“Travel Companies Rein In Their Forecasts As Us Consumers Cut Spending“

“Evidence Is Mounting That The American Shopper Is Cutting Back“

“Consumers Pull Back On Spending; Companies Cut Costs“

These are all recent headlines from media outlets sounding the alarm over changing consumer spending habits brought on by uneven economic data here in the U.S. Along with those consumer cutbacks come reductions in operating budgets by the brands that rely on that consumer spending. 

Our clients in industries such as tourism and hospitality, CPG and the nonprofit sector are certainly feeling the pinch as people start having to make choices about what they really want to spend money on. And, just like those customers, our partners in these industries are having these same conversations, and making these same decisions. And more often than not, when it comes time to tighten the belt and make the numbers work, what’s the first line that gets the red pen?

Marketing. 

On the surface, this can seem like good sense. Cut an expense in favor of something that might generate some immediate cash flow, right?

We (and a lot of others) would argue the exact opposite. When things are shaky is the exact time to make sure your marketing budget is strong and in a position to drive growth. A McKinsey analysis found that during the 2008 recession, companies that took a leap and turned toward growth instead of pulling back to protect themselves averaged a 150% higher return for shareholders over the next ten years than others in their sector. They offer another, more recent example from the height of COVID:

“During the early part of the COVID-19 pandemic, United doubled down on branding. Instead of playing it safe and reducing investments as people slowed down on air travel, United Airlines launched its biggest ad campaign in a decade. According to Maggie Schmerin, United’s head of global advertising, this helped the company forge ahead.”

— McKinsey and Company, 2023

McKinsey essentially found that organizations who treated the downturn like an opportunity to invest in the future of their brand, rather than focusing on the short-term came out much more successful than those more short-sighted brands 

And sure, it’s great to think ahead and assert that investing in marketing sets you up for long term success. But what about right now? In the midst of economic uncertainty, how is maintaining or even increasing your marketing spend going to help you recoup losses or drive new revenue?

1. Take The Microphone.

In the land of weak marketing budgets, the brand with a strong budget is king. 

That’s not the saying, but you get the point. When everyone else is cutting back and turning down the volume on their brand’s voice, you’re getting louder. 

One of the most consistently difficult things about efficient marketing is the proverbial signal-to-noise ratio. In standard conditions, everyone is shouting to be heard, hoping that they can get a word in edgewise over the cacophony of marketing messages that consumers are bombarded with every day. 

The conventional wisdom is that we see around five to ten thousand marketing messages a day. Now, that’s probably apocryphal, but there’s a good chance it’s in the hundreds. Given that mind boggling bombardment, no wonder it’s so hard to break through with a compelling marketing message that drives conversions.

But when your competitors begin to whisper, it’s your time to shout. Harvard Business Review cites the case of Anglo-Dutch consumer goods retailer Reckitt Benckiser, who increased ad spending during an economic downturn, and saw a 14% increase in profits, while their sector competitors were reporting 10% losses.

Now, this doesn’t mean you just shouldn’t change a thing. 

2. Take a Good Hard Look at What’s Working

An important part of weathering a period of economic uncertainty with a steady or increased marketing budget is to really evaluate what you’re spending your marketing dollars on. Any good marketing partner is already optimizing creative and media, but now is the time to take a clear-eyed look at what channels are delivering value and which are not. 

Shifting dollars to your best performing strategies and tactics is especially important—and investing in things like earned media and engagement marketing strategies that deliver outsized media value for their cost—are crucial ways to make sure every dollar is working.

3. Keep Your Momentum

Another massive implication of cutting back on marketing activities is the effect of momentum on your marketing. Getting a new marketing initiative off the ground is a time and resource intensive process. And when you have to essentially cold start a marketing engine that’s been switched off for weeks or months, you’re setting your organization up for a lot of inefficient time and money just getting things going again. When you’ve been humming along, the pain of restarting is a non factor.

4. Focus on the Full Funnel

Economic downturns also present a unique opportunity to take advantage of the power of the traditional model of the marketing funnel. In a powerful partnership with the idea we talked about above, being a powerful voice when your competitors are silent, that doesn’t just mean your conversion-driven ads can be more successful. Ads focused on signups and sales and lead generation and all those KPIs stand out more in these scenarios, certainly, but so do those higher funnel brand affinity and awareness strategies.

When you’re alone on the field, with all eyes on your brand, you have a singular opportunity to project stability, strength, trustworthiness and resilience. These aren’t messages that lead directly to full ecommerce carts or form submissions. They are messages that remind people, in good times and bad, which brands they love the most, and which brands have always been there for them.

If you have the opportunity to stand out not only in the lower funnel conversion tactics, but in the awareness and affinity tactics that live in the upper funnel like OOH, audio and YouTube, you’re solving both short- and long-term problems—and that is every brand’s dream.

By embracing a strategic approach to your marketing efforts during times of economic uncertainty, you’re not just weathering the storm—you’re setting the stage for long-term growth. When others retreat, it’s your chance to take the lead, amplify your brand’s voice, and maintain the momentum that drives sustained success. This isn’t just about surviving; it’s about positioning your brand to thrive when the market rebounds, proving that the real winners are those who continue to invest in their future, no matter the economic climate.