Why you shouldn’t cut your marketing budget in 2024
With 2023 just about in the books, The Business Bunch CEO and founder, Terri Martin, puts a case forward as to why SMEs shouldn't be cutting their marketing budgets in 2024.
What a year… having talked to hundreds of SMEs over the past few years, I’ve seen a real difference in their mindset and the challenges they’re trying to overcome this year.
If you’ve struggled in 2023, chances are you’ve also looked closely at your budgets and where to make some cuts, and marketing has probably been in the spotlight.
So let’s look at what’s been happening for SMEs in 2023, while also making the case for why you should seriously consider ramping up your marketing budget in 2024.
How SMEs coped in 2023…
Freeze mode
A lot of business owners I know have been in freeze mode in 2023, where they’re so unsure of what direction to take and what areas to fund that they end up doing nothing. Added to this, the longer you do nothing the harder it is to fund any marketing activity down the track as cashflow becomes a problem
Give me leads now.
Lead gen is hot right now. Going by the sheer volume of lead gen sales messages I get on LinkedIn, it’s clear everyone wants leads, and they want them yesterday. But it’s one thing to get leads, and another to get the right leads. Lead gen companies can provide leads, but they can’t guarantee their quality and whether they are likely to convert.
Budget cuts
Marketing has always got a bad rap… created mostly by people who think they can do marketing themselves or hire very junior people to do it in their business. Often business owners don’t realise the huge impact an experienced and commercial marketer can bring to a business. Marketing is often the first thing that gets cut when revenue is down – it’s also the activity that gets you ahead when the tide turns (because you’re not the only business cutting marketing, so the market has a lot more space for you to promote yourself).
General uncertainty
Some businesses are thriving, but nearly all I speak to are struggling in some way – whether it’s reduced leads, or revenue, or increased COGS, reduced margins, or challenges with hiring and retaining staff. At times like this it can be hard to know which issue to fix first.
What do SMEs need to do in 2024?
Seek advice
Talk to other business owners or consultants who have been in your shoes, to get their insight into the challenges you face. This can be done through networking or having a general chat and might help point you in the right direction to work out what you need to focus on first.
Be open to external help
Having an external point of view is refreshing because it can help you see the challenges for what they are, and, more importantly, the way forward. It’s devoid of emotion and “this is the way we’ve always done it”. There are ways to get senior help at more affordable costs through part-time, contract or consultant support. Help is at hand, you just need to be open to receiving it.
Get your house in order
The best thing you can do in early 2024 is get your house in order so anyone who looks at your website, retail site or social media platforms is clear on:
- What you offer.
- Who you offer it to.
- What’s the benefit to them for using your products/services.
- What problems you can solve.
- How you’re different to your competitors.
Don’t cut your marketing
According to the Harvard Business Review, “Companies that have bounced back most strongly from previous recessions usually did not cut their marketing spend, and in many cases actually increased it”. The longer you leave it to invest in marketing, the more your revenue could reduce, which means you get into a cycle of not-being-able-to-afford-it down the track.
Marketing is often a long game, it may not pay off today but it can pay off in the future. Think of it as investing in the future of your organisation. And remember, if your competitors are reducing their marketing spend that means you have even more opportunity to stand out.
Pivot if you have to
If your current product offering or business model isn’t working, review what else you can do. This is where it helps to have an impartial third party to help navigate and brainstorm other ways your business can move forward.
Businesses pivoted a lot during the pandemic and we’ll see more of it next year. But please spend time thinking about it now, rather than when you’re desperate, so you’re prepared.
Terri Martin
Plan ahead
If things felt tough in 2023, it’s unlikely they’re going to get easier in 2024. So plan ahead… what can you do differently? If you don’t know, who can you turn to for help? Spend some time over the holidays thinking about your business and its future.
If 2023 was the year of uncertainty, make 2024 the year you develop a clear path forward.
Focus on talking to people like you, enlist the help of those who have been where you are, continue your marketing efforts, plan ahead and get your house in order.
Trust me, this will all pay huge dividends when others falter and the economy takes off again.
