Is the worst recession over for marketing?
Apparently, there could be some sunshine with blue skies in 2010. This is a welcome relief for many of us, compared to the last time we blogged about marketing budgets. In a recent Mediapost article that highlighted a poll by ANA, it seems that the worst of budget cuts are in the rear view mirror. This doesn’t mean that budget cuts are not happening, just not as drastically. Here’s what’s the survey shared:
The majority of marketers forecast no change in spending for the first half of 2010:
- 59% think budgets will stay the same
- 22% think budgets will be reduced
- 19% are hopeful budgets will increase
This sounds most promising, but it doesn’t paint the whole picture. That’s why we must look at other data points in the survey:
- 41% of respondents are planning to reduce marketing budgets by 1-5%
- 70% plan reductions of 1-10%, up substantially from 55% in the July 2009 survey
- Only 7% plan reductions greater than 20%, which is down sharply from 30% in July 2009.
This sounds more realistic. So what does this mean? That most marketers are working towards a “New Normal” and are looking to squeeze another 10% out of the bugdet this year. That’s not as bad as it sounds, and is more typical for budgeting processes in general. I don’t know about you, but when I was on the corporate side, reducing the budget by 10% was normal fare. I did it kicking and screaming, fighting for every last dollar, but it gone done.
So where are the cuts happening?
The top four ways marketers are reducing costs and spending:
- 75% are challenging agencies to reduce internal expenses and/or identify cost reductions
- 73% are reducing departmental travel and expenses
- 53% are reducing advertising media budgets
- 50% are reducing advertising production budgets
Any of this a surprise? Not to us either. And I’m not sure travel will ever go back to what it was, especially with all the tools we have to virtually connect with our customers.
The silver lining we are seeing, even without the ANA survey, is that things are relaxing a bit. People are looking to be more innovative, creative and want to find a way to stand above all the deafening noise that has been created with social networking. And that’s the stuff that gets us jazzed up – creating new, innovative ideas that inspires us and others… We’re moving away from the same old, groundhog-day marketing programs….and we are one more seasoned year into using/evaluating social media so it’s not about the hype, it’s about the practicality and usefulness to business. 2010 marketing is more about integration and less about the tools….
What are you seeing at your company?