As I noted in my post To Cut or Not to Cut?, this is a smart time
for most companies to reduce marketing spend, notwithstanding desperate pleas
from marketing services providers that you double-down in the downturn.
Is there a smart, systematic way to do this?
Probably, but it's elusive, as confirmed by the many stories I hear of
the across-the-board, arbitrary 10%, 15%, 25% cuts many marketers are trying to
cope with.
A recent white paper from former colleagues at
Deloitte Consulting prompted my writing this post, so let's look at their
approach, which they call Structural Cost Cutting.
The premise of the Deloitte's Structural Cost
Cutting is that the big opportunities for big near-term reductions in spend
come from challenging basic assumptions about the business and how marketing
supports it. The savings will emerge from multiple categories of
marketing spend. The Deloitte hit list of areas to examine are:
Continue reading "Topgrading Marketing Spend" »
As has been in the case during every downturn I've lived through as a professional (this is my third), many observers of the marketing discipline are quick to remind us that "studies show" successful companies increase advertising spend during downturns and reap great rewards from having done so during recoveries. Of course, those most emphatic in offering this counsel are those peddling media and marketing services.
One of many possible examples can be found in a September blog post by John Quelch offering advice on "How to Market in a Recession". Quelch is a director at WPP, so there may be some bias when he counsels: "Maintain marketing spending. This is not the time to cut advertising. It is well documented that brands that increase advertising during a
recession, when competitors are cutting back, can improve market share
and return on investment at lower cost than during good economic times."
Even though we also peddle marketing services, I question the wisdom of this line of thinking. More to the point, we need to be mindful that what was true in the past may not longer hold.
What's different now?
Continue reading "To Cut or Not to Cut?" »
