October 16, 2008

When faced with imminent economic downturn, often the first response of management is to cut marketing budget. But is it the right response? It is not.

Economic downturn brings many woes. Cash flow becomes tight and costs escalate. So curtailing marketing budget is on top of the agenda to cut costs and manage the bottom-line. But you do this when you consider marketing as a cost head. This is a major flaw in thinking.

Busting a few marketing myths would go a long way in not only managing the economic downturn but profiting from it.

Myth #1: Marketing is a cost
Reality: Marketing is an investment. Good marketing is like nourishing a plant into a fruit bearing tree. Its effects last a long time. This is of much significance during economic slowdown when your competitors are more likely to stay dormant. By investing optimally, you have a fair chance to impress the consumers as there is less clutter during slowdowns owning to likely budget cuts by your competitors. Even if the consumers doesn't purchase now, she in all likelihood would consider you when good times come back.

Myth #2: For effective marketing you need big money, which in turn is scare during economic slowdown.
Reality: Marketing is more of a mind game rather than money game. It's like a game of chess where everything depends upon how you position your pieces to control the squares and checkmate your opponent. Today, Web2.0 has enabled a marketer to indulge in low cost marketing to create buzz around the brand and create word of the mouth marketing structure. All you require is a little creativity along with understanding of various technologies and tools available to do virtually free marketing.

Myth #3: Mass media vehicles are the most impactful
Reality: New economy offers multiple media vehicles which create a multiplier effect. Gone are the days when only real vehicles were electronic media and print media. Today, impact comes from an integrated approach which is not only highly cost effective but also highly targeted. For examples, in India there are >225 million mobile phone subscribers. By tying up with mobile service providers you can reach a higher percentage of your target audience at a fraction of cost required to reach them through mass media. Similarly, through effective use of blogs, internet communities, and social networking sites you can reach your target audience virtually free of cost! Even PR is highly effective in reaching target audience at much cheaper cost than mass media.

Myth #4: Marketing team and advertising agency are drivers of marketing
Reality: Marketing is a multi-dimensional game with multiple players. It cannot be limited to marketing team and advertising agency if it has to reach its true potential in to build brands. Today, in a web2.0 world, marketing is evolving as a consumer controlled process rather than a marketer controlled process. Marketers are increasingly emerging as moderators who guide the interaction between a brand and its consumers. In the new paradigm, the most important thing for a marketer to do is to create an ecosystem where they co-create value with consumers. Also, an often overlooked aspect of brand building is the potential role an employee could play. Employees can act as walking talking brand ambassadors to the world to create a viral effect about the perception of a brand. Marketers must learn to tap into them.

To cut the long story short, marketing is all about mindset. If mindset and attitude is right, then ways to do cost effective marketing are endless and limited only by a marketer's thinking and creativity!