As digital marketers, this is a question we're getting a lot right now. And it's a big one.
Many companies, our clients included, are struggling with the decision to spend more on digital marketing, even if they're unsure of future revenue, or pause their inbound marketing strategy to save where they can.
It feels like a Catch-22. If you're marketing, you're pulling in leads, but you're not sure what to do with them right now, or even if you can convert them at this point.
If you're not marketing, you're saving money, but you're not filling up your pipeline or maintaining your market position — which for many industries is a hard thing to get in the first place.
So, what's a business to do?
Our president, John Heritage just posted a blog on his LinkedIn about exactly this. He's been engaging actively with our clients through all of this, and the conversations he's had have put a spotlight on what really happens when you cut your digital marketing budget or pause your marketing agency in a time of recession or crisis.
A Case Study:
The Real Effect of Cutting Your Digital Marketing Budget Amid a Global Crisis
I'll leave it to you to read John's full post — it's a good one, with plenty of data to back it up — but I'll also give you a quick synopsis here, too.
John's article takes a look at two very similar clients, with opposite reactions to the COVID-19 crisis. Both clients function in technical B2B industries. Both clients use Evenbound to manage their entire marketing program.
The Clients
Client #1 asked to pause their marketing program until they know that the industry is going to move past this crisis. They're concerned their revenue will drop, and they don't want to spend money if they don't have any coming in.
Client #2 chose to lean into their marketing program. They felt they'd recently made big gains positioning themselves in a competitive market, and don't want to lose that market advantage They felt it would be better to fill up the sales pipeline now, so their sales team could hit the ground running when the economy gets back to work.
John mentions in his post that both decisions are valid. They're both based on sound logic, and each client is just working to do what's best for their company.
That said, the data that's starting to emerge now (we're about 6-7 weeks into Michigan's Stay Home, Stay Safe Order) is telling. Take a look at the high-level KPIs for each of these clients.
The Results
Again, John's article will help make more sense of the data as a whole, but the big picture here is that client #2, who chose to keep investing in digital marketing, has made significant gains in all major KPIs — traffic, leads, and sales.
Their sales conversion rate isn't perfect, but we knew going into this that it probably wouldn't be. People aren't buying right now, but they are planning for a future where they will buy. Client #2 is perfectly positioned for this, with a significant number of leads in their pipeline, ready to convert when the sales team can really get back to full steam.
Though Client #1 will probably be fine, they haven't gained any market share, aren't adding leads to their sales pipeline, and have opened the door for competitors to beat them out online.
Considering Cutting Your Digital Marketing Budget in a Recession?
That's not a decision we can make for you. It's up to you.
But know that by cutting your digital marketing budget, you're probably going to make your climb back to breaking even more difficult. Like client #1, you're going to have to work a little harder to fill up your pipeline when we all go back to work.
Companies that keep marketing, even a little, during this time, are helping to maintain their market position, and fill their sales pipeline with qualified leads, just as client #2 did.
Even if you're not making conversions now, you're setting your sales team up for success when they're able to get back to work, and when buyers are ready to make purchasing decisions again.
I think John summed it up pretty well:
We can't undo COVID-19 at this point. The only thing we can do is control our reactions and our responses.
And I get that, "Just keep marketing" isn't a compelling reason to do it, especially when it's coming from a digital marketing agency. So, here are 5 key reasons to keep marketing, based on the actual data we've been seeing over the past few months:
5 Reasons To Keep Digital Marketing in a Recession
So we've shown you data from our clients, and we've told you, as experts, why we think it's a good idea to keep marketing. But, you're a savvy businessperson, and you know better than to take the word of a marketer at face value. Good critical thinking on your part.
Here are 5 reasons, based in fact, and on tangible data, that it's a good idea to keep digital marketing, even in a recession.
01. Search Traffic is Up
Internet use is up 70%. As more people are in lockdown, more people are turning to the internet for work, for entertainment, and more.
Digital content consumption is at an all-time high.
If you've got great digital content, you're going to see a spike in organic traffic. If you don't have great digital content, now is a good time to start creating it.
Now, we know that conversions are down. Neil Patel said it himself.
That doesn't mean that educational content isn't useful right now.
Just because people aren't buying, doesn't mean their eyes and lead conversions on your site aren't useful to you.
The more quality content you create now — that's targeted to keywords and phrases that are relevant to you and to your ideal buyer — the more leads you're pulling into your pipeline.
And the more leads you have in your pipeline, who are ready to make a purchase as soon as accounting says, "go ahead, we're getting back to business", the more sales you stand to make, and quickly when we're all back to work.
That really sets your sales team up for success.
Take this time to create great content. Content that answers your ideal buyer's top questions, solves their pain points, and helps them make the decisions that are best for them and their companies. Those buyers are searching for those answers, and they're searching now.
When you're at the top of the list (and search engine results pages) with quality content that answers questions, informs, and solves problems, you're also going to be at the top of the list when those people are ready to buy.
