I follow economic news with keen interest, and lately it’s been a pendulum that seems to swing between optimism and concern. Every time there’s a story that points to pockets of economic recovery, it seems to be cancelled out by a report on a country in a debt crisis or an industry challenged by still-sluggish customer demand.
This already-critical issue is surely going to be amplified by the 2012 presidential election. What will the election and the debate on the economy mean for marketers? Other than agencies that specialize in political advertising (which seems to be recession-proof) and broadcast networks that sell their airtime to political candidates, there’s a lot of caution in the air.
Without clear-cut evidence that the worst of the economic recession is behind us, marketing organizations are hesitant to increase budgets and make new investments. On the agency side, clients are pushing for more collaboration and better integration.
Avi Dan, a Marketing and Advertising columnist for Forbes.com examined this issue last month with his blog post Marketers Remain Cautious in an Election Year. He noted that the Association of National Advertisers annual survey revealed that only 17% of those marketing executives surveyed believed they would be increasing their marketing budgets in the next six months. As he notes, this sense of caution will continue to permeate marketing budgets and marketing discussions not just at companies but at marketing agencies.
What is happening is an obvious emphasis on controlling costs and building a stronger sense of collaboration. While this is painfully necessary, I believe it can have positive outcomes for both.
- For companies still reluctant to hire new marketing personnel, agencies can provide that expertise, particularly if it is a marketing specialization. More and more clients and agencies are using this hybrid approach. It’s a novel way to get specialists immersed into the client’s business without the company being burdened with the costly commitment of fulltime headcount.
- Integration is also on the increase. Agencies used to be hired by senior management and often only interracted with the upper layers of the client’s management. This often caused a huge disconnect with the rest of the organization. Now those walls are coming down and the agency and the client are working together in a more integrated marketing ecosystem.
The economy has imposed a new reality: clients and agencies are being asked to do more in terms of sharing risk, rewards and accountability. Instead of lamenting the end of the traditional business model, agencies need to embrace this as an opportunity to get closer to their clients and become a partner in their client’s success.
And looking beyond marketing, companies are organizing more and more with and around their larger ecosystems into integrated business systems. I expect marketing organizations developing into larger marketing ecosystems that will closely collaborate with the marketing organizations of their customers, partners, agencies and other relevant organizations across the entire value chain.
For the foreseeable future, I see companies and agencies putting more emphasis on what I call “strategic creativity.” Companies can no longer afford to do their marketing in the traditional “business as usual” approach. Marketing, like every other function in the organization, is a business. Creativity needs to be balanced with a focus on disciplined planning, cost control achieving results.
How has the economy and the upcoming election affected your marketing strategy and your marketing spending?