Marketing Budgets Archives

In News

How can brands defy recession? By increasing marketing budgets

February 8, 2023 No Comments

In 2023, the looming recession hangs heavy in the air while departments analyse row after row of resources, projects, talent, business development initiatives, and future campaigns.

The knee-jerk reaction for any chief financial officer prepping for economic disruption is to find the line item under ‘marketing’ and start cutting from there. But as chief operating officer at my agency, I decided to not let fear of uncertainty guide our organization. I gave the directive to increase our marketing budget for 2023. I believe that by harnessing the power of marketing and allocating that increased spending wisely, brands will defy the recession.

Making marketing a priority during a recession

One needn’t search far to find data showing how much better brands that increased their marketing spend during a recession fare compared with those brands that cut back or eliminate it. An Analytic Partners report found that 60% of brands that increased media spend in the last recession saw a greater return on investment; those that spent more on paid advertising saw a 17% increase in incremental sales.

With competitors making cuts, the marketing environment shifts, offering more real estate for advertising. Brands can leverage the availability and lower ad costs to increase awareness. Maintaining your share of voice in the marketplace is much easier (and cheaper) than trying to earn it back. Take it from the marketers at Reckitt Benckiser, which launched a campaign amid the 2008 recession. “Reckitt Benckiser actually grew revenues by 8% and profits by 14%, when most of its rivals were reporting profit declines of 10% or more. They viewed advertising as an investment rather than an expense.”

But it’s not enough to simply increase (or maintain) a marketing budget during a recession. Brands must look to use that marketing spend wisely and allocate it to programs that will drive results. Here are four areas that will prove ROI.

1. Brand building

This is especially important in the B2B world. There has never been a better time to create and celebrate a brand purpose. Usually, a field that was dominated by B2C brands like Apple, last year’s FutureBrand Index (an annual perception study of PwC’s Top 100 companies based on brand perception) ranked four B2B brands in its top five. Maintaining a focus on brand building supports long-term sales through ongoing awareness and perception.

2. Customer retention and loyalty programs

Generating new business leads is always important for the growth of any brand. But customer experience can play a major role in strengthening customer retention – another source of demand through cross-sell and up-sell opportunities. As an added bonus, loyalty programs help increase brand trust and develop reliable customer data.

3. Digital transformation

Recession or none, digital transformation will keep on with its steady (and speedy) growth. To keep pace with B2B buyers’ demands, businesses will need to invest in e-commerce solutions, personalization and strong martech stacks to meet buyers at every step of their journey.

4. Talent acquisition and retention

Finding and keeping talent on board is key to surviving any recession. Marketing can play a major role by using existing marketing channels and strategies to recruit and re-recruit. Businesses need to think about how to best engage with the talent through channels, platforms and messages. Marketing can help create campaigns that attract qualified talent. Once that talent is found, retaining that talent is supported by living the brand values and purpose at every stage of the employee’s journey. Invest in training programs that provide up-skilling and professional development.

Recessions do end. Times can be uncertain, but we’ve weathered recessions before and even navigated a global pandemic. Investing in a brand’s growth for the long term requires an investment in brand awareness and strategic allocation of funds. If done thoughtfully, business leaders can experience a recession as a tailwind, instead of a headwind.

Feature Image Credit: Ibrahim Rifath via Unsplash

By Nathan Ulery

Sourced from The Drum

In News

Here’s how Covid-19 has changed media for publishers and consumers

October 30, 2020 No Comments

By HANAA’ TAMEEZ

Going into month eight of the coronavirus pandemic, we’re just beginning to understand the long-term impacts that the global event has had on news publishers and how they’re charting a sustainable path forward.

A new report at What’s New In Publishing, “The Publisher’s Guide to Navigating Covid-19,” looks at eight trends that have emerged globally, as well as strategies that publishers have implemented as a result of increased web traffic.

The report’s author, journalism professor Damian Radcliffe at the University of Oregon, notes that it’s difficult to make broad conclusions about Covid-19’s impact. The pandemic has forced some publications to lay off or furlough staff or shut down completely. Others publications, though, have been able to capitalize on increased reader attention and boost subscriptions.

Radcliffe looks at what we know now about the media industry so far, though even more could change in the United States as we inch closer to Election Day and watch President Donald Trump’s recovery from coronavirus. Here are some findings:

Smaller marketing budgets worldwide means advertising-dependent publications will have to pivot if they haven’t already. According to PwC’s Global Entertainment and Media Outlook report for 2020–2024, “global newspaper advertising (print and online) will fall from $49.2 billion in 2019 to $36 billion in 2024, a decline of more than a quarter (27%) over five years…[Alongside this] global circulation and subscriber revenue is expected to fall from $58.7 billion in 2019 to $50.4 billion in 2024,” Press Gazette reported in September.