02. PPC Advertising Costs Are Down
A global crisis means that many companies have paused their marketing and advertising efforts. Social media advertising rates and PPC costs are down.
And it stands to reason — if there's less competition, and fewer companies bidding on search terms, that bid cost will go down.
For you, this means there's some opportunity to reconfigure your paid digital advertising campaigns for keywords that are relevant to your business.
Since conversions are still down a bit (though not as much as you'd expect), it's important to be smart here, but if you're doing paid advertising right, you can see some serious results. Neil Patel has shown that his paid ads have increased in ROI from 31% to 53%.
That's a significant increase in ROI, showing that he's paying a whole lot less, to get a whole lot more.
We'd suggest you take a look at your paid ad strategy and focus on two main areas of user intent — awareness, and decision making. Awareness ads, especially on social media platforms, will work to keep your name out there, solidifying you as an authority in the industry.
Paid search ads focused on keywords, especially long-tail keywords, that indicate decision-making intent, are the ones that will get you that ROI.
Their cost is significantly lower right now, which means that when people do convert, you're getting a whole lot more bang for your buck.
03. Digital Marketing is Both Flexible and Scaleable
Their cost is significantly lower right now, which means that when people do convert, you're getting a whole lot more bang for your buck.
A huge advantage of digital marketing is that it's not static.
You're not putting down a huge chunk of money to wait and see what it returns.
Digital marketing is comprised of a multitude of tactics — blogging, social media engagement, paid search advertising, social media advertising, email marketing, conversational marketing, the list goes on.
Some of those tactics are easier and less expensive than others, and some might cost you something, but only what you are willing to spend.
The beauty of digital marketing is that you get to decide what works for your business, and optimize those efforts based on the results you're seeing.
If something's not working, making a change is easy. If your budget is light one month, you can scale back paid ads to just the campaigns that are producing results. Or you can shift your efforts to nurturing the leads you have with content and email marketing.
Digital marketing is one of the few marketing and advertising opportunities that can produce significant results while being flexible according to your capacity, and scaleable to your available budget. It makes sense to lean in now, with whatever you've got.
04. You Have the Time to Make Necessary Improvements
It's never a good thing to have your sales team stuck at home. It's not ideal, and we're not getting around that. But, this is an opportunity to make improvements.
In normal times, your sales team, your marketing team, and everyone else is typically functioning at full capacity.
They're on the road, handling client meetings, drawing up quotes, and more. There isn't much space to optimize or improve your process when everyone is so busy.
Right now, you have the opportunity to take a close look at how your marketing and sales processes are working, and make the necessary improvements.
We've had clients who have decided to use this time to improve a long-outdated website.
They'll move out of this crisis with a fresh, new digital face for their company that's also working to draw in leads.
We've had clients who decided to use this time to improve their sales process.
Setting up a solid sales pipeline with deal stages, and clear visibility on what deals are in the pipeline, and where, can do a ton to streamline sales, improving your reps ability to focus on closing hot and warm leads when the time comes.
Finally, sales and marketing alignment is another great place to spend a bit of extra time right now. Get your sales and marketing teams together on a zoom call, and work on some alignment strategies.
While this isn't an ideal situation for anyone, we can't control what has already happened.
You can control how you use this time to move your business forward.
05. You Have the Space to Gain Market Position
Finally, maintaining a digital marketing strategy allows you to gain a better position in your market. For many industries, your company's reputation is everything. If people know your name, you'll get the business.
But, you have to build up a lot of awareness, and a lot of trust to gain that reputation, and that's where digital marketing comes in now.
At this point, you have the time, and you have the space, to work to better position yourself as a leader and an authority in your industry.
Many companies have halted all marketing and advertising efforts. That means there's room for you to grow and move up. The greater your authority online, the better positioned you are on search engines, which in turn boosts your competitive position in the market.
Take this time to do some research and identify where those opportunities exist.
Write educational content that helps people. Update your website to show new visitors what you are capable of, and what sets you apart in the industry. Then take all of that work, and promote it.
Together, these efforts work to position you higher, and more strategically in your industry. With a bit less competition online right now, and a bit more effort on your part, you'll start to see your position rise, just like it did for client #1 in the case study mentioned earlier.
That helps you draw in more site visitors, who become leads, who eventually — when the economy reopens — turn into sales.
What Can You Do Today, To Ensure Growth Tomorrow?
Choosing to extend or pause your digital marketing budget at this time really comes down to this question: what can you do today, to ensure growth tomorrow?
For any business, the answer to that question might look a little different. And it's true that not every business will have the budget to market as they were before this crisis happened. But, if you have the ability, any level of digital marketing is absolutely an opportunity for growth at this time.
If you're new to digital marketing or aren't sure where to start optimizing or reconfiguring your existing strategy, you might just need a fresh pair of eyes to help you out. The Evenbound team is here to help. We're happy to answer any questions you might have.
