Optimizing Marketing Spend During the Recession

Expensive must-have features of yesterday are today's can-live-withouts.

Marketing professionals think they know of the pitfalls of cutting back on research and marketing during a time of change in consumer attitudes and spending. After all, the perceived wisdom that I've seen in numerous articles and blogs is that companies that spend on marketing during a recession come out ahead as the economy rebounds.

Christian Shea, a marketing consultant in Philadelphia, tried to find the research that backs up this belief, and had a hard time finding much that wasn't 25 years old and that frankly made any sense at all.

His advice to his clients is what I would advise anyone in marketing in or out of a recession:

• Don't fight the futile battle of finding yesterday's budget
• Become smarter with what you have
• This means setting measurable campaign goals for each project.
• "Talk about the result first. If you can't confidently say you can launch a campaign within the allotted budget and achieve the desired result, scrap the campaign and move on to something measurably achievable."

Professor John Quelch of Harvard Business School also recommends ways to optimize the effectiveness of the spend. Many of his ideas adapt to print and digital media products.

• Since price elasticity curves are changing, consumers are more willing to postpone purchases, trade down, or buy less, so "expensive must-have features of yesterday are today's can-live-withouts"-and so you should make the stripped-down version (e.g., shorter subscriptions, fewer bells-and-whistles for b-to-b products) readily available
• Trusted brands are especially valued and they can still launch new products successfully
• Adjust product distribution to those channels which benefit from the downturn. As important as Wal Mart has been for magazine publishers over the last several years, for example, it has become even more important during the recession as consumers go there (and use the Web site for purchases as well.)
• Your vendors along the distribution value chain will feel the recession as much, if not more than you do. So to support these businesses, help them with their working capital as much as possible to share the risk of inventories, credit and financing.
• B-to-b customers prefer to see products and services unbundled and priced separately