Whether your business is in the middle of a rough financial period, or you’re just looking for ways to save money, it makes sense to examine your budget and start making cuts. But which expenses are necessary and which should be eliminated?
As you review your records, you may see that your most recent email or social media campaigns didn’t directly result in a noticeable boost in sales. So is that a sign that you should cut your marketing budget? The answer is, without question, no.
In fact, marketing is exactly what you need to bring in more customers and keep your business chugging along. Let’s take a look at why marketing is important, the risks you face in cutting your marketing program and tips for more effective marketing.
Why is marketing important?
It’s easy to see all the money that you’re spending on marketing as an unnecessary expense when the payoff is delayed or unquantifiable. You may gain more email subscribers, social media engagement or website visitors as you direct more attention and money toward promoting your business, but the impact of those metrics on revenue often isn’t immediate.
Morrison’s Irish Pub, one of the six Alton, Illinois, businesses selected for a Small Business Revolution — Main Street revitalization, was struggling to make their loan and insurance payments. In an effort to cover the high expenses they were incurring, they cut their monthly $300 marketing budget down to just $50. Though borrowing money from their marketing budget temporarily solved one problem, they weren’t attracting as many new customers as they needed to sustain the business — something that marketing could have helped them do.
Marketing is important because it creates a bridge between your products or services and your customers. You may have the best whiskey collection in the county, but if no one knows about your pub, you won’t be able to succeed. Yet spreading the word about your business is only the beginning. Other benefits of effective marketing include:
1. It improves your reputation. Whether you’re using customer testimonials in your campaigns to support your messaging, or interacting with your fans on Facebook, strong marketing shows prospective customers that you’re professional and reputable.
2. It sells products or services. Marketing tells consumers why they should purchase what you’re selling, and where they can get it.
3. It builds relationships. Marketing allows you to engage with your customers and tell your company story
4. It creates customer loyalty. By consistently engaging with your audience — presenting them with discounts, offers, thank-you’s, news updates and so on — you’ll make sure that they remember you when they’re ready to make a purchase.
What are the dangers of not doing marketing?
Here are just a few of the consequences you may experience if you decide to cut marketing out of your business budget.
5. Loss of market share: You might have stopped marketing your business, but your competitors haven’t stopped marketing theirs. A company that’s sending out reorder notices and promotional emails or creating search and social media ad campaigns will have more opportunities to connect with consumers who are ready to make a purchase than a company that isn’t.
6. Difficulty attracting new customers: Loyal customers may continue to purchase your products or services without receiving any marketing communications. But how will you attract new customers when you aren’t actively trying to reach them? As time goes on, you will have to bring in new customers to sustain and grow your business. Marketing not only keeps your products and services top of mind for longtime customers, but also introduces your business to new prospects.
7. Losing credibility: If you aren’t marketing your business, then you’re likely missing out on an opportunity to show that you’re an expert in your industry and a trusted resource. Search rankings, frequent social media activity, an up-to-date website and excellent online reviews are just a few of the ways that marketing will build up your business’s credibility.
Four questions to help you get the most from your marketing
Instead of cutting your marketing budget, re-evaluate what you’re doing. If existing methods aren’t working and you’re questioning the amount of money that you’re spending, it will be better in the long run to alter your strategy rather than completely ignore marketing. Consider the following questions as you develop your plan:
1. Which platforms and channels do your customers prefer? Make sure you aren’t overextending yourself. Focus on the marketing channels that attract your ideal customer. For example, if your customers don’t use Twitter, there’s no need to spend money on Twitter advertising or time tweeting. Take a look at which of your marketing efforts are bringing in the best results and direct your attention and dollars to those areas.
2. Is your messaging resonating with customers? If your subscribers aren’t opening your emails and very few people are clicking your ads or calls to action, it could be a sign that your messaging isn’t connecting with your audience.
After deciding to place more of a focus on their marketing, Morrison’s revamped their website. They made sure to emphasize the Irish aspects of the pub to attract hibernophiles — people who love Ireland and Irish culture — as well as anyone else looking for a unique pub experience. The website’s images and text were updated to reflect the spirit of hospitality and tradition that visitors feel when they step into the pub. They also made sure to call out their expansive whiskey collection to entice visitors.
Like Morrison’s, you should assess your content strategy and messaging. Start testing everything, from your subject lines to your website design, to find out which content works best for your customers.
3. Which content can be repurposed? You may have advertisements, social media posts or marketing emails that have performed well in the past. It’s OK to reuse them. A video that you created for social media can be used on your website. The professional photographs on your website can be repurposed for flyers or brochures. Reusing content can save you a lot of time and money.
4. Where can you scale back? Determine what you need to be successful. You can separate the must-have marketing tools from the nice-to-haves by reflecting on how often you use the tool and whether it’s generating leads or engagement.
Your marketing budget should adapt to fit your business. While it may be necessary to make cuts in a few areas right now, you should never eliminate marketing entirely. Remember, you can always add initiatives back to your marketing program when your financial situation becomes more stable.