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Home > By DEPARTMENTS > Sales and Marketing > Marketing Management

The 'New Normal' for Advertisers Likely to be the 'New Norm' for Business

Deepest Cuts Behind Them! Business is adopting a new attitude -- maybe we should take a look at the receding tide of excesses.

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This survey report struck me as not just applicable to advertising and marketing, but to business in general. With businesses around the world admitting that they aren't borrowing money because they don't anticipate a lot of purchasing... well, maybe we need to adjust our thinking to match the receding tide.

One one hand, we could work harder to maintain the status quo -- but on the other hand -- maybe we could take a bit of time off, reduce our home and family budgets, and realize that the age of excesses is over. The earth might appreciate that -- and so might your family! (Once they get over the shock of seeing you in unexpected places like the dinner table and Saturdays at the park. :-)

Marketers Still Frugal, But Deepest Cuts Behind Them

According to the most recent contiguous six month poll by the Association of National Advertisers (ANA), 83% of the respondents indicate they are identifying cost savings and reductions in their current marketing and advertising efforts. While that represents a high percentage of respondents, this is improved from six months ago (87%), one year ago (93%), and eighteen months ago (87%).

The report concludes that "The recession may be officially over, but it appears that marketers have reset their expectations and a greater degree of frugality has set in. Cost savings and reductions may be the "new normal", even when the economy improves significantly."

In the most recent survey, 41% of respondents are planning to reduce marketing budgets by 1-5% and 70% plan reductions of 1-10%, up substantially from 55% in the July 2009 survey. Only 7% plan reductions greater than 20%, which is down sharply from 30% in July 2009. This indicates that the deepest cuts may have already been made.

The top four ways marketers are reducing costs and spending:

  • 75% are challenging agencies to reduce internal expenses and/or identify cost reductions
  • 73% are reducing departmental travel and expenses
  • 53% are reducing advertising media budgets
  • 50% are reducing advertising production budgets

Challenging agencies to reduce internal expenses and/or identify cost reductions has increased in each of the surveys. But just about every other category declined in the most recent survey, notes the report.

SOURCE: Research Brief from the Center for Media Research, Feb 17, 2010

Edited by Carolyn Allen, owner/editor of California Green Solutions
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