Is your company looking for ways to cut costs? Whenever there’s a steep economic downturn, marketers’ budgets tend to suffer. To survive, learn to do more with less.
Today’s guest is Naira Perez from SpringHill Digital. She describes how to maximize marketing results with a minimal budget. Bigger budgets do not mean better results.
Some of the highlights of the show include:
Why? Company isn’t doing well and economic environment is in downturn
Communicate Bottom Line: Convince company that cutting marketing costs more
Cost vs. Resource Center: Marketing can adapt to changing consumer behaviors
Bigger Budgets: Does lack of budget inhibit marketers’ success?
Audience Acquisition: Who are you talking to, and what are you telling them?
What can you get for less? Consider existing clients and user-generated content
Outsource: Need to do same amount of work with fewer people, hire freelancers
Resources: Prioritize people over software due to irreplaceable knowledge/value
Research and Reflect: Look at yourself and company—what can be done better?
Recommendations: Find low-cost, high-impact tactics to prioritize opportunities
Quotes by Naira Perez:
“We need to keep looking at audiences all the time and checking in with audiences.”
“Even though in the short-term, cutting marketing seems like a temporary relief, it can be very costly to the company in the long-term.”
“The companies that will be successful in the long-term, are the ones that take a minute to analyze the new consumer behaviors that are adapted during these downturns.”
“Bigger budgets do not mean better results, especially in these times.”
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Ben: Welcome, Naira, to the show.
Naira: Thank you for having me here.
Ben: If you wouldn’t mind, would you like to take a moment to introduce yourself to our audience and explain what you do at SpringHill Digital?
Naira: Yeah. I’m the founder of SpringHill Digital. We’re a digital marketing agency that specializes in paid media. We work with social paid media—LinkedIn, Facebook, Instagram, to name a few. We work with search engine marketing meaning Google Ads, Bing Ads. We also do native advertising. That will be the Taboola, Outbrain.
If it’s digital media and if it’s […], we do it. We manage campaigns from the beginning, developing their strategy, to creating the ads, to placing, and buying the media. That’s where we really, really excel at optimizing, taking care of your campaign, as it grows online, and as it evolves. We need to keep looking at audiences all the time and checking in with audiences. That’s what we do.
Ben: Cool. A topic that I think is very likely to be on a lot of marketers’ minds, I think a lot of companies’ minds in general right now is budgets. Particularly, potential budget cuts. As we all know, when finances get tight, marketing budgets are also one of the first things of the chopping block. In my opinion, I’m sure it’s in your opinion as well, it’s a mistake. In your experience or just in your opinion, if a marketer is in a position where there are employers looking at budget cuts or maybe if they’re looking at reducing their marketing spend, what would be a few things that you would recommend that they do to state their case to their employer? Or maybe in some cases, it might be stating your cases as an agency to your clients? And prove the value that you have either if you’re an organization or your clients, so that you can hold on to those relationships, and maybe those marketers can hold on to their jobs.
Naira: That’s a very good, very relevant question. The budget cuts are going to happen for two reasons. One, the company is not doing well. It’s a good environment, but it is not doing well because of product, customer service issues, something that is outside of marketing. What the role of marketing in that company is a much bigger conversation. The company is actually not doing well.
The second reason will be when the companies are doing fine but the economic environment is in a downturn or you have a pandemic. In those times, as you were saying, cutting marketing is probably the most often taken route but actually, in our opinion, is the wrong one. The problem here is that we never know. When we’re in a downturn, how long is it going to take? People get very nervous. We don’t know what industries are going to be affected.
Marketing, it seems in these moments, is the best way to cut budgets because normally, companies have not attached an ROI to that marketing or a proper ROI to that marketing. Even though in the short term cutting marketing seems like a temporary relief, it can be very costly to the company in the long term. When marketers understand that and can communicate it is when they can convince the powers to preserve their jobs.
