This spring, every marketing organization across the globe stepped back and reevaluated their plans. After cancelling any in-person events and direct-mail programs, we all had the same thought: “where are these funds going now?”
Marketing never sleeps – even during an economic crisis, marketers are tied to the mandate of moving the needle and driving impact for their organization. And now we’re doing it in a constantly fluctuating market with shrinking budgets. How limited are our resources? 65% of CMOs and marketing leaders are bracing for moderate to significant budget cuts according to Gartner.
How do we continue achieving results with different or fewer resources? We work smarter, and that begins with our investments. We have six tips for how to manage marketing investments during a crisis.
Tip #1 – Play Within Your Limits
Before making any investments, know what you have to work with. It’s more than likely marketing will be given a smaller portion of the company’s budget for the quarter. Once you have your final number from your CMO, factor in your fixed costs before making any new investments. These could be subscriptions, retainers, prepaid agreements – any regularly occurring cost needs to be subtracted from your new budget. The remaining funds are your playground.
Tip #2 – Alignment is Crucial
As you look through the list of possible investments this quarter, decide which ones are aligned to company goals. Marketing should always use company goals as a North Star to direct their activities. If not, they run the risk of pursuing goals that are at odds with corporate goals and fail to justify the positive impact they made to the business. Marketers end up pursuing marginal activities and fail to concentrate on programs that drive more impact. In a regular quarter this is risky, but in this climate it’s downright dangerous.
Tip #3 – Invest in the Best
COVID-19 and the ensuing global economic crisis exposed deeply buried (and some not so deep) issues within marketing budgets and processes. Nothing broken magically fixes itself, and now it’s time to set that right. Think about which technologies your marketing team currently needs to bring it to the next level, because that’s where we all need to be performing right now. For example, how long did it take to sort out your budget in the wake of COVID-19? Is it still being organized because budgeting is done in siloes and multiple spreadsheets? If that sounds familiar, now is the time to think about a better financial management solution or a Marketing Resource Management (MRM) provider.
Tip #4 – Be Prepared for Multiple Scenarios
Plans are changing quickly and at any moment you may need to pivot to plan G. Although you have no control over the current market, you can constantly arm yourself with a back-up plan. Categorize all of your investments as high, medium, and low risk. Think of back-up plans for each, with more than one replacement scenario for high and medium risk situations. A great place to start is imagining that your budget gets slashed by 10% – what would you do differently? Are there alternative activities that can create a similar impact?
Tip #5 – Diversify your Portfolio
In a regular quarter you would never devote your entire budget to one area. Even though digital ads seem appealing – or like the only option – resist the urge to invest everything in them. Be creative and think about other avenues! Webinars are a great virtual option that hasn’t changed. Do you have the resources to do a webinar workshop or half-day virtual event with various guest speakers? What content have customers and prospects been engaging with recently – can you build on it? Or has evaluating your assets revealed a gap in your content strategy that you now have time to fix?
Tip #6 – What’s the Return?
We’re always thinking about ROI, we can’t help it – it’s who we are as marketers. But measuring ROI in the middle of a crisis is really difficult. Historical data doesn’t account for the context of the situation, so there aren’t any appropriate benchmarks. The best your marketing organization can do is create A/B testing as you go, or build in control tests and use those to measure lift as the weeks pass. Don’t forget to balance your activities between ones with short-term results and those that lay the foundation for long-term success. Quick wins are great, and absolutely necessary in this climate, but eventually this storm will pass and you need to prepare your organization for getting back up to full speed.
It’s impossible for marketing to stop spending in order to do their job, so we must be extra critical about where we are spending. A streamlined and smart investment strategy is the key to optimizing limited spend this quarter. With these six tips, you’re on the right track to create an agile and impactful marketing budget.