Almost daily we see media coverage of potential downturns or various bubbles bursting. Whether or not another Great Recession is headed our way, 2016 is looking like a year of uncertainty. The US election, the UK’s EU Brexit referendum, the crisis in the Middle East, oil, China’s volatile stock market – there’s plenty of disruptive factors right now. Never a good thing for economic and business confidence.
As marketing and communications professionals, history tells us that when a recession rears its ugly head, it’s our departments that are the first to be cut. However, have things changed? Should the marketing community be more confident these days that our budgets are safe if a recession or downturn appears?
I think the answer is yes.
At LEWIS Futures Forums events held in San Francisco and San Diego in February 2016, we polled senior global marketing decision makers on this topic.
In terms of how a marketer in 2016 would respond to a recession, a third said they would expect to increase marketing spend. Another third said they expect it to be business as usual. Fifteen per cent said it was likely resources would be diverted into R&D. Meanwhile, a cautious fifth are reaching for the rope to firmly batten down those hatches.
Overall, those surveyed were fairly confident. But should they be, given the track record of marketing budgets and recessions?
According to Mike Banic, VP Marketing at San Jose, CA-based Vectra Networks, the answer lies in the rapid development and accessibility of marketing automation tools.
“At the time of the last recession in 2008, sophisticated marketing automation tools were not readily available. Often the price point was within reach of only the largest organizations. Today, marketing tools are highly sophisticated and because there is much more choice and better pricing, these systems are common place. Even your local florist is using a tool like HubSpot in its day-to-day business with customers.”
Marketing and communications has secured a different place and value since the last recession. We have the data, analysis and systems to prove that cutting marketing and communications during an economic downturn is a bad idea.
In 2008, marketers focused on activity. It was challenging to prove the connection to business value. Now, we have the data to exactly demonstrate business value and trace the contribution of marketing to corporate strategy and objectives. Data will act as the lifebelt for marketers when the economy gets into choppy waters.
2008’s single-layer email marketing solutions have given way to marketing automation platforms. These allow for more sophisticated execution, management and measurement of marketing campaigns.
These solutions are now tightly integrated with CRM technologies. This means measurement can carry through all the way from lead to close in a way that wasn’t possible before.
Google Analytics at the time was for specialists, not the general marketer. We had data, but the ease of analysis to demonstrate business value was out of reach to most.
Similarly, at the same time social media was still in relative infancy and very much a consumer plaything. Twitter was a celebrity tool Ashton Kutcher used to reach masses. Measuring social was not even an option.
Many saw tools like Hootsuite and Hubspot as a game changer bringing excellent measurement solutions into the hands of marketers in any size of organisation. Google and Facebook analytics are now used capably by marketing and communications generalists.
We could even say that 2008 was before content marketing became a serious marketing strategy. Now, the value of content we are creating has never been more important. In the last decade, it was difficult to prove the value and direct impact of content. Now we can track and report back on the value and contribution of content across every channel and platform that an organization uses.
Mike Banic agrees that data is the key to weathering the storm of any potential recessions: “I can tell the board how many inbound web visitors we had from reading articles online or engaging in social media and then linking to the website. When we publish blog posts about threat research, we can track a huge spike in web visits. I know exactly where people are going after reading the blog.
“The most important aspect is to be able to track the customer journey. There are so many great tools today to build pathways or journeys through digital content. For example, what content resonates at what part of the buying cycle, where are you in your journey. It’s very simple to associate calls to action in digital outbound activity.
“In our weekly sale and marketing team meetings, we review leads by channels, like inbound web queries, content, social media, how many leads turned into meetings. We analyze what lead sources work or not. This gives me the ability to make brutal decisions about where to make investments, and where to reduce or stop.
“This level of insight was non-existent at the time of the last recession. The quality of the data I regularly provide to the board basis proves the exact value of marketing and communications.”
Cutting down on marketing and communications is no longer an option during a recessionary period. Organizations would lose the insights and analytics to help improve the business when it needs it most. What operational improvements would be needed to help get an organization through a tough economic period.
If there is a positive we can take from a potential recession this year, it’s that the marketing community need not fear the axe being wielded. We have no excuses to not be confident about delivering and demonstrating business value. Because the data is out there. And all of us bar none have the means to show this to the board, month in, month out, rain or shine.
Image Source: Will Jackson