In periods of recession there are two budgets that traditionally get cut – training and marketing.
The argument that always goes back to the Finance or Managing Directors is that by cutting either of these budgets, you are damaging the company’s ability to move forward. If you cut the training budget there is a good chance that the quality of customer service will slip. If customer service slips, customers generally go to another provider of your service or product. If you cut the marketing budget, how do you effectively talk to your current and prospective customers to maximise your profitability?
Sometimes there is simply no alternative but to cut the marketing budget and then the problem is what do you cut?
Henry Ford (cars) and John Wanamaker (retail) are just two highly successful people who said they know half their advertising was wasted, just not which half. the problem then is what do you cut when you have to in order to save money?
For B2B companies I believe there is a simple and effective way of knowing what marketing works, and therefore should be kept, and what doesn’t work – and so can be cut:
ASK YOUR CUSTOMERS
Whenever you talk to a customer, particularly when they call you as a new prospect, ask what prompted them to call you. Although I am sure there have been multiple touches, there will usually be one that sticks in the customer’s mind and, in my opinion, that is the one that counts. Record that answer in your customer relationship management (CRM) system, in your Excel spreadsheet or wherever you keep your prospect list. You can then analyse the data, understand your marketing performance and then make the decisions you need to.
If you have to cut money from the marketing budget, it would be mad to reduce the spend on the activities that are bringing in the money but it makes absolute sense to cut, or re-direct, the money that isn’t generating the return on investment you need.
If you would like some assistance in identifying what could be cut, give me a call or click here and I will call you
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