Marketers knew an economic downturn would mean tightened budgets and more accountability for each dollar, but they may have underestimated the squeeze.
When the Association of National Advertisers (ANA) surveyed marketers in early 2009, 49% of respondents expected their budgets to be reduced in the next six months. Another 43% said their budgets would stay the same.
But in July–August 2009, the ANA found that 62% of marketer respondents had actually experienced budget cuts in the first half of the year. Only 32% saw their budgets held steady.
After a difficult first half, the pressure may be easing off somewhat for the rest of 2009. Marketers surveyed in summer 2009 were more than twice as likely to expect an budget increase in the next six months compared with January–February. And 39.3% of respondents were expected further cuts, compared with 48.8% in early 2009..
In addition, budget reductions are getting smaller. Fewer respondents were planning cuts greater than 20%. Meanwhile, more marketers said they anticipated lesser cuts, especially reductions of 1% to 5%.
“Marketing has been dramatically altered by the current economic conditions,” said Bob Liodice, president and CEO of the ANA. “Our ongoing series of recession surveys show that while marketers are consistently hopeful, the reality is that more tempered spending has become the new norm.”
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Check out today’s other article, “Online Shoppers Want Helping Human Hand.”