Don't Slash Your Marketing Budget To Shreds In A Recession — Use These 3 CostCutting Measures Instead.

© EmirMemedovsky |: Getty Images Emir Memedovsky |: Getty Images:

Not since Sam and Diane, Rachel and Ross, or Jim and Pam have so many desires, were they wrong. Of course, I'm talking about the fall. Even the Wall Street Journal doesn't know if we're there, heading there, or just missing it. Yes, we are seeing rising interest rates and inflation, but whether this is for the record books is still up for debate.

But the answer doesn't matter. Now is the time to plan for a recession, even if it doesn't come. Planning not only helps you weather the economic gloom of a full-scale recession, but it also helps you have a master book while reducing your marketing budget.

Frankly, the timing doesn't seem right for next year's budget. In response to Gartner's May 2022 CFO Survey, 39% of respondents said they would cut costs if inflation continued and the last quarter of 2022 turned out badly, and that's is the case. And CFOs aren't the only ones taking proactive steps. Major companies such as Google, Goldman Sachs and Wayfair recently announced slowdowns and layoffs, with Google laying off nearly 12,000 workers on January 20.

What about marketing, anyway? Are marketing teams destined to do more with less in 2023 and perhaps beyond? This is what it looks like. More than 4 in 10 marketers told Deloitte that they cut spending due to inflationary pressures. This is not shocking news. Marketing initiatives often feel the pain early on, especially when the word “recession” pops up. But it is a mistake that can happen to a company.

Without marketing, starting a new business is next to impossible. Of course, cuts can be made. However, they must evolve strategically if the organization is to succeed and perhaps even thrive during the recession.

As a Harvard Business Review retrospective of the three previous global recessions concluded, the 9% of companies that thrived had one thing in common: marketing strategy.

What are some effective marketing strategies for your business to protect your business from recession?

Related: It's Easy to Slash Your Marketing Budget in a Tough Economy, But It's a Bad Idea. Here's how to save money on your PR strategy.

1. Conduct a marketing strategy audit

Recession planning starts with understanding how fragile your marketing strategy is. Specifically, which marketing strategies will stop working as soon as you stop giving them money, and which will keep you going for a few more months?

Let's say you spend $10,000 per click per month and get 100 customers in return. The moment you stop your PPC campaign, you lose hundreds of potential customers. However, you can spend $4,000 to pay a company to take care of your SEO and get you on the first page of Google for a few keywords. If you stop working with this provider, you won't immediately see a drop in search engine rankings (although you probably will eventually).

This exercise helps you see the impact of reducing marketing costs in different countries. It's a good way to consider the long-term impact of each decision instead of deducting 5%, 10%, or 20% from your total tip. Anticipating the fundraising effect of any marketing effort today will help you avoid disastrous results later.

Related: Are you worried about the recession? Do this to prepare your business.

2. Bottom-up low-cost, high-return strategy

Once your team has performed an audit, review the data carefully. Which strategies provide the best ROI for your spend? These are the places to double down on when you're short on cash but want your plumbing flowing. Investing in the top performing areas creates a safety net around your brand.

A recent Wall Street Journal article explained that luxury marketers are using this strategy. For example: a wine retailer spends more money on marketing, but only on selected wines above a price threshold. It's the same principle that finds the greatest rewards in fully understanding what will generate the most revenue for your organization.

Maybe when you look at your marketing strategy, you find that your inbound funnel is the most fragile part. All you need is one guest post, six blog posts, one email per month. In exchange for this low-cost strategy, you get a consistent and predictable return on investment. Plus, you get content resources that can be repurposed and repurposed, saving you even more.

Related: Why a recession is the worst time to skimp on brand marketing

3. Catch up when your competitors fall back

You're not the only brand to understand how marketing works in a downturn. Your competitors will too, and you can bet your budget that they'll make mistakes and give you space.

Mark the movements of your competitors to see and evaluate them. Maybe a bigger competitor offered regular webinars but stopped or slowed down. Take note and consider adding webinars to your strategy to fill the gap in interested audiences. Don't immediately assume that webinars can't work because your competitors can beat them. Many organizations take dangerous actions when there is uncertainty.

It's your job to know your clients or customers well enough to see what they still need. Will your shopping habits change during the recession? But the more you understand how your target market is influenced, the easier it will be to tailor your marketing and messaging to deliver when your competitors don't or can't.

Some businesses cannot survive whether we are in a recession or not. The calculated recession planning practices you adopt today can help your brand grow stronger even when your marketing budget is drastically reduced.

What awaits the economy after massive tech cuts? |: Offline with John Favreau