• by Sarah Mahoney  @mahoney_sarah, December 11, 2008

The impact of the recession is weighing heavily on retailers this season, and few think advertising or marketing is the answer. A new study from BDO Seidman reports that 35% of CMOs at leading retailers say they have cut back their ad spending as a result of the soft economy and weak consumer spending, and 43% say their holiday budgets are flat compared to last year. Only 25% have cranked up their spending.

In part, says Catherine Fox-Simpson, a partner in BDO Seidman's retail and consumer products in Dallas, that's because "stores are recognizing that at the moment, it's chic to be cheap and everyone is very focused on saving money. Advertising isn't going to change that mindset."

Print continues to be the favorite medium, with 57% of CMOs reporting that they will spend the majority of their advertising and marketing budgets on print advertising. About 21% are focusing on broadcast outlets, and 19% are concentrating ad buys on the Internet, including social networking. The firm polled CMOs of retailers with more than $100 million in annual sales.

In particular, shoppers are not going to be caught paying full price for anything, which means that marketing messages "aren't about staying in front of customers--it's about getting in front of them when you have the very best deals," she adds.

Despite a troubled economy, retailers are still committed to green merchandise, with 43% saying they are increasing their advertising and marketing focus on green products this holiday season--an increase from 37% last year. "Historically, in tough times, campaigns become less flashy, more sentimental and heavily focused on value-added items, such as sustainable products," notes the report.