Psychology of Consumer Behaviour |

Thursday, February 19, 2009

Cut! Cut! Cut!

ANA (Association of National Advertisers) reports that the recession has had a profound effect on the marketing industry .

The top five areas where marketers plan to reduce costs or expenditures in marketing and advertising efforts are:

* Departmental travel and expense restrictions (87% versus 63% in the previous survey)
* Reducing advertising campaign media budgets (77% versus 69% in the previous survey)
* Reducing advertising campaign production budgets (72% versus 63% in the previous survey)
* Challenging agencies to reduce internal expenses and/or identify cost reductions (68% versus 63% in the previous survey)
* Eliminating or delaying new projects (58% versus 61) in the previous survey)

Other tactics under consideration
* Departmental salary or hiring freezes jumped to 57% from 45% six months ago
* 48% of marketers are looking at reducing agency compensation today, versus 32% six months ago

What's really happened in last six months:

* In July/August, 53% of marketers thought their advertising budgets would be reduced in the next six months, when in fact, 71% experienced a budget decrease
* 38% thought their budgets would remain the same, but only 23% had their budgets untouched
* 9% thought they would see a budget increase, when only six% did

Bob Liodice, ANA President and CEO, concludes that "... some marketers, (in the current economic environment)... will skew their media mix towards promotional spending and direct marketing... others will frame a new, relevant and timely brand message."

(Source: Research Brief: Marketing Plans Take a beating, Center for Media Research, Media Post Feb 19, 2009)

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