Yesterday I met my cousin over breakfast.
Because of the recent coronavirus outbreak, there is a possibility of a recession here in Singapore. Given how the virus has affected retail and tourism here, consumer spending is sure to go down.
When consumer spending goes down, it means businesses are making less money, thus, the cut in budget and operating cost.
“The first thing that the company cut is their advertising budget…”
My cousin works as the head of marketing in a big MNC and he knows how big MNCs allocate advertising budget.
Usually, the first thing they do when it comes to recessions… is to cut their marketing dollars.
Here’s the question…
If You Cut Your Ad Dollars,
How Are You Going To Bring
In New Business?
Interesting isn’t it?
If one is worried about the lack of sales, isn’t marketing or advertising the thing that you should focus more so that you can bring in the revenue?
Obviously, if the current method you are doing is not bringing in the desired revenue, isn’t the marketing department the one to think of different campaigns to bring in the revenue?
I strongly disagree with cutting the advertising budget so as to ride out the recession… that to me is just bad advice.
Obviously, I told him it’s stupid… and that one of the things MNCs don’t do, is ‘measure’ their marketing.
Think about this..
If every dollar spend in advertising can bring in two dollars…
Then why would you want to cut your budget?
If every dollar spend can bring in two dollars… doesn’t it make sense to increase your advertising budget instead of cutting them?
There Is A Difference
Between Traditional Marketing
And Direct Response Marketing
One is branding, ie, getting the word out as much as possible, and maybe, measure the overall revenue generated… regardless if its from the campaign or not.
That’s not measurable…
You can’t scale what you can’t measure
I came from a direct response background.
For every campaign I run, I need to know what traffic source, what placement, which interest, which ads, which list… etc
This way, we can cut off the fat and focus only on the ones that brings in the money.
Obviously, It’s just a different opinion from different camps.
So…
Is Direct Response Marketing
Than Branding?
It depends on which camp you are from.
The direct response marketers will say that direct response are better.
The branding guys will say that branding is the way to go.
Instead of debating which camp is better… why not marry the 2?
Some of the most successful ‘Big Idea’ came from branding ads…
Think about the cult that Apple has created back in 1997…
“Think Different”
“The misfits, the rebels, the troublemakers…”
I haven’t seen any direct response campaign that beat this message that Apple has created… generating billions and billions of dollars.
So now again, which is better?
Hard to answer huh..?
I Think that The Key To Marketing
Success Is To Marry The Two
A marketer should know what direct response marketing is, am able to create measurable campaigns based on direct response practice. This way, every marketing dollars are used to bring in good dollars.
Likewise, a marketer should also know what branding campaigns are. Able to allocate budget to do their branding campaigns.
There will be times when branding campaigns will beat out direct response campaigns. At the same time.. there will also be periods where direct response campaign will continue to bring in consistent sales for the company regardless of the economy.
What do you think?
Let me know =)