While it is often thought that finance directors (FDs) and CFOs are generally against extra spending on sales and marketing during tough times, the opposite has been found to be true in the UK according to a survey from database marketing firm KDB and Lightspeed Research.
More than 80% of the FDs surveyed supported the idea that companies should market their way out of trouble in the recession, which suggests that those holding the corporate purse strings now favour the idea of investing more in marketing and customer analysis, with the aim of gaining market share while their competitors are also in a weakened state.
Similarly, 84% said they believe that increasing their company's investment in marketing and consumer insight during the recession would benefit the company in the long run - a view that is supported by historical evidence that highlights the opportunity to gain a competitive advantage through greater customer knowledge.
The support for extra marketing resources does, however, vary greatly according to company size. Respondents from big businesses were significantly more supportive of the idea of boosting investment in marketing and customer insight than those from smaller businesses. The survey found that 100% of respondents belonging to firms that employ 250 - 1,000 people and 98% of those from companies with more than 1,000 employees supported the idea, compared to only 80% of those from businesses with 1 - 10 employees and 83% from companies with 11 - 50 employees.
Support for the idea of increasing marketing investment for the long-term health of a company also varied regionally throughout the UK, and was not as high as the national average in two of the country's biggest business hubs (London and the Midlands) where support stood at only 79% and 81% respectively.
The industry sectors in which respondents most strongly supported the notion of increasing marketing budgets were the Hotel & Catering segment and, perhaps not surprisingly, Media & Marketing. In both sectors, 100% of respondents felt that increasing spend on marketing and customer analysis would give a company a competitive advantage in the long run.
Other sectors in which support for the idea exceeded the national average included Banking, Insurance & Finance (89%), Business Services (98%), IT, Communications & Hi-Tech (93%), Travel & Transport (90%), and Utilities & Telecommunications (91%). Worryingly, the weakest support was noted in the Retail sector (72%).
According to Matt Boot, chief analyst for KDB, "This shows that finance directors do generally understand the historic importance of marketing in a recession, and that they are in favour of spending more on marketing when the money is spent effectively. But what finance directors do want is ROI and accountability if they are going to maintain or even boost budgets at a time when they have to watch every penny closely."