We refer to modern-day, digital-age collapses that hold relevance today—the housing collapse of 2008 and the internet burst of 2000.
As marketing influencer and New York Times bestselling author Neil Patel said, “What I’ve learned from going through two crashes is that the best time to double down is when others are not.”
Yes, it’s only one person’s opinion, but it’s one we share with Mr. Patel. Having navigated the same economic turbulence, we also found that businesses that were aggressive fared better than those that opted to batten down the hatches and weather the storm.
Now we’re not advising every organization to opt for a full sheet into the wind approach. However, there are ways you can capitalize on this opportunity—and it is an opportunity—without risking your future.
“What I’ve learned from going through two crashes is that the best time to double down is when others are not.” Neil Patel
“What I’ve learned from going through two crashes is that the best time to double down is when others are not.”
Right now businesses are contemplating budget allocation. Especially marketing budget allocation. They are searching for ways to reduce costs while increasing demand. It’s a reasonable approach. With less coming in, logically, costs must be controlled. At the same time, with less coming in, more demand must be created to increase market share. Hence, we arrive at the economic downturn paradox.
Can companies achieve both?
We suggest yes. We also believe that given only one option, the best approach is to increase demand. Controlling costs is ultimately an effort in futility. Long term, no amount of cost-reducing measures can compensate for reduced interest in your offering. Therefore, at some point, you must attack the market and win your share. That can’t be achieved by silently holding down the fort.
Therefore, if you had only one choice, the path is clear. Luckily, you aren’t limited in your options. You can do many things at this moment. Use this flexibility to your advantage. Shape your organization into a leaner operating machine while working harder to feed your incoming revenue streams.
Why? Because your competitors will be doing the same thing.
If you want to know what others in the B2B world are planning to do, we have answers. A recent survey of more than 450 B2B marketers found that two-thirds of marketers expect their overall marketing budget to either stay the same or be cut moderately (by less than 20%).
That’s some powerful business intelligence. Not only is it timely, but it’s also informative. It shows that other organizations have intentions to continue investing in marketing and keep their message strong.
How will you respond when your competitors up their marketing efforts? Are you willing to lessen your marketing investment and gamble that incoming leads, sales, and profits won’t be impacted? Or are you interested in finding ways to continue your marketing efforts while making each dollar more effective?
That’s ultimately what this moment comes down to: not what you cut, but what you spend. The challenge is finding ways to make sure each dollar works harder and returns more on the investment. This is true for people, capital investments, and yes, marketing dollars. Maintaining the same spend is good. Maximizing the effectiveness of the marketing spend is better. In other words, cut the least effective allocations, but don’t cut the budget.
So you’ve decided to maintain your conversation with the audience because really, that’s what marketing is. An ongoing conversation of persuasion. But keep in mind that what you say is just as important as continuing to speak. And yes, you do want to continue speaking.
Looking back at the 2008-2009 recession, Les Binet and Peter Field found the following in their research: “Brands that took advantage of lower SOV costs achieved impressive business gains … they saw 5 times as many very large business effects (profit, pricing, penetration, etc.) and 4.5 times the annual market share growth.”
Maintaining the same spend is good. Maximizing the effectiveness of the marketing spend is better. In other words, cut the least effective allocations, but don’t cut the budget.
An economic downturn is not always the ideal time for hard-driving demand generation. Even if people still need what you are offering, they may be more receptive to a softer selling approach that shows awareness for the situation at hand.
That said, lead generation must go on. The key, and perhaps, trick, is reading the moment. You must work hard to understand your audiences’ position, mindset, and emotional state. Then, cater to it. Striking the right balance will of course bring about the greatest success. That said, the balance does not need to be perfect, merely sensitive to, or reflective of what’s happening at the moment.
Therefore, Olive suggests adjusting your marketing mix to balance brand awareness and lead generation. Let the audience know that you’re ready, able, and available. Remind them who you are and what you do. The goal first and foremost is to stay top of mind. That said, always be ready for business to accelerate forward. Situations can change quickly and the need to decrease brand awareness can shift rapidly. Lead generation must always be ready and waiting to go full speed ahead as normal.
Why the need to balance your approach during an economic downturn? When things are in doubt economically, the audience is less likely to adopt new ideas or processes. This makes it difficult to accomplish new product launches. Also, be wary of discounts, rebates, or sales. Anything too promotional could signal economic instability within your organization. Even if that is the case, present a steady image in your outward marketing. People are attracted to confidence.
If you do offer some form of pricing promotion, present it as a way to help customers. Cast the impression that you’re in a strong position and want to help others re-establish their economic strength. Right now, perception is everything.
An economic downturn is also a time to reconsider hosting lunch-and-learns or attending trade shows, conferences, industry gatherings, sales meetings, and other in-person events. Not only do these often carry significant marketing investments for your organization but they can also become costly for your audience to partake in.
Unsurprisingly, according to the B2B Marketing Zone Survey, 58% of B2B marketers say they will cancel all live events scheduled in the next 60 days, and 80% plan to cancel at least some events over the next six months.
When needed, you can hold many events virtually or in a modified manner. We’ve got a number of ideas and partners we work with to accomplish this. We’d suggest exploring options for reallocating portions of the live event marketing budget toward other efforts
Not only does holding off on events make smart financial sense, but it also demonstrates respect for your audience. Some people are ready to go 100% full bore back to the way things were just a few months ago. However, many are still uncertain and want to continue taking precautions. It’s wise to respect that. You don’t want to put any customer (or employee for that matter) in a position that they feel risks their health. It could be damaging long term to put an important customer or staff member in a position that makes them feel uncomfortable or negative about your organization. Be mindful, be respectful, and be accommodating.
Events will return in due time. Use this opportunity to explore what happens when events are not part of your marketing plan. You may just find the investment is better used elsewhere.
What are the best avenues for marketing expenditures right now? The answer will, of course, vary by client, industry, and audience. But there are some smart practices we can offer without knowing all of your details.
Wise marketing investments right now:
Put money toward closing customers that are near the finish line. This could include a number of strategies, but the ultimate goal is to target those customers that can bring the most immediate revenue.
Adjust existing marketing campaigns and efforts to make them stronger and more effective. Analyze placement, message, investment, and conversion. Use data and tweak factors to optimize performance.
Don’t get trapped in the short term, immediate reflex actions. Look ahead, make marketing investments that will reap benefits for months and years to come. These include search engine optimization and website enhancements to improve user experience, accessibility, and content strategy. This is a moment to build a better platform for your brand, message products, and services.
In most cases, these will deliver the most immediate results while also being the most measurable, allowing you to protect the effectiveness of your investment.
While it feels like an eternity, a momentary economic downturn is exactly that—a moment. It will pass (they always do). The economy and business move onward. Things pick up and the numbers thrive again. Ultimately, we endure and come out stronger. Not by luck, but through our actions.
At this very moment in time, B2B marketing is being challenged. Budget allocations are in question and for some, the viability of their business may be in doubt. Olive & Company is here for you.
We want to help businesses survive this moment and thrive in the long term. Come, lean on us for analysis, strategy, and creative work. More than ever, it’s good to have someone you can count on.
Let’s connect and get your marketing moving forward.