Making smarter decisions with a shrinking budget

With tighter budgets and consumers' weakened confidence, advertisers are looking for ways to make marketing dollars work harder. Two questions we get asked frequently are: 1. How are customers reacting in the current economy? and 2. How can my business get the most from a shrinking marketing budget?

No surprise here: according to Deloitte's 23rd Annual Holiday Survey of retail spending and trends, 59% of consumers expect to reduce their spending this holiday season. Higher food prices (73%) and higher energy prices (69%) were the top two reasons for spending less, outpacing the economy (61%) and job uncertainty (18%). With fewer clients, many businesses and organizations stop marketing altogether.

But before you put your marketing on hold, here are a few things to consider. First, the cluttered advertising environment we've all become accustomed to in recent years has changed. With fewer people advertising, those who do advertise are getting more attention. The media, seeing leaner times, are also more likely to offer special rates and value-added services. Lately we've seen offers such as free Internet ads with purchased ad space, and bonus television and radio spots when there is excess inventory, at no cost. And with the emergence of "new media," we have a whole new arsenal of ways to market that are free or at least inexpensive.

So instead of putting a stop to all your marketing and advertising, consider new ways to stay in the public eye. Use public relations, promotions and Internet marketing to make your traditional ad spending go further. Keep a close watch on all your marketing so you know which tactics are working now, and put the rest on hold. Even with a limited marketing budget those who do maintain their marketing through a recession, even in a small way, will already be at the top of the minds of consumers when spending levels return to normal.