It’s tough out there right now. The world is (still) teetering on the edge of recession and budgets are being slashed across the board as brands continue to navigate what feels like a never-ending period of sustained economic uncertainty.
In fact, many CMOs have reported finding parts of the past six months harder than the pandemic – at least we knew vaguely where we all stood then (but more on that later…). Despite these ongoing challenges, CMOs looking to grow their businesses are still choosing to invest in brand-building initiatives to keep their brands front-of-mind in what is becoming a rapidly cut-throat
Frontify director of content and communications, Digge Zetterberg, explains why – and perhaps even more importantly – how?
How have leading brands and CMOs dealt with the past 12 months of squeezed budgets and creative cuts?
“It’s been a tough year with a lot of uncertainty about the economy, and worries about a recession are on everyone’s minds. Facing budget constraints, the data from our recent report shows that 46% of CMOs have reduced their reliance on external agencies, with 45% trimming departmental budgets. These actions significantly impact brand-building efforts, especially as we have found that 47% of marketers face additional challenges due to prices going up for consumers.
“Despite these obstacles, CMOs remain resolute in prioritising what matters most for their brands and strategically allocating their investments. Marketers emphasise a heightened focus on social media marketing, recognising it as the most effective and cost-efficient avenue to build their brand and connect with consumers.”
What makes brands that continue to invest during challenging conditions stand apart from the crowd?
“Even with tough economic challenges, a remarkable 87% of CMOs have actively put money into building up their brand this year. This strong commitment not only gives them an advantage but also sets them up for more growth when economic conditions get better. In fact, we recently found that 88% of the CMOs we surveyed said it’s especially important to invest in brands during a recession to pull ahead of competitors.
Subscribe to Marketing Beat for FREE
Sign up here to get the latest marketing news sent straight to your inbox each morning
“When a company keeps investing during tough times, it shows it’s stable and committed. This makes people, like customers and partners, trust the company more. Trust is super important when things are uncertain, as people tend to stick with brands they believe are dependable.
“While other companies might reduce their marketing in difficult times, a company that keeps or boosts its brand building can grab more attention in the market.”
Why do major brands continue to invest in brand-building during a downturn?
“Even during recessions, CMOs understand the value of brand-building investments, as this strategic approach pays off in terms of brand resilience. During downturns, brand leaders are under more pressure than ever to build brand resilience and maintain brand equity, but achieving brand resilience isn’t an overnight process; it requires long-term commitment and sustained effort.
“It’s critical to understand the key priorities that marketing leaders have, as well as what drives the most results, so that CMOs can gain confidence in spending their budgets effectively and win the marathon of brand resilience. They have to be strategic about the resources they are using and how to make the most of those investments.”
Why is ongoing investment in brand building so important moving into 2024 and longer-term?
“In a rapidly evolving market, continuous investment in brand building ensures that a brand remains relevant and recognisable. Even this early on, 2024 is looking like it will be a challenging year, and it’s crucial to stay top-of-mind among consumers, who are exposed to numerous choices.
“When consumers have positive experiences with a brand and resonate with its values, they are more likely to remain loyal, even in the face of competition.
“To succeed in 2024, it’s important for marketers to continue seeking ROI, creating efficiencies, and crafting engaging brand stories. They should also have a long-term strategy supported by the right talent and channel investments. Brands that consistently work on their image, adapt to changes, and tell compelling stories are more likely to stay relevant, gain customer loyalty, and stand out in a competitive market.”
What are the key ways marketers are innovating to get ahead over the coming 12 months?
“Looking ahead, the marketing industry should brace itself for further technological advancements. AI is only going to become more present, and brands that incorporate it into their strategies are likely to see positive results next year. Increased AI integration brings both challenges and opportunities.
“Frontify’s recent research highlights a pressing concern for CMOs, with 73% calling for increased governance in response to an increase in AI-generated brand parodies. With 74% of respondents calling fake-brand partnerships a nightmare, brand protection becomes critical.
“It is essential to strike a fine balance between brand security and encouraging creativity. The enthusiasm for AI reveals a transformational industry, emphasising the importance of implementing security measures to navigate the rising tide of AI in brand protection.”
Is there anything else the Frontify report has thrown light on?
“It has also given us some useful insight into how important it is for brands to stay strong and how committed marketing leaders are to making sure their brand is valuable. One standout point is that 83% of marketing leaders decided to bring in a chief brand officer in the last two years.
“This hiring trend shows that organisations are realising how crucial it is to have someone focused on managing the brand and making big decisions that affect the whole business.
“Even in a situation full of uncertainties and challenges, the report talks about how marketers are being proactive. Despite worries about problems, a significant 51% of CMOs and marketing professionals decided to invest in big changes to their brand, like rebrands and refreshes, over the past two years. What’s even more impressive is that 79% of them saw success, showing that the industry is not just surviving tough times but thriving by changing and growing.
“The positive outcomes of these changes also tell us something important. It suggests that brands are smartly adjusting to what their audience wants. It shows a forward-thinking approach where brands see challenges as chances to grow and transform, making sure they stay relevant and appealing even when things get tough.”
