The current economic expansion is long by historical standards, which means the risk of recession rises with each passing month.
During a recession or economic downturn, many companies tighten the purse strings. And where's the first place they usually cut back? Marketing budgets. But a recession can present opportunities for well-prepared agile marketers to master the turmoil and gain market share.
The most common challenge faced by marketing in a recession is budget constraints. Marketing teams have their budgets slashed and voice frustration over the extreme cost focus of senior management that does not recognize marketing ROI.
Another significant challenge faced by marketing is the lack of resources and impact of restructuring in their organizations. Not only are marketing budgets slashed, but marketing teams are cut back, resulting in a significant decline in marketing activity, leaving you designing, implementing or executing marketing strategies in a cost-zero environment.
In a recession, the economic environment changes quickly and with it changes the needs of your customers. The results? Fickle customers with a high propensity to switch suppliers, and difficulties in forecasting. The need to see, understand and adapt to your customer needs faster is becoming critical.
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Key Changes to Marketing in a Recession
Regardless of the prevailing economic environment, the principles of marketing remain the same — marketing is all about meeting needs, profitably and ensuring that the right product is in the right place and at the right price. It is the practice of marketing that changes, especially in a recession.
Marketing in Economic Upswing
Marketing in Recession
Marketing seen as an investment
Marketing seen as an expense
Marketing has a broad scope
Marketing has a limited and narrow scope
The good news is marketing can survive the turbulence and even prosper from it by practicing agile marketing.
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How Can Agile Marketing Help?
In a recession, marketing organizations need to change the way they work to drive increased performance and achieve the effectiveness and efficiency they need to stay relevant in a deteriorating economic environment. In an effort to be more agile and to ultimately survive, many marketers have adopted agile marketing, a work management methodology that emphasizes visibility, collaboration, adaptability and continuous improvement.
Agile marketing is an approach to marketing that takes its inspiration from agile development and that values:
- Responding to change over following a rigid plan
- Rapid iterations over Big-Bang campaigns
- Testing and data over opinions and conventions
- Numerous small experiments over a few large bets
- Individuals and interactions over target markets
- Collaboration over silos and hierarchy
In its latest 2019 Marketing Trends Report, IBM lists agile marketing as one of the top emerging marketing trends: “As digital transformations accelerate and demand for exceptional customer experiences grows, marketers and CX professionals are faced with the new realities of thinking, working and collaboration to support their businesses. More and more marketing teams are adopting agile frameworks as part of their transformations. They must prioritize their work by understanding which problems they're looking to solve and why, while they define which outcomes need to be achieved and measured within a given sprint.”
According to AgileSherpas' first annual State of Agile Marketing Report, 37 percent of marketing teams are already practicing agile marketing to allow them to quickly pivot marketing priorities, deliver higher quality work and increase productivity to accelerate delivery to market.
“Successful agile marketing teams are already outpacing their competitors,” says AgileSherpas’ president and lead trainer Andrea Fryrear. “Those forward-looking CMOs who take the time to revamp their processes now will enjoy greater success during the good times, as well as the more challenging times likely ahead of us.”
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The Benefits of Agile Marketing
Below are some of the benefits agile marketing provides that can help you survive and thrive through the next recession:
Faster Response to Change
The rules in the business world, specially during a recession, are akin to the rules of nature: if you can adapt, you can survive. The ability to adapt and respond faster to change during a downturn is an important competitive advantage for marketing teams. In a recession, the conditions just change too quickly to keep plans current. Agile marketing allows you to accelerate the test, revise and run cycle on campaigns to better compare planned activity with actual results.
Faster Time to Market
Time is money. A slow speed to market gives the competition the upper hand and leaves your brand stale. The agile method sets you up with the procedural infrastructure to move projects or campaigns from the ideation stage to delivery at a competitive rate.
Agile marketing focuses on constant improvement. So, for the most part, if your team spots an inefficiency in their process during one sprint, they can tweak their methods before their next sprint so they never run into the same problem again. Using agile, your marketing team has visibility into the team’s objectives, priorities, and projects.
Staying focused on the highest work priorities allows marketers to remain proactive rather than reactive in economic downturn and leads to positive market and customer outcomes. Agile marketing encourages daily backlog prioritization. This helps ensure you’re working on the most valuable work, making it easier to prove your team’s value to the rest of the organization and win back any lost marketing budget.
Focus on The Customer
In a recession, a B2B company is highly dependent on its small clutch of valuable customers and is significantly affected if any of these customers goes bust or cuts demand. Agile marketing emphasizes the need to organize your work processes so they revolve around the voice of your customer, whether your customer is an internal or external client or a target audience.
A downturn also creates an opportunity for marketers who are more efficient at turning marketing investments into revenue. Agile marketers who focus on getting the most out of every dollar spent and on demonstrating marketing’s impact on revenue and pipeline will be well positioned to come out of the slump looking like a star.
Per Darwin’s theory, being agile has never been more imperative to a marketer’s survival. Nature and the next recession will always favor the agile.
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