People are spending a lot more time on their devices, but media consumption has fallen off after an initial surge. Smartphone usage is up 70%, laptop usage 47%, and tablet usage 23%, according to data from the Global Web Index’s Coronavirus Multi-Market study. For DataRePortal, Simon Kemp wrote, “many people say that they expect their new habits to continue after the Covid-19 outbreak passes too. One in five internet users say they expect to continue watching more content on streaming services, and one in seven (15%) say they expect to continue spending more time using social media.” All media, however, from internet surfing to TV watching, has declined since the initial surge in April. That means that news publishers have to get creative about gauging audience interest, and keeping it.

With more new readers, publishers are experimenting more with news products. At the beginning of March, we noticed that publishers were quick to launch coronavirus pop-up newsletters and drop their paywalls on pandemic stories. According to members of WAN-IFRA’s Global Media Trends Panel, more than half of the editorial executives they surveyed had launched new products as a result of the pandemic, Radcliffe writes. “Newsletters are the most common product, with some 55% saying they have launched them, followed by infographics (49%), and videos and live blogs (30%).”

Covid-19 has helped boost subscription numbers for a range of publishers. With advertising revenue down, publishers have leaned into reader revenue and membership programs to fill the gap. More and more publishers are explaining to readers why their journalism should be paid for and they’re doing so on various platforms, including YouTube and Facebook. Some success stories Radcliffe notes are:

The New York Times now has more than 6.5 million subscribers (print and digital), adding 669,000 digital subscribers in the second quarter of 2020. In March, nytimes.com had 240 million unique visitors and 2.5 billion pageviews, up from 101 million uniques in January.

CNBC’s website hit 1 billion page views for the first time in March 2020, more than doubling traffic from February. Subscriptions to CNBC Pro, a premium product costing $29.99 a month or $299.99 a year, were up 189% since January 2020.

Tribune Publishing experienced a 293% increase in new digital subscriptions between March and February 2020. This included an increased conversion rate, from users hitting the paywall, of 109%.

Radcliffe also looks at audience engagement strategies, building loyalty among readers, and the ways that publishers have tried to be more accommodating to advertising. Read the full report here.

By HANAA’ TAMEEZ

Sourced from NiemanLab

In News

Have Marketers Given Up On The Job Of Keeping Customers?

May 29, 2020 No Comments

By Paul Talbot

When customers are taken for granted, they have a knack for vanishing. So it seems strange that as we move into an era of vanishing, or at best, shrinking marketing budgets, attention paid to existing customers appears to be eroding.

I recently asked Lana Busignani, EVP of U.S. Analytics at Nielsen, to shed light on recent research which reflects the waning importance of marketing built to keep current customers active and engaged.

Paul Talbot: Survey respondents indicated, by a fairly wide margin, that acquiring new customers was more important than retaining existing customers. Do you have a sense as to why?

Lana Busignani: One potential explanation is the distortion of attention and energy to mastering the capabilities being enabled by the digital, addressable world. The growth and sophistication of the digital advertising ecosystem has enabled marketers to target audiences and buyers more precisely with the objective of converting interested/engaged buyers within the category to their brands.

Talbot: Little interest was expressed in reducing churn. The report states, ‘This lack of focus on churn is a missed opportunity for marketers.’ Can we quantify the size of this opportunity, and why doesn’t the tactic of reducing churn generate the focus you believe it should?

Busignani: Perhaps some may be chalked up to how marketers define churn, whether they are concerned with it or not. Is it a completely lost buyer, a lost trip to a competitive brand, or a reduction in brand loyalty? Any lost sale should be considered churn and for consumer brands could drive a 10-20% reduction in sales among current buyers which would need to be offset by new client acquisition or switchers from competitive brands.

Marketers should balance client acquisition with activities that remind buyers about their brand and keep their brand top of mind for when consumers are making buying decisions.

One potential explanation as to why reducing churn is rated lower among marketers, is that some marketers have adopted philosophies which prioritize penetration and brand popularity over activities designed to drive brand loyalty or customer retention. The philosophy accepts consumer switching and lack of loyalty as a dynamic prevalent in the marketplace and so these marketers focus their activities on driving new buyers and penetration among consumers.

Talbot: Do we have any historic context for these viewpoints? Do we know if customer retention and reducing churn was any more or less important to marketers ten or twenty years ago?

Busignani: While we don’t have historical figures to cite as our CMO survey is only a few years old, there is evidence to support that customer retention was an important priority for marketers in the form of loyalty programs which proliferated during that time frame.

Markets were also less fragmented at the time, with fewer competitors and consumer choice so perhaps retention, or protecting established share of wallet was more achievable for marketers or was considered a more worthwhile investment than it is today. We do see great examples of modern loyalty programs designed to drive customer retention with the proliferation of apps designed to offer convenience and rewards to consumers such as Starbucks and Target’s shopper app.

Talbot: The classic marketing rule of thumb that suggests an investment in creating a new customer is greater than an investment in keeping an existing customer. Has this been relegated to the quaint thinking of a bygone era? What do the media investment numbers actually reveal?

Busignani: Marketers are under increased scrutiny to prove the value of marketing investments in driving growth for brands to justify marketing spending.

Given the amount of wasted marketing dollars, reaching wrong audiences with irrelevant messages, products and offers, we do see marketers increasing investments in new digital ad vehicles which offer the promise of growth and the ability to reach consumers with relevant, personalized offers.

