Many marketers plan an overall increase in marketing dollars being directed toward rebates, loyalty programs and product innovation to help reduce price promotion costs and add more value, according to a study by corporate-funded payments firm daVinci Payments, which reveals how marketers spend their budgets in an economic downturn.
In contrast to the increase in spending on rebates, loyalty schemes and innovation, marketers’ intended investments in branding, channel and price promotion overall were flat versus the year prior. The study, which surveyed C-Level marketing and sales executives, investigated how marketers plan to adjust budget allocations during a recession and the impact this would have on their total marketing spend and services.
The research looked at industries, including large and small appliances, automotive, consumer goods, credit and finance, entertainment, eye care, food, furniture, health care, pet care, research, telco/broadband and technology.
Other key findings from the Recession Marketing Spend study included that:
- Almost 60% of marketers reported they would spend more or the same overall during a recession
- Less than 40% had a recession contingency plan in their 2020 budget
- 80% of marketers believe the price consumers pay for their products will decrease (37%) or stay the same (43%) vs. 2019 during a recession.
“Our findings show that marketers understand they have to deliver greater value to consumers with better branded experiences at every touchpoint to regain traction in an economic downturn,” said Rodney Mason, daVinci’s CRO. “Our recent shopper research found price was the number one consideration factor in making a purchase decision with name brands slipping in importance. An economic downturn amplifies those trends, making it crucial for marketers to win customer loyalty by increasing their value to meet recession demands.”