A tough economy and restrictive trading conditions have created uncertainty for many South African companies. However, it is crucial that businesses which aim to grow, continue to promote themselves through marketing activities.
It is true when businesses are facing tough times, the first thing most businesses to pull their marketing budget. Many marketing professionals will advise against this strategy. More than ever it is important that you should consider your marketing spend as an investment and not an expense. A vital component when it comes to marketing for new companies is testing marketing vehicles to see which performs and provides the best return on investment. Businesses that have been in business for a considerable amount of time can look at data and know which vehicles work for them.
Most companies invest 20% more or less of their resources (marketing budget and time) into marketing. Businesses should continually reinvest this percentage into marketing on an ongoing basis. As time goes on you may be able to decrease your time spent in marketing, but in return monetary resources may need to increase. The key is to find the vehicles that work best for your target market – in newspapers, digital, audio commercials, television commercials, etc.
You will find that some people suggest as your business grows to decrease your amount in marketing. Most will firmly disagree with this tactic. You should always be marketing to new potential customers as well as marketing to the repeat consumer.
Studies have shown that in previous recessions businesses that continued to invest in marketing saw growth in their businesses, while those that pulled their budgets saw a decrease in sales. The need for businesses to promote themselves during difficult times is well documented, including in a report by the Harvard Business Review. The report stated that marketing and advertising are key for a business to position themselves for growth once the market picks up.
“Marketing isn’t optional – it’s a good cost, essential to bringing in revenues from key customers,” stated the report. It went on to warn against cutting all marketing budgets when times get hard, which has been the case with many local companies during the COVID-19 pandemic.”