A downturn is no time to cut your budget. Instead, re-evaluate and make every penny count.
Data from the Office of National Statistics released on 22 July makes for some difficult reading. 89% of UK adults are feeling the effects of the cost-of-living crisis. Half of us are struggling to pay energy bills, and one in five have had to borrow money just to get by.
The Bank of England has an official remit to keep inflation rates between 1% and 3%. Last month the figure hit 9% and it could reach 12% by October.
These are challenging times for businesses. People have less money to spend and that means consumer behaviour is changing. The government has announced that it will be encouraging companies to cut the prices of their goods and services by diverting money away from their marketing budgets. It’s a controversial campaign that aims to relieve the cost-of-living crisis in the short term. In the long term it feels like a risky strategy.
Marketing is all about identifying, understanding, predicting and satisfying customer requirements. During an economic downturn, customer requirements don’t go away, they change. Purchasing behaviour changes and that makes it more important than ever to continue, even redouble, your marketing efforts.
In a rising tide all boats float
In a growth market, organisations can often keep afloat and find new customers simply by being in the right place at the right time. In a recession the rules are different. It’s still possible for companies to maintain market share and even grow but they need to be far more competitive which means understanding your customers and meeting their needs more effectively.
The worst thing you can do is put the brakes on your marketing activities. Now more than ever, you need to understand the market and respond as quickly as possible. That’s exactly what Dell did during the COVID-19 lockdowns. The world was plunged into an unprecedented situation leading to one of the sharpest recessions ever known. When the Prime Minister announced the first lockdown, and working from home became the new normal, customer requirements changed overnight.
Using your marketing budget effectively will bring higher returns
Dell didn’t cut their marketing budget despite the downturn. They made every penny count with highly focused segmentation, targeting and positioning. That’s an example every organisation should follow. In times of trouble, we shouldn’t reduce our marketing budgets, we should re-evaluate in response to the new situation. We need to make sure to use every penny to best effect.
Dell responded to the changing business environment by helping others adapt. They spent time and money developing new messaging and putting on virtual forums for customers around the world. They gave advice on how to do more business online, how to manage remote teams, and how to conduct virtual briefings. While the competitors were saving money, Dell was working out ways to establish itself as “here to help”. The result? Dell’s commercial PC revenue has just jumped 22% to $12 billion.
While few companies have the resources to match Dell, there’s still an important lesson to learn. A downturn is a chance to streamline your operations. It’s a chance to work smarter. Make sure you’re maximising your resources and let nothing go to waste. One way to do this is by cleansing your database. That way you can avoid wasting your budget on inaccurate data and increase your campaign response rates.
B2B Data is often the backbone of any marketing or sales campaign. Contained within it is vital information that can make the difference between success and failure. Business data can decay at over 40% per year, so your database needs to be kept up to date if it is going to consistently deliver the results you expect. There is no point in your sales teams wasting time ringing old telephone numbers or your marketing teams setting up and running email campaigns to addresses that no longer exist.
As time goes by, data needs updating. Using old and inaccurate data can cause loss of revenue, damaged reputation and in a worst-case scenario you can break the law and end up with a large fine. Database cleansing is time-consuming and repetitive but failing to do so is like putting your marketing budget into a leaky bucket. The first step in the cleaning process is a data audit where you identify the problems and work out how to address them. Find out more by reading our blog on the topic: Does your organisation need a B2B data audit?
Alternatively, contact us to talk directly to a member of our team. We offer an expert data cleaning service. Our team will do the tedious work while you get on with the important job of understanding and meeting your customer requirements.
