It’s no secret that we’re in a time of political and economic uncertainty, and a recent report from the IPA suggests that these factors are contributing to a slump in UK marketing spend. For the report, a total of 300 UK-based companies shared their budgets and outlook, and 34% of those questioned were ‘pessimistic’ about future budgets, while only 8% were “optimistic”. Of those questioned, only 20% reported greater budgets, but even this was completely offset by another 20% cutting expenditure.
It’s clear that reduced marketing budgets are a reality that many companies and marketing managers are facing, and it can be tempting to try to cut back wherever possible. However, it’s risky to reign in your marketing activity at a time where driving sales is crucial. So, how do you ensure you are using that reduced budget to best effect?
The IPA report found that despite budgets taking a hit, there has been growth reported in some sectors. One of these was digital marketing, which saw net growth of 11.5%, and internet search and SEO budgets continued to grow at the rate of 9.9%.
This implies that companies are still seeing the value of investing in digital marketing and SEO, and are prioritising this area of marketing over others. Here’s why:
Your customers are online
Even when walking down the street, people don’t look at billboards or pick up newspapers: instead they’re staring at their phones. Effective marketing means getting in front of your customers- being where they are- and the majority of customers are online. This means that the digital is still one of the most effective ways to reach customers.
Added to this, more than 50% of the world’s population are under the age of 30 – meaning that there are more digital natives than ever before. To appeal to this new generation of digitally-minded consumers, investing in a digital marketing strategy has never been more important.
Of course, there are lots of different channels you can use to reach your customers online- SEO, PPC, Email marketing, social media. Building an in-house team to cover all these areas can be near-impossible for many businesses due to the specialist nature of the skills required and the cost involved. This is where digital marketing agencies can help: a digital agency retains employees in a range of different roles, working across all digital channels, and can apply the right mix of skills to meet campaign objectives.
Digital marketing can enhance revenue and boost ROI
One of the huge positives about digital marketing is how easy it is to track your results. This makes it easy to see – quickly- what is working and what isn’t, and make necessary adjustments to improve your ROI. You can also predict the kind of return you are likely to get on your investment, making it easier to project revenues. No other form of marketing is as trackable or as transparent.
However, effective tracking across multiple platforms and campaigns can be time consuming, and requires experience. On top of this, amendments may have to be made depending on the results, optimisation may be required, and budgets may need to be re-deployed. In short: effective digital marketing requires constant testing, reporting and management. This is where a digital marketing agency can come into its own as they will have experience in effectively managing digital marketing budgets and making client’s accounts work more efficiently and profitably. When working with a digital agency, the client will set the budget and provide targets, and the digital agency will handle the rest.
Your competitors are still investing in digital
A recent study found that 56% of CEOs feel that digital advancements have already led to boosts in revenue. This is obviously the primary goal of any business, so it’s unlikely that any company owner who’s seen these kind of results will be reducing their digital marketing spend any time soon.
It’s estimated that by 2020, 47% of all revenue will be influenced by digital. With this in mind, it’s safe to say that anyone not embracing digital marketing is in danger of being left behind.
The key is to remain relevant and stand out amongst the competition, and this is where a digital marketing agency can help. Whilst those within companies have an unrivalled knowledge of their own product or service, digital marketing agencies work across a wide variety of industries. Whilst agency employees may not have the same level of specialist knowledge as those who work in-house, what they do have is experience of innovative, successful marketing techniques, and how to apply these techniques across different sectors to help businesses grow. Agency employees are also required to be up to date (and usually have certifications) in the latest techniques, such as being qualified in Google Adwords, Analytics, etc. Partnering with an agency gives companies access to the kind of insight and expertise that can really help set them apart from competitors.
So in this time of economic unrest, consider how best to utilise that reduced marketing budget, and keep in mind that digital is going nowhere: this is the time to invest in a strong digital strategy and lay foundations for the future.