Well, unless you are actively trying to ignore what’s happening in the world, you will have seen the news about the rise in living costs. Most noticeably, the looming date of October 1st as energy bills will rise. As this date creeps closer, and so does Q4, discussions typically arise on budgets. More specifically, how to maximise profit for the end of the year to finish the year on a high, or so to speak.

As marketing professionals this stresses us out, often it is marketing budgets that are the first to go as we reach the end of the year. Well, we might be biased *slightly*, but all jokes aside, we are here to tell you why cutting your marketing Q4 budget is a mistake. After all, the famous henry ford once said, “stopping advertising to save money is like stopping your watch to save time.”

Planning your Budget

It is important to consider budgets as a whole to ensure it is effective for your company. We have identified a few key factors to help with this:

  1. Be realistic, let’s face it we can all be overzealous when it comes to money but setting a realistic budget is much better for you in the long run.
  2. Consider the size and scale of your business, make sure the budget matches that – there is no point setting yourself up for failure before you even begin!
  3. Prepare for the unexpected – the past few years have been anything but standard so it is essential to ensure you prepare for anything, for instance the increasing cost of living – you need to have backup plans if things go awry. Outward interference can massively affect your budget!

Q4 Budgets

Asides from the current global dilemmas surrounding budgets in the midst of rising living costs, there have always been debates when setting Q4 budgets. As we draw nearer to the end of the year (wow, where has the time gone) discussions as to how to finish the year strong emerge… and let’s be honest a lot of people consider profit a big factor, so it would seem easy to make a profit by simply cutting budgets here and there. Well one of the first places that this happens is the marketing budget, but we’re here to tell you why you shouldn’t. Consider this, is the holiday season the right time to be scaling back the marketing budget? If you answered yes, did you forget about Black Friday, Cyber Monday, Christmas, Boxing Day Sales and finally New Year – the possibilities for marketing strategies are endless, and so are sales! This is just reiterating the words from Henry Ford outlined at the beginning.

Planning a Budget in the Current Climate

This year started strong with a recent IPA study forecasting massive increases in marketing budgets as we entered a post-Covid reality. Main media marketing was projected to receive strong budgetary support with a net balance of +17.4% anticipated spending growth, with direct marketing expected to receive a +15.5% growth. And all of this following, the unusually high budgets of Q4 of 2021, but this can be explained as businesses pushed to drive sales and awareness post-Covid. 

However, no one expected this dramatic increase in the price of living, and most significantly energy bills. So, aside from the usual discussions of budget cuts to ensure businesses end the year on a high, this year there is the added layer of the dramatic increase in the price of living. Often when considering the ROI against marketing budgets companies freak out when they don’t see what they expect, however it is essential to reflect on current situations. Disposable income is lower, cost of living is higher so ROI is inevitably going to decrease, but does that mean you cut back on all marketing costs in Q4 – no. Want to know why, keep reading on! 

So, what should you do with your Q4 marketing budget?

After a period of unusual increased marketing spend, ad spend from main media has dropped and marketing budgets have stagnated. People often consider marketing as non-essential, well it’s time to wake up and realise marketing is both necessary and essential. We are heading for a recession, and yes paying wages and keeping staff employed is a priority, but so is getting new consumers which is down to marketing. In the era of social media, how do you promote and spread brand awareness if no one is talking about you, it’s simple you can’t. 

As we enter Q4, it is time to be smarter with budgets, not just simply cutting marketing and advertising budgets in response to increased electricity costs. In an era of social media, it is silly to not engage with digital platforms to spread brand awareness, especially with the holiday season approaching. One particular type of marketing that doesn’t have to cost a lot is – influencer marketing. Influencers allow brands an affordable method to connect with their target audience through authentic and relatable content.

A 2021 study from Influencer and Global Web Index found 72% of consumers spending more time on social media since pre-Covid, so rather than cutting marketing budgets – our advice be smarter and adjust your strategies accordingly. Focusing on building these relationships authentically ensures brand loyalty and retention as we enter into the new year, so don’t draw back use what you have more efficiently! 

In conclusion, the world is crazy, costs are increasing and understandably we are all freaking out. The first reaction is to cut off those spends deemed non-essential, but this is wrong. As we enter Q4 there is an opportunity to smartly and effectively use more affordable marketing avenues (such as influencer marketing) to promote and drive awareness for your brand, attract new consumers and revenue – after all ‘tis the season for giving and all that!