Where's Your Risk Budget?

  • by , Op-Ed Contributor, September 22, 2023
It’s annual planning season. Are you missing a critical element?

Mixed economic signals trigger conservative budgeting, with an emphasis on tightening up familiar messaging and media approaches. That’s a mistake in this environment.

 Brand relationships aren’t linear anymore; attitudes and lifestyles morph too quickly. The key to attracting and sustaining customers is keeping it fresh. And the key to energizing overburdened marketing and creative teams is giving them room to run with new ideas.

 Here’s a simple way to do both.

Think momentum, not maintenance. Today, planning to protect and grow incrementally fails to advance a brand. People need fresh appeals in interesting places to adopt deeper, stronger reasons to believe and buy.

Create a risk budget. Teams and agencies identify and cultivate new energy sources when they transcend the plan. More than ever, they need money and permission to embrace “what if” and try out new tacks in creative, media, and strategy.



Contain it. The point is to stimulate new thinking and alignment. So, the intent and structure matter more than the number. By keeping the total under the trouble line -- that point where the finance team raises questions -- you can build exploration into the marketing routine.

Prioritize creative prototyping. Instead of simply planning some different media, fund experimentation with the fundamentals: who we are, what we’re for, and how we connect. Let people make things that recast brand truths in visceral ways. Everyone rallies around creative work, not briefs or presentations, so concentrate on generating expressions they can get excited about. 

Spread it around. Consider giving multiple vice presidents and/or directors risk budgets. Years ago, a client gave 20 creative people $2,000 each to create any video we wanted for the product. The work brought tears to people’s eyes by portraying what the product does for people in powerful ways. None of it was public-facing -- releases weren’t required -- yet all of it helped expand the brand by demonstrating either “wow, we can be that” or “no, that’s not us at all.”

Track idea flow. The goal is energy, so gauge the volume of possibilities and excitement around ideas. Then look for a spike in employee engagement and satisfaction metrics. The two go together.

When you give people the autonomy and resources to explore new ideas at levels no one can be fired for, you speed up marketing. Development takes its natural course from small to big as risk projects gain momentum. And you end the slog of signing everyone in the company off on the huge, perfect action that launches too late.

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