Well, it was inevitable. The seemingly endless climb of all things tech over the last decade and more (putting aside the temporary blip caused by Covid in its initial phase) has finally come to an end. Lofty valuations crushed, growth rates clipped and more sober expectations around forecasts and what funding is available to achieve those.

As happens during every downturn, there is intense pressure on budgets, especially marketing spending since its impact is often the hardest to prove in definitive terms. The diktat handed on down from the CxO suite is “do more with less”, which loosely translated is, “you still need to achieve the original goals we gave you but we’re taking away some of your budget”.

What’s the average marketer to do?

We have a few suggestions based on our own experiences as marketers, agency people and also what we see our customers doing in such situations.

  1. Yes, freeze new headcount – this is the easiest and often lowest human impact move since you’re only not hiring against open positions. No existing employee is impacted, except perhaps that your team may need to continue to push hard.
  2. Get super focused on what programs and activities are driving measurable impact. No CxO is opposed to positive ROI in general so if you can gather the data to prove that what you’re doing is adding more (topline, bottomline) than it costs, odds are that you’ll get the requisite approval.
  3. Take a hard look at how your marketing budget is split up, building on above point and see what the breakout is between significant line items such as:
    • Performance advertising/campaigns
    • Events and conferences – internal or external
    • Content development
    • Digital asset creation and campaigns
    • Re-branding and related efforts

Some criteria to measure these against.

  • Timeline of expected results – are you spending on something that will deliver this quarter or the next. If not, it can perhaps wait.
  • Stage of customer journey – Is this a high-level awareness building effort or does it do something further down the customer journey. If the latter and closer to closing a sale, it’s money well spent. If earlier in the journey, it may need to be postponed. Note – we’re big believers in building brands and awareness so this is said purely in the context of when you have to make difficult trade-offs.
  • Scale – If your team has the bandwidth to manage them, it’s ok to let them run with a couple of smaller $ programs. Focus is great at times like this, but also important to keep morale high and not snuff out any creativity in your team which takes the form of innovative ideas or campaigns.
  • Find agency partners who are hungry, flexible and in it for the long run. Don’t be afraid to ask them to collaborate with you and share some of the pain in the near term (discounts, etc.) but remember that they need to remain viable as well so be receptive to the idea of more persistent contracts and ability to recover rates over time. Does your agency have a model that lends itself to cost reductions – e.g. are they hybrid in location and between FTE and freelancers? Are they bloated with fancy offices and high rents which you are indirectly paying for of course. Do they charge you for their time or for actually delivering results?

Unless you’re relatively new to the workforce, we’re guessing you’ve been here before and have a sense for how to navigate these choppy waters. We hope the suggestions above are helpful in creating a framework for how to think about how best to optimize your budgets.

And yes, if you’re looking for an agency partner that meets the criteria laid out above, we’re here to help!

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