Traditional vehicles like television, which reach broader audiences, are more difficult to tie to sales outcomes today. However, as television becomes more addressable, it will enable marketers to more directly prove the value of their marketing investments in driving consumer action and purchasing.

By Paul Talbot

Minus strategy marketing staggers. I am a somewhat reformed ex-media business executive, with tours of duty at AOL, CBS Radio, and Nationwide Communications. I’m a fan of F. Scott Fitzgerald, the Boston Red Sox, the Principality of Liechtenstein, fried clams, fog, and prices that end in the number 7.

Sourced from Forbes

In News

Smartly.io Research Finds Half of 2020 Marketing Budgets Will be Allocated to Social Media Ads

February 5, 2020 No Comments

Sourced from yahoo! finance

Marketers expect to invest heavily in social automation technology to streamline inefficiencies

Smartly.io, the leading social media advertising automation platform for creative and performance marketers, today announced new research outlining how retail marketers plan to spend their advertising budgets in 2020. Commissioned by Smartly.io and conducted by WBR Insights, the research arm of the eTail event series, the survey results indicate that social media advertising will be a primary focus for retail brands hoping to reach consumers where they are most active.

Smartly.io’s research revealed that 52 percent of retail marketers will spend more on social advertising than they did in 2019. Further, 50 percent of retail advertisers are planning to spend at least half of their annual marketing budget on social media advertising. With eMarketer estimating that U.S. digital ad spend would reach $129 billion by the end of 2019, Smartly.io’s data indicates that retail marketers plan to allocate nearly $65 billion to social media ads in the decade’s first year. When compared to 2019, 96 percent of respondents plan to bump up their spending on Facebook this year, while Twitter (56 percent) and Instagram (22 percent) also see healthy increases.

In terms of where retail marketers currently advertise, Twitter (75 percent) and Instagram (59 percent) fare well, but Facebook is far and away their favorite social advertising platform, with 96 percent adoption. In fact, 36 percent reported that Facebook is the platform they dedicate the most spend toward, and 41 percent say it also gives them the best return on ad spend (ROAS).

“The past decade put social advertising on the map for most retail marketers, and our findings indicate that it will only continue to grow in 2020,” said Robert Rothschild, VP and global head of marketing at Smartly.io. “Retail marketers recognize the value that social media ads bring to their campaigns, and they are focused on understanding which levers to pull to generate even more engagement and revenue. Capturing the attention of today’s consumer demands that advertisers tell stories that seamlessly blend with the organic content that their audience already consumes. Investing in visual storytelling enables retail marketers to connect with consumers on an emotional and highly relevant level. Shifting spend to story ads, diversifying across social networks like Pinterest, bridging the gap between performance and creative teams, and investing in technology to scale creative and deliver incrementality in ad performance are ideal solutions that will allow teams to work faster and smarter in the year to come.”

Although marketers see a positive return on their dollar, many admit that the process is often still too manual and inefficient to easily manage. Survey results showed that 83 percent feel that there is room for improvement when it comes to automating parts of their ad creation and deployment, and 66 percent do not use any automation technology. To reduce these inefficiencies, 39 percent of retail marketing teams indicated that they will invest in more robust social advertising tools in 2020.

Additional findings from the study include:

29 percent of retail marketers noted Instagram is the social network where they spend the most on social ads
Nearly half (48 percent) feel their performance marketing and creative teams do not collaborate effectively in all stages of the marketing process
61 percent say that their creative production and ad delivery involves manual processes that are often time-consuming
47 percent of retail marketers plan to increase their use of dynamic ads on social media
39 percent predict they will manage social advertising in-house
35 percent feel that their KPIs will change from how they were measured in 2019

Download the complete Smartly.io research report on our website. Smartly.io recently raised €200 million in funding in December 2019 to support future growth of the company. Visit Smartly.io’s website to learn more about its capabilities, and follow Smartly.io on Twitter for the latest updates on company announcements.

About the Study
In November of 2019, Smartly.io partnered with WBR Insights and eTail to survey 100 U.S. retail marketing decision-makers to understand their plans for social media advertising in 2020. Respondents spanned roles in brand marketing, eCommerce and sales, creative and design, product and performance marketing, and digital advertising, and gave their answers via phone call. All respondents were age 18+ and located in the U.S., and represented retail brands generating over $200 million in total annual revenue in sectors like apparel, home furnishing, hardware, electronics and appliances, specialty retail, sporting goods, department stores, entertainment and hospitality, supermarkets, and toys.

About Smartly.io
Powering beautifully effective ads, Smartly.io automates every step of social advertising to unlock greater performance and creativity. We combine creative production and ad buying automation with outstanding customer service to help 600+ brands scale their results – not headcount – on Facebook, Instagram and Pinterest. We are a fast-growing community of 350+ Smartlies with 16 offices around the world, managing over €2.5B in ad spend and growing rapidly and profitably. Visit smartly.io to learn more.

View source version on businesswire.com: https://www.businesswire.com/news/home/20200123005090/en/