A year ago and six months ago the Association of National Advertisers polled its members to determine how marketing and advertising budgets were being impacted by the tough economic
conditions. ANA repeated the survey again in late July/early August 2009 and found that marketers are still pressured to reduce costs and spending. Today, 87% of the respondents indicate they are
identifying cost savings and reductions, the same as one year ago, and only slightly improved from 93% six months ago.
The top four ways marketers are reducing costs and spending remain the
same:
- 81% are reducing departmental travel and expenses
- 74% are reducing advertising media budgets
- 71% are challenging agencies to reduce
internal expenses and/or identify cost reductions
- 64% are reducing advertising production budgets
Reducing agency compensation continues to gain greater
consideration by marketers:
- 56% are planning to do this today
- 48% six months ago
- 32% a year ago
Fewer marketers are eliminating/delaying
new projects, compared with past surveys:
- 53% in the most recent survey versus 58% six months ago and 61% a year ago.
- 30% of respondents today are planning to
reduce their budgets by more than 20%.
- 37% of respondents were planning to reduce budgets by more than 20% six months ago. The deepest cuts may already have been
made
Marketer spending in first half 2009 was worse than forecast in ANA's previous survey:
- In January/February 2009, 49% of marketers thought their advertising
budgets would be reduced in the next six months, when actually 62% experienced a budget decrease
- 43% thought their budgets would remain the same, but only 32% did indeed
stay the same
- 8% thought they would see a budget increase, whereas 7% did
Marketers continue to forecast lower spending for the balance of 2009:
- 39%
think their advertising budgets will be reduced (versus 49% in the last survey)
- 44% think budgets will stay the same (43% in last survey)
- 17% are hopeful their budgets
will increase (8% last survey)
Anticipated Amount of Reduction In Overall
Marketing Budget (% of Respondents) |
| Study
Period |
Reduction (%) | Jul/Aug‘08 | Jan/Feb'09 | Jul/Aug'09 |
1-5% | 19.2% | 15.1% | 21.9% |
6-10% | 33.3% | 22.7% | 22.9% |
11-20% | 26.9% | 25.2% | 26.0% |
21-30% | 10.3% | 17.6% | 11.5% |
> 30% | 10.3%
| 19.3% | 17.7% |
Source: ANA
Recession Survey, August 2009 |
Planned Reduction in Costs And Expenditures Within Marketing Or Advertising Efforts (% of Respondents; Multiple Response OK) |
| Study Period |
Expenditure
Reduction | Jul/Aug'08 | Jan/Feb'09 | Jul/Aug'09 |
Departmental travel and expense restrictions | 62.7% | 87.1% | 81.3% |
Reduction in
advertising campaign media budgets | 69.3% | 76.7% | 73.6% |
Challenge agencies to reduce internal expenses and/or | | | |
identify cost reductions | 62.7% | 68.1% | 71.4% |
Reduction in advertising campaign production budgets | 62.7% | 72.4% | 63.7% |
Reduce agency compensation | 32.0% | 48.3% | 56.0% |
Departmental salary and/or hiring freezes | 45.3% | 56.9% | 56.0% |
Eliminate/delay new projects | 61.3% | 57.8% | 52.7% |
Alter mix of marketing channels to lower cost channels | 40.0% | 44.0% | 46.2% |
Reduce/eliminate use of outside consultants | 36.0% | 43.1% | 41.8% |
Reduction in spending on research | -- | -- | 34.1% |
Conduct compliance audits for recovery of misbillings, over-payments | 13.3%
| 13.8% | 17.6% |
Use freelancers to fill open
positions (instead of hiring fulltime employees) | 24.0% | 18.1% | 16.5% |
Use open bid sourcing among agencies for projects/campaigns | 12.0% | 11.2% | 14.3% |
Decoupling of services from the agency
and buy direct from supplier | 21.3% | 14.7% | 8.8% |
Use online reverse auctions to bid down/identify lowest cost supplier | 12.0%
| 9.5% | 4.4% |
Source: ANA
Recession Survey, August 2009 |
For additional information, please visit the ANA here.