COVID has taken its toll on the enthusiasm among marketers and agencies when it comes to investing in non-marketing portions of their businesses.
These reductions in spending can have the effect of either put a lot of pressure and strain on an agency-client relationship or it can bring new thinking, ideas, creative solutions to long fought challenges.
At the end of the day, it’s really up to your agency to decide which way it’s going to go.
In this year’s 2021 New Year Outlook survey report , we discovered that both marketers and agencies indicate they will be spending at levels significantly lower than they have in each of the last 7 years.
When looking back over our years of surveying marketers and agencies, the low point for marketers was in 2013, when only 57% stated that they would be “somewhat” or “significantly” increasing their spending on non-marketing activities in the coming year.
This year, that number was only 49%.
Same holds true of agencies. In 2016, 93% of agencies stated they would be “somewhat” or “significantly” increasing investment in their business. In the years post-2016, the enthusiasm among agencies for investing in their business steadily increased…until this past year. In 2020, only 64% of agencies expressed higher levels of interest in investing in their business in the coming year, a marked decline relative to years’ past.
Far fewer marketers expect to see increases in non-marketing investment than they have in year’s past.
Lower investment in your business can potentially mean fewer new hires, less money spent on technology, and fewer dollars invested in R&D, which could slow the pipeline of new product and service launches.
Fewer dollars invested on the agency side can mean much of the same thing.
While this might all seem very concerning, we believe it presents opportunities for you and for agencies.
For agencies, marketing staffing cuts could mean marketers will have more of a need to find outside agency help (versus bringing work in-house).
As we’ll see in next week’s post, hiring quality staff is no easy task for marketers looking to load up their in-house teams – so agencies can be well-positioned to help out. Their ability to capitalize on this phenomena and their ability to be successful in managing a relationship like this will depend on their ability to work with the in-house teams that still do exist. They aren’t going away (as we’ll see next week), they are here to stay.
So what does this mean for you, the marketer?
For you, it may mean you simply need to get even more creative in marketing the products and services you have. The focus on existing businesses may unearth new opportunities you never knew you had. Less time spent on driving the new product or service train gives you more of an opportunity to reflect on your business and find opportunities or insights you never knew you had.
Your agency also has a big role in making adjustments and helping you in a different way if they are going to make the relationship a solid, long-term one.
Your agency needs to be playing a critical role in helping you identify these yet-to-be-found marketing and sales opportunities. Yes, the investment in them may not be as great as it was a year or two ago, but if they’re in it for the long-haul, sacrifices have to be made and the creative thinking cap needs to be put on to help your business muscle its way through to the other side of the crazy, unorthodox times we are finding ourselves in.