Why Branding is Worth Investing In (Even When Budgets are Cut)

More often than not, we see marketing and branding budgets being cut the second things go south for a company or the economy. Costs and operations and sales budgets are prioritized time and time again.

“Marketing budgets have suffered the most severe blow since 2009 as companies adjust to the decline in business and consumer spending caused by the coronavirus pandemic, the latest IPA Bellwether Report shows,” according to an article in PR Week written just months after onset of the COVID-19 pandemic. “It is a sharp change from the previous Bellwether, when a net balance of 4% of marketers reported an increase in budgets.”

It’s important to note, as stated in the article: “The data was collected between 2 and 27 March, ending just a few days after the government announced the lockdown, raising the possibility that the figures would be significantly worse if the research was repeated today.”

Strong brands accelerate business growth.

An article in Forbes provides excellent insight:

• In 1927, Harvard Business Review uncovered that companies that maintained their investment in branding and marketing through the Great Depression came out 20% ahead of how they went into the recession.
• Cahners Publishing Company found that advertising during a recession leads to, on average, a 1.5x increase in market share. But more interestingly, during economic boom periods, they saw that 80% of businesses invested in advertising, but saw little to no movement in market share.
• Finally, a MarketSense study found that investing in both long-term brand-building and short-term performance programs saw the best results during a recession.

When it comes down to it, having a strong brand can protect your business in a downturn and help boost it in an upturn.