Why Marketing is a Critical Budget Item
Marketers sometimes find themselves in the unenviable position of having to convince people that what they do is necessary. Some executives see marketing as window dressing, so it’s the first budget item to get slashed when belts tighten in an economic downturn or a recession. That’s a big mistake.
According to a study in Harvard Business Review, marketing during a recession is just as important as marketing in prosperous times, if not more so. But there’s a catch — it has to be done much more carefully. From the article:
“Marketing expenditures in areas from communications to research are often slashed across the board—but such indiscriminate cost-cutting is a mistake … Companies that put customer needs under the microscope, take a scalpel rather than a cleaver to the marketing budget, and nimbly adjust strategies, tactics, and product offerings in response to shifting demand are more likely than others to flourish both during and after a recession.”
The fact is that marketing isn’t just a side effort to the more important business of creating and selling a product — it’s the entire reason your business keeps the lights on.
Marketing is Food, not Medicine
Inexperienced companies and executives tend to think of marketing as medicine — you don’t take it until something goes wrong, then start marketing, then stop the dose when the problem is fixed. Having trouble converting web page visitors? Prescribe a four-week course of marketing and see how you feel.
Instead, think of marketing like food — you need it every day, you start to suffer if you don’t get enough of it, and quality is just as important as quantity. Is your budget tight for this month? You can’t just stop eating to cut back. No matter what, your company needs marketing.
Coca-Cola is probably the most recognized brand in the world — in every country, on every continent, a red field with a white wave on it means the same thing. Yet Coca-Cola spends billions of dollars a year on marketing.
Small companies know how important it is to spend on marketing, too — if you ever want to get noticed, you have to get your name out there. It’s the companies in the middle that lose sight of the importance of ongoing marketing.
The Importance of Marketing
If you’ve ever picked one brand of olive oil over another because you like the look of the label, that was marketing. If you downloaded one piece of software over another because its website was easier to use, marketing gets credit for the assistance. The fact is, you’re marketing your product, whether you try to or not, by merely putting it out in the world.
So why do the most successful companies in the world — companies like Apple, Nike, Coca-Cola, and McDonald’s — spend so much on ongoing marketing?
If you stop telling people about the developments in your company, their impression of who you are and what you do freezes. Even now, if you took a survey of everyone who’s ever heard of you, you’d probably find that their impressions are years out of date.
That’s why Chevy has spent millions on ads where “real people” learn how reliable Chevys are. It’s why Dominos put so much effort into rebranding (to enormous success). And in a fast-paced digital world, it’s imperative to avoid falling behind.
Shaping Your Customer Base
The people who buy your product might not be the ones you thought you’d be selling to when you launched. As your company and its offerings have grown and evolved, you might find that you’re not selling to the same people in year ten as you were in year five. Ongoing marketing keeps the world abreast of how your company has changed so your customer base can evolve alongside it.
Keeping Demand High
As the saying goes, good enough isn’t good enough. Sure, you have enough business to keep things running smoothly at the moment, but what if you lose a big client? Can you fill that gap quickly? Ongoing marketing keeps leads coming into the top of the funnel so you can pick the best customers, grow when you want to, and have a safety net to fall back on if you need it.
Marketing isn’t just about getting business this month or this quarter — it’s about planting the seeds for next year and the year after that. Your future is uncertain no matter what you do, but marketing can help lay the groundwork for future success.
Analogous to daily sustenance, marketing is a necessity that should never be relegated to the status of a remedy for problems. It’s an ongoing commitment that fuels brand recognition, shapes customer perceptions, and keeps the demand for your products or services consistently high. Leading companies worldwide, from Coca-Cola to Apple, understand the enduring value of marketing, investing substantial resources to maintain their market presence. For businesses of all sizes, the importance of marketing lies not only in the present but also in its ability to shape a resilient future and adapt to the evolving needs of both the company and its customers.