The companies that will be successful in the long term are the ones that take a minute to analyze the new consumer behaviors that are adapted during these downturns. What is happening in the lives of the consumers? Where are they spending their money? What are their new needs and priorities? How can we serve them as a brand? As an agency? How can we serve them better? How can we adapt?
This is where the marketing team really shines. This is what you need to communicate—that we are no longer a cost center, but a resource center. You go from the cost in the company money to actually checking in with you to see where the company should go next.
In these times, I have two examples. One, a company that I really like—their communications efforts—is Delta Air Lines. Whether you hate or love airlines, their communication is flawless. They have centered their communication around how the needs of their consumers are being met. How are they disinfecting airplanes and protecting the consumers? Refunds, how are they going to handle? They have been really good. I feel taken care of. I’m not even traveling. I’m not going to travel for the foreseeable future. I feel like they’re thinking about me.
Not only that, but they are also saying, “Okay. Our new protocols are going to stay for the long run. Once we come out of this pandemic, once we recover, we’ll still be the cleanest airline.” Basically, they don’t say that. I’m paraphrasing. I feel like, “Oh, they’re improving in these times. They’re thinking about what I’m thinking, which is germs in airplanes.” That was done very well.
On a personal level, my childcare provider has me centered all around their communications. They don’t have a marketing team. They have been about, “How do we survive as a business?” I love them. I know they care for my kid. I know they want to be there for my kid in the future. Their communication has been all about them and how they can survive.
Now, I’m suffering because of everything that’s happening around us. Parents are suffering because they have their kids at home. None of that has been demonstrated in their communications, but they take into account what we’re going through. Again, I love them. I know they really care for my kid. However, their communication is lacking in that and it makes consumers feel not taken care of.
Whenever we come out of this, as a consumer, if I have a choice, where would I go? To a brand that I thought was taking care of me or a brand that I thought they were taking care of themselves?
This is what marketing should do. Demonstrate the value of the marketing principles, the loyalty that will remain after all of this is over.
Ben: That’s a fantastic answer. I think those are really good points. I think you can even quite see plenty of more examples out there of those companies that are keeping their communications very customer-focused versus the ones that are a little bit more hitting the panic button visibly in a way where they appear self-centered.
Another component, I think, of this conversation, too, that I think is interesting, that you might have some insight on, is that marketers always think they need a bigger budget. It’s always like, “If I had a little bit more money, there’s this one thing I could do where we would buy this other tool,” or whatever the case may be. There’s something that they think they can’t do because money is inhibiting them. Maybe in some cases, maybe not true in all cases.
If a marketer is thinking that lack of budget is inhibiting their ability to be successful, do you think that this is an erroneous assumption? Why or why not?
Naira: Yeah. Bigger budgets do not mean better results, especially in these times. It’s going back to analyzing your audience. It’s coming back to what behavior your audience is having. Where are they spending their money? Where can we be most effective in getting down to that level of the audience?
Again, going back to the daycare, I know the need that parents are having. We don’t doubt that these people really love our kids. It’s just, are you talking at our level? Are you talking about our needs and how you will do in the future to satisfy them if you’re not going to satisfy them now?
Another example—a more professional one—we have a client that came to us where they had a set budget for Facebook. They’re dumping a lot… well, not a lot of money. In their mind, it’s a lot of money on Facebook. Having a very high cost per clicks for what they were doing, which was unbelievable high, in my opinion. Their solution was to dump more budget so that cost per click will be more clicks instead of making efficient use of your audience and lowering that cost per click.
What we did when we got the client, we reanalyzed the audience. We reanalyzed how they were seeing the product. What was the communication style that the audience was using online? We were able to get cost per clicks that were four times lower than what they had been achieving. What does that mean? That now, with the same budget, brings way more people—four times more people—to their website. Not only that, but that audience that is coming to their website is also way more engaged. It’s converting better and actually became ambassadors—loyal customers, loyal followers—that when there was some negativity about the brand in the conversation, the followers themselves defended the brand, talked about positive things that the brands were doing, et cetera. What that also means is they could decrease their budget a little bit and still have more people coming to their website, more sales than they had before.
