Economic Slump – Time To Introspect Marketing Function?

By Biswajit Das, Founder, Brandintelle Services Pvt Ltd

(Associate Co. of Mediaware Infotech Pvt Ltd)

Let's face it. Asian Tiger China's GDP growth rate has hit a 27-year low and is likely to end 2019 under
6%. And GDP growth rate of India - the other Asian tiger has also hit a six year low is expected to
fall to 6% in this fiscal year, according to the World Bank. Both these big cats are however, above
the Asia Pacific GDP growth rate which is expected to be below 4%.

2019 –Year of The Falling Economies?

While a steep fall in demand, direct trade disputes with the USA & political churn in Hong Kong is
responsible for the 27 year low in GDP growth rate of China, to make matters worse, the Chinese
government has not yet recovered from the after effects of providing stimulus to the Chinese
economy for nearly a decade.

Back home, the real estate industry is still struggling & factory output is slowing down, resulting in
slow growth in employment. However, considering the situation in our neighbouring country, while
the government has taken a slew of measures - steep cut in corporate tax rate (22% from 30%) and
an even lower tax rate for new manufacturing companies (15%) to attract new foreign direct
investments (FDI), the same is yet to translate into meaningful outcome and spur the growth.

Economy In Advertising

With all this economic downturn, advertising was bound to be depressed. And it did, especially in
the last two quarters. The Indian advertising industry's estimated worth was INR 62,000 crore in
2018. Most predictions of Indian ad spend growth hovered between 10% & 12% riding on the wave
of ad spends during the 2019 General Elections & the ICC Cricket World Cup. However, the actual
growth may be lower at around 9% - 10% (including inflation), taking the total annual ad spend to
INR 67,000 crore. (By the way, the Asia Pacific ad spend growth rate for 2019 is predicted at 4%.)

So What Worked & What Didn't?

Television medium growth is estimated between 9% and 10% in 2019. Digital medium growth is
estimated between 25% and 30% in 2019. Print medium growth is expected to range between 5%
and 7% and all the other media growth being under 6%. So while television managed to hold its fort,
print medium was marginalised in a real sense. Meanwhile, digital medium hopscotched to pole
position from where it is poised to overtake print & challenge television. And the other media
chugged along.

Role Of Marketing Dept In Slowdown

It's