Text by Christian Quenneville, president of creative production agency M&H.
2023 is fast approaching and the word recession is on everyone’s lips. Moreover, according to The Economist, a global recession is inevitable in 2023, and according to Finance Minister Eric Girard, “there is a 100% chance that growth in 2023 will be weaker than in 2022.” As a professional in the creative and digital industries for 25 years, I have faced several large-scale crises such as the dotcom bust, the 2008 financial crisis and the Covid-19 pandemic. These two crises are, of course, very different in their contexts, but if I have one piece of advice for companies as the economic slowdown approaches, it’s for sure: protect your marketing investments!
Sapio Research’s International Business Barometer report shows that 95% of companies are worried about the possibility of a recession. Half of organizations plan to reduce marketing spending by next year to prepare for this. However, according to many, this is the time to stand out and appreciate yourself. How to protect marketing investments during a crisis?
1. Start by reviewing your marketing processes.
A new model is emerging in the marketing industry. We often talk about the traditional “agency + advertiser” duo, but is it really profitable? Indeed, according to McKinsey, cost management can free up 20% of a marketing budget and act as both a foundation to weather the storm and a catalyst for growth. In this uncertain economic context, it is necessary to increase the efficiency of a company’s marketing processes. Now we are talking about the winning trio “advertiser + production agency + advertising agency”. This, in my opinion, is the equation that will allow companies to emerge from the crisis. I tell my clients that they can gain 15-20% efficiency by focusing on improving processes and technological marketing tools (martech). This efficiency gain can translate into reduced investment or even allow reinvestment elsewhere in the marketing value chain.
2. Focus on content.
On the eve of recession, every business is wondering: how much should we cut the budget? Based on the success of companies that have maintained marketing spending during crises (the example of P&G in 2020), they have achieved stronger and more significant market gains. To get there, the real question to ask is more: how can I use my marketing budget more effectively? Part of the answer: through content! When you think about all the ramifications of XYZ’s marketing budget, there’s an incredible part that ends up in the content realm: social media and digital content in general. This idea of content effectiveness is based not only on media investment, but also on its complexity. As a business, it is important to think about the number of creative works produced, their effectiveness and the investment required to produce them. After taking these into account, efficiency can be gained by changing content management. By maximizing the technology tools we use (for example: Adobe Workfront suite, Proof HQ or even DAM), we add time savings from 1 second to 3 minutes, which has a significant impact on our clients’ budget. .
3. Remember that a recession is not forever.
For marketers who fear a prolonged economic downturn, note that many recessions are short-lived: historically, 75% of recessions end within a year, and 30% last only two quarters. So, in such a short period of time, the solution is not to reduce the marketing budget, but to optimize it!
To summarize, my advice to all marketing professionals is:
• Optimize your marketing technology processes and tools with the winning trio;
• Find the right balance between content creation and media investment;
• Take advantage of technology to save time and money!