A new survey from the ANA (Association of National Advertisers) shows that the recession had a more profound effect on the marketing industry than predicted just six months ago,. Following up on a survey conducted in August, the second survey conducted on this topic reveals that more companies are identifying cost savings and reductions (93% as opposed to 87% six months ago) and that 37% of respondents today plan to reduce budgets by more than 20%, up substantially from the 21 % of respondents in the first survey.
The top five areas where marketers plan to reduce costs or expenditures in marketing and advertising efforts are:
- Departmental travel and expense restrictions (87% versus 63% in the previous survey)
- Reducing advertising campaign media budgets (77% versus 69% in the previous survey)
- Reducing advertising campaign production budgets (72% versus 63% in the previous survey)
- Challenging agencies to reduce internal expenses and/or identify cost reductions (68% versus 63% in the previous survey)
- Eliminating or delaying new projects (58% versus 61) in the previous survey)
Other tactics gaining greater consideration by marketers today, as compared to six months ago include:
- Departmental salary or hiring freezes jumped to 57% from 45% six months ago
- 48% of marketers are looking at reducing agency compensation today, versus 32% six months ago
In the first survey, the ANA asked if marketers thought their budgets would increase, decrease or remain the same in the next six months. In the recent survey, the ANA asked what actually happened.
- In July/August, 53% of marketers thought their advertising budgets would be reduced in the next six months, when in fact, 71% experienced a budget decrease
- 38% thought their budgets would remain the same, but only 23% had their budgets untouched
- 9% thought they would see a budget increase, when only six% did
When asked about their predictions for what will happen in six months from now:
- 49% of respondents felt that their advertising budgets would be reduced
- 43% think that they will stay the same
- 8% have hope that their budgets will increase
Bob Liodice, ANA President and CEO, concludes that "... some marketers, (in the current economic environment)... will skew their media mix towards promotional spending and direct marketing... others will frame a new, relevant and timely brand message."
For more information, please visit the Association of National Advertisers here.