We’re talking about, in some channels, this brand was spending less than $10 a day. It’s not about having more. It’s using those $10 in a very efficient way. We always go back to the audience. I probably will say that. No matter what question you ask me, I’ll go back to the audience because that’s who’s buying your product. That’s who’s listening to you. That’s who you should be listening to.
Segmenting that audience is very important. Listening to that audience is very important. That affects your budget. Don’t throw away your budget. Don’t just pour more budgets because you’re going to get more results. Be very surgical especially in these times. Be very surgical about what audience you’re talking to and what you are telling them. I’ll say that if we […] the audience and we see what process, what time in their customer journey they were in, we needed to talk about different things.
As an example, acquiring customers. We need to talk about the most popular products that they were having. They’re popular for a reason. When we were introducing new collections, it was actually more effective to talk to their followers because their followers care about their brand. They would be very accepting and excited about new products. However, sales are most effective with retargeting. People that […] into that brand maybe didn’t buy it because it was too expensive. In that sense, whenever we came back and said, “We understand, we heard you. Here’s a sale for you. Try us,” then, the conversion happens. At every stage of the customer journey, we had a different point of communication.
Ben: Something I really want to call attention to here for a moment, and something that I alluded to in the introduction of this episode as well, is the fact that bigger budgets do not always equal bigger results. As marketers, we should always be focused on maximizing outcomes from whatever resources we have available. While sometimes it might be a little bit daunting, it might be a little bit anxiety-inducing, if you are operating with less than what you’re used to, sometimes we’re forced to do that maybe even if it’s against your own wishes, it creates opportunities for us to find more creative ways to solve problems by doing more with less. If you’re able to do that, that’s a very valuable skill that will serve you very well in your career as a marketer. Now, back to Naira.
We’ve established that in all likelihood, budget cuts are going to be coming for a lot of folks right now. We’ve also established that you don’t necessarily need a large budget in order to be successful anyway. Maybe there’s an opportunity there if you approach it with the right mindset.
Let’s say, hypothetically, I’m a marketer and my team is facing budget cuts. What’s the very first thing that you would recommend I do in that situation?
Naira: It depends on what kind of budget cuts. If the cut means fewer resources, you have your team, but now you have fewer media budget, less photo budget, or less travel to […] budget, then what can you get for less? That’s the analysis. Can you use user-generated content instead? Can you reach out to your more fervent followers and use them as ambassadors? Can you concentrate on retargeting? Concentrate on the customers that you already have and really take care of them? They have bought for a reason. You just need to see now, they bought for a reason, now where are they in their journey? Have they moved on? Are you still relevant? If you are, then fantastic. If you’re not, why not? Analyze that.
Concentrating on what you have instead of going out and getting new customers. Don’t get me wrong, new customers are always good. You should always expand. You should always try new audiences and just bring new people. But when you have fewer resources, then you have to bootstrap and just concentrate.
If the cuts are on your team, that’s a different story. It never happens […]. It doesn’t always happen like teams and budgets. If the cuts are on your team, now you have to do the same amount of work with fewer people. We need to analyze what are the most efficient ways to work. What can you do? As an example, contractors or freelancers are good resources. They can work very effectively due to the knowledge they have with other industries. Can you do that? sometimes they may even have resources that you need but you cannot afford on your own. There are software that they may be using, that they split the cost among their clients that now you can be part of.
I will always prioritize (if you can) people over software. People have the knowledge and value to a company’s core value that cannot be replaced by software. If I can make the decision you do with people and maintain these pieces of software, I will go with the people. However, marketing doesn’t always have that power to decide. If it comes from high above, it comes from high above. You have to take what you get. That will be ways to actually be more like a startup. What can we do with very little?
