Why cutting brand marketing in a downturn costs more in the long run.

As marketers, we’ve been through this before. The choppy uncertainty of geopolitics. Production challenges from supply chain pressures. And the overwhelming temptation to tighten the belt and cut things that can seem optional when the going gets tougher.

Marketing and advertising are often high on the kill list. After all, don’t we have loyal customers who know us, who love our products and will continue to buy whether we’re marketing to them or not? It’s possible, I guess.

But a Catalina Marketing Study in the recession of 2008 of 685 CPG brands found that fewer than half (48%) of highly loyal customers stayed with their preferred brands when the economy worsened. In that same period, giant brands such as Cheerios and Tylenol lost approximately 35% of their brand customers.

More recently, during the COVID pandemic, brands that went dark with marketing suffered an estimated 11% revenue drop by 2021, and many are still repairing the losses.

The message doesn’t need to be written across every billboard: If you slash your marketing budget to beat a downturn, then brand preference, sales and customer loyalty are all on the chopping block too. And the cut can be painfully deep.

The train-wreck case studies from recessions and world wars are all over marketing textbooks. But faced with external economic pressures and internal C-suite directives, it can be very easy for marketers to jump to the short-term “fix.”

So, as we face potential market downturns, as we wonder about tariff impacts and eye the complexity of the new media landscape, take a pause. Consider the facts more closely and assess the alternatives to help keep your budget intact, your brand efficient and customers engaged. You’ll be glad you did.

All cuts are not created equal. The Kantar Global Media Trends report (2020-2021) presents a stark reality for would-be marketing budget cutters. During the pandemic, brands that halved their ad spend saw a roughly 1 percent immediate fall in sales. But those that eliminated all advertising faced a 13% plummet, combined with a 39% drop in brand awareness plus a staggering 10 to 38% market share loss in just one to three years, according to the Journal of Advertising.

While short-term savings are appealing, long-term reputational fallout and potential long-term sales loss make recovery difficult and expensive—and that’s assuming all other factors remain stable. If competition continues to advertise to your customers, the damage can be exponential. And if you’re a smaller brand without the awareness cushion of bigger brands’ years of continuous brand advertising and loyalty marketing, regaining visibility and share will be an even bigger uphill battle.

We’re wired to act fast during challenging moments. Research has shown that doing something in challenging times seems the right thing. Soccer goalkeepers have more chances of saving goals in a penalty shootout if they stay in the center of the goal, but 98% dive left or right because staying still feels wrong, one study highlighted.

When weighing whether to continue or cut marketing spend, the answer lies in taking effective action for your brand and business. If you don’t, you’re giving competitors an opportunity to gain voice, share and emotional bandwidth.

Instead of eyeing a significant budget cut, use this time to rethink where and how your budget is being spent.

In unpredictable times, consumers want consistency and, even more important, relevance. What’s your brand’s real role in people’s lives? Have your agency’s media and planning teams audit messaging, performance and engagement to build a refreshed picture.

It’s tempting to dump dollars into performance channels for quick wins. But brand equity is built over time with sustained presence. Short-term thinking brings only long-term loss. Rebalance your marketing mix and don’t abandon reach and storytelling in pursuit of immediate gains.

Uncertainty needs flexible programs that can adapt to market shifts while continuing to deliver results. Build shorter campaign cycles and conduct frequent testing of creative and placement. Use analytics to build a clear data-led vision of what’s working and why.

Marketing isn’t discretionary, but corporate leadership can lose track of that. Bring finance, operations, procurement and leadership into the strategic planning process. Use data to demonstrate how healthy brand presence correlates with price setting power, talent attraction and resilience in turbulent times. Make it less about a line item spend and more about how marketing builds company value.

Brands that stay the course with marketing aren’t just playing defense. They’re buying equity while the market is on sale. It’s always been this way. In the 1980s recession, a McGraw-Hill study famously found that brands that maintained marketing saw 256% higher sales than competitors who stopped. And that’s in a time when we had far less sophisticated targeting.

Today’s ROI from data-driven buying and always-on media is potentially far greater. So, when the waters get choppy and the wind blows, ask if it’s a storm to weather or the opportunity to gain momentum in a better direction?