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Meeting in-year targets amidst a global pandemic is the biggest challenge faced by marketers right now. On 14th May, ADA hosted a webinar to address this very dilemma.
First, we looked at how things have changed as a result of the crisis.
We conducted a survey of over 200 ADA clients (representing mid-large brands across a variety of consumer-focused industries throughout Southeast Asia and South Asia) in early May 2020. They told us:
Respondents also told us that a majority of them will shift their focus to digital channels. Hardly surprising as digital is considered more budget-friendly than above-the-line channels, and because of the lack of availability in linear TV inventory such as sports.
When asked how they have shifted their activities to reflect new goals and priorities:
Now to answer the burning question. Should YOU cut your budget? For data driven recommendations and expert analysis of our ADA experts, checkout our on-demand webinar or download our whitepaper.
For those who are still on the fence about cutting their budget as a response to the pandemic, the following matrix can act as a decision-making tool. It’s important to note that this isn’t an exhaustive matrix, and you should take into account your own businesses’ specific circumstances when plotting where you stand here.
The matrix (figure 2) looks at both the ability to serve, against consumer demand; where ability to serve is defined as your ability to serve your consumers despite the pandemic and whether your consumers still have the demand product/service.
For example, if you are in the aviation industry, your ability to serve is almost none since most airports are locked down, and demand for it is also rock bottom because of travel restrictions imposed by most governments.
On the flipside, if you are in the e-commerce business, your ability to serve is not hampered because of pandemic related restrictions and the demand has gone up because people are reluctant to buy through brick and mortar outlets.
Consumer spend is either unaffected by the crisis (in the case of many Consumer Goods businesses) or actually increases in the case of eCommerce due to shifting patterns of behaviour. This high consumer demand, coupled with the ability to serve their consumers because they’re not impeded by physical restrictions or have a complete digital experience, means they are in a position to thrive.
We recommend doubling down on their marketing budget, i.e. increase spend to get more market share.
Consumer spend is either unaffected by the crisis (in the case of many Consumer Goods businesses) or actually increases in the case of eCommerce due to shifting patterns of behaviour. This high consumer demand, coupled with the ability to serve their consumers because they’re not impeded by physical restrictions or have a complete digital experience, means they are in a position to thrive.
We recommend doubling down on their marketing budget, i.e. increase spend to get more market share.
Wherever you fall on the matrix above, it’s likely you’ll to deal with some form of marketing budget cut. The first instinct for marketers and their CEOs or CFOs is to make indiscriminate budget cuts across the board. This is the most common approach because it requires the least amount of cognitive strain.
But it is important to remember that not all areas of our marketing budget have the same impact. Making indiscriminate budget cuts across the board might result in short term savings, but could harm your brand in the long run. The figure below shows how indiscriminate budget cuts would reflect across a wide range of your marketing activity.
Firstly, there will be a loss of market share to contend with. Disappearing from consumer awareness for extended periods of time will also make it harder for brands to regain market share and trust once the crisis is over
Next, by slashing their spend on insights, marketers will be left in the dark during times when consumer behaviour continues to shift drastically
Watch our webinar “Planning Your Marketing in Uncertain Times: Adapt and Retool for the New World” to understand how and where to make strategic budget cuts that still help you meet our goals. Or read our complete white paper here.