Ben: Yeah. I think the very last point you made is very interesting for startups. For us at CoSchedule, we’re so in the startup phase. That makes a lot of sense to me because for us, that’s always been the reality, like how do you stretch your resources? In the past, I’ve also been in much larger companies that had huge budgets. Their budgets were, use it or lose it. Tight budgets.
I imagined for startups, for small businesses, I think that’s really going to resonate but I think it’s going to be a much larger challenge for a company that was used to having all this stuff, and suddenly, they don’t have it. What would you advise in that instance? Do you once have all the access, all the resources in the world that you thought you needed and now you suddenly don’t? How do you shift your mindset? I just feel like psychologically and emotionally, that’s going to be a shock. I wonder if that shock could even become an impediment to just having the right mindset necessary to be like, “Okay, I can do more with less.”
Naira: Yes. We could use it, as marketers, a good economy brings a lot of good things. Also, we get a little bit relaxed in being very efficient with budgets. We get really comfortable with certain ways of doing things and they work. We continue doing them because they work. However, whenever there is a downturn or a difficult economic time, we need to stop and look at ourselves like our competitors would look at ourselves. That’s what I always tell my clients. You look at yourself like if you were your most fierce competitor. What would you do better?
Research yourself. Look at where you are now. There’s a lot of ways to look at it. In particular, in advertising, Facebook, LinkedIn, they give you the ability to look at what are the messages out there. What are the ads that other companies are operating? Look at yourself, look at others. Make it a competitive study about yourself. Look at where 80% of yourselves and customers came from. Again, is this still relevant? How we acquire them, is it relevant?
I always think of cellphone companies being the worst at this. They concentrate so much on acquiring new subscribers to their services that they forget about the ones that they have now. Remember, these people bought for a reason. These audiences, they loved you at some point. They want to stay with you so go back with them. Go back to them. They’re going to be more willing to shop again with you. […] great customer service and a great product. Therefore, can you upsell them? Can you actually look at partnerships?
I love this idea of partnering with somebody else. Maybe it is in your industry, maybe it’s not. Actually, audiences love when two of their favorite brands come together. Guess what? Those resources of advertising or communication get split in two. It’s a win-win for everybody.
Although it’s a shock, I would always, always, take a minute and say now what? I cannot continue in the same way. Let’s look outside the box, which is really difficult to say. It’s easier to say than to do it. Then, let’s look back at the box we were in, in a way. Let’s see how we can make that box bigger, smaller. Maybe even make it into a triangular. I don’t know. It’s hard to look at oneself but in a way, it is easier whenever things are taken away from you because now you cannot do as much.
That turned out to be very philosophical, I’m sorry.
Ben: No, I think that’s okay. It’s kind of a philosophical question. I think that’s great advice though, in general, for how you shift your perspective. I kind of feel like, especially in circumstances that we’re under right now, any time there’s a massive shock to your company system, this is going to happen. Particularly right now, I think our perspectives have been shifted whether we like it or not. We have a choice, as marketers, to adapt to it or get hung up on what we don’t have anymore. Don’t worry about that being too philosophical or anything. I think that was a great response.
On a tactical level, how would you recommend that marketers identify low-cost but high-impact tactics that might work well for them and really prioritize their greatest areas of opportunities?
Naira: Whenever you’re looking at what you’re trying to achieve, whenever I ask this to my clients, it’s always more sales. Whenever we’re in difficult times, we need to rethink what we want to achieve. I think that whenever we’re looking at reassessing our marketing strategy and reallocating funds, we need to look at making customer loyalty a priority.
Also, while communicating, we are meeting their needs and we listen to them. How can you listen to them the best? Find out where they are and just listen. Don’t talk, just listen and see what’s happening. Tactically, those could be and I’ve had very good luck with Instagram, paid media polls. Those are poll quizzes with only two answers where you ask one question and then the audiences just answer. They have, as I said, only two answers. We learn a lot whenever we do these. We do them in stories. That means that the CPM is really low. Therefore, I can reach more people with less budget.
