Economic Uncertainty: What It Means for Marketing Professionals
What does the economic shift mean for marketing professionals?
Are we in a recession or not? The media tells us one day we’re in a recession and the next day we’re not. The leading indicators for a recession are:
- 2 consecutive months of negative GDP growth (which as of July 2022, we have seen),
- an inversion in the yield curve (which we haven’t seen yet),
- a rising unemployment rate (which is falling, down to 3.5% as of today),
- and a decline in asset price such as the stock market correction (we have seen that) or declining housing prices (we’re starting to see that).
So no wonder why people are confused, it’s like being half pregnant. We can’t tell if things are on the rise or falling. We recently conducted a poll to ask our marketing audience how they feel about the economy and what they are doing about it. Additionally, we had a phenomenal webinar with marketing leaders from a start up and a $1B sized company to ask how they think about a recession as a VP/CMO. ( insert link to the webinar here)
The survey showed us that we’re divided when it comes to our companies having conversations about budget cuts and potential staff reductions. But we know it’s on the horizon. With news that companies like Oracle are laying off staff and cutting $1B in expenses, we have to expect others will be following.
When we asked respondents how will your strategy change if budget or staff cuts come into play, the results were 63% said they’d focus on bottom of the funnel tactics. This is where Peerspot’s late stage leads and intent data can really help cut costs and drive conversion. It takes on average 117 days to close a deal from start to finish, it’s 40% longer for large enterprise purchases and on average 31 touches to convert someone from first touch to revenue, however when you start with a site like PeerSpot, you cut 63% off that journey. This is meaningful cost savings in number of touches, channels to engage and time.
While larger companies have the luxury of brand awareness, their focus will shift to driving and accelerating pipeline conversions. Smaller companies will still have the challenge of limited awareness in the market and have to split their dollars to drive both. However, the pressure of VCs looking for profits will force these smaller companies to get really focused on how they drive conversions to revenue.
When asked what programs they would eliminate or reduce, events hit the top of the list. While we are all excited to be going to live events again and seeing people after nearly 2 years in COVID lock down, events continue to be a very large expense. And the addition of doing them both live and online (aka hybrid), means even more expense. So the economy may push us back into regional dinners/meet ups over large tradeshows again, and more online events to optimize the ROI. While this might make financial sense, a compounding issue is online fatigue and low attendance rates to online activities. A common tactic mentioned in the webinar was focusing on install base and driving cross sell/ upsell as a low cost way to drive revenue. Additionally, looking at how to narrowly target your spend to ABM accounts and really getting mynical about the impact each dollar makes per account you target. Maybe the days of spray and pray and broad based syndication are over for now?
So what can you do to ensure your job is safe?
The feedback we saw in the webinar were things like:
- Proactively promote the work you’re doing and the impact it’s making to the bottom line
- Don’t be “that guy” who isn’t pulling their weight and people notice, your lack of performance could put you on “the list” for layoffs, even if your role is in the critical path of revenue
- Ideally look for ways to show your work is driving pipeline and revenue, the further you are from this or highly strategic initiatives, the more likely you’ll be on the list.
- Understand what finance cares about.
- Align yourself to the success of sales and have them be your champion.
- Sadly if you are in a brand, comms, or awareness roll in a big company, you might be on the list as they consider cutting expenses that don’t tie directly to revenue. This is less of an issue in smaller companies as executives in those companies realize they need those attributes to get ‘at bats’ for their sales teams.
- Look for contractors or agencies you can cut and reallocate that work to internal teams, this saves on program dollars and gives employees more responsibility and potentially less risk of being on the list. This is a great opportunity for the brand, comms and awareness teams in big companies to show efforts to save costs and take ownership internally.
- In the event you are laid off, know that it happens to everyone, it’s not about you or your work, it’s a business decision and keep your chin up. The market is great for tech marketers, you’re going to be fine and in hindsight you’ll realize it was the best thing that ever happened to you. (trust me, I know, it happened to me).
Learn more about how to prepare and what to expect in the event of a economic downturn