Audiences love when you ask them questions. They tend to answer very honestly. This has given us the opportunity to learn about, as an example, how to style a product, how people purchase the products that we’re advertising. Is it at the store? Is it a plan purchase? We have even done these for products in development for startups and see if the product needs more explanation or the product is actually attractive enough to grant continuing investing in it.
Instead of paying thousands of dollars for surveys, research, and focus groups, we cut the middle man and ask questions directly to your audience, which also required a very good marketing team because now, you’re in a conversation.
It is going back to question number one, only skilled people can do this. You need your marketing team to talk to your audience, to ask questions, and to see, “Where can I place that question?” Maybe you go and explore Quora. Quora is where people make questions but you can actually advertise in there. Maybe you’ll look at different channels that you’re not used to. That’s your marketing team. That’s their core. That’s what they do every day. That’s what’s going to be the most cost-effective—listening to the audience and moving with them.
Be prepared that after all of this is over, your customer may not have the same habits as they did before. A perfect example will be a restaurant. They had to adapt. Now, they don’t have the dine-in experience; they have to be picked up or delivered. A lot of people are going to get used to this. They’re going to say, “You know what? That is convenient. I kind of liked it.” Especially for people like me that have kids, I don’t have to be embarrassed about my kid throwing the rice everywhere in the restaurant. It’s only in my kitchen. “Hey, you know what? Maybe I’ll do this more often.” Or be loud or something like that. That may change. As a consumer, my habits for the future, instead of going out for pizza, bring the pizza home or going out for Chinese food or Mexican food.
That’s where the restaurants have adapted really quickly. They have to, to survive. Continue to listen because your audience, your customer, may not come back to the dine-in experience at the same level as it did before. That’s what I would say in how to find out those tactics that work for you. As I said, […] advertising that one Instagram paid media poll, I enjoyed it a lot.
Ben: Very cool. I think that’s fantastic stuff; in particular, it’s a great point. Depending on the industry you’re in, your customers are not going to be the same people that they were two months ago.
Naira: They’re not. They’re not. People that never order on Amazon or grocery delivery, now they may find out, “Wow, this is actually cool.” They may do it or there are people, like my niece, talking to the cashier or going every Saturday. That is part of their routine. They cannot wait to go back to that routine. Think that there wasn’t a forced introduction of new habits that some of them will stick with.
Ben: Absolutely. I can say for myself that discovering Postmates is kind of a revelation. Something that I never would have done had circumstances forced the option into my consciousness a little bit. I think it’s a great point.
Naira: Yeah. Grocery and delivery, I love how my local supermarket didn’t use to pick up. Only big brands would do it. Now, my local supermarket, I can just go and put it in my truck. Off I go. This is a business opportunity for them as well.
Ben: For sure, absolutely. You know, Naira? This is a great conversation. Thank you so much for coming on the show this afternoon. That really does it for all the questions I had for you. Before I let you go, was there anything else on this topic that you think is important to mention? Just anything else that is right there at the tip of your tongue that you just haven’t asked yet.
Naira: Your questions were really good, let me tell you. They made me think a lot. Also, I know that there is a lot of business troubling because they have a budget that was tied up in events that were conventions and all their marketing efforts. Now, they don’t know what to do. That’s the real fear that I totally understand. Maybe they need to consider digital. Digital is something that’s always there. It’s very flexible in the way that you can turn it on and turn it off as soon as you can do events again.
What businesses need to do is still be relevant and top of mind of consumers. It is very difficult to regain momentum. Even if you survive without marketing right now, it is very difficult to regain that momentum again. Guess what? Somebody else is going to take that opportunity of you putting out of the marketing and just get ahead of your business.
I understand it’s uncertain times. Everybody is fearful of what comes next or unsure. Maybe you don’t have the big batches that you used to have. Maybe you reallocated. Maybe you were on Facebook, now you’re going to be in Google Search. That’s fine but stay top of mind. That’s what I would say.
Just to reiterate, your marketing team is a resource now. It’s not a cost center, it’s a resource that you should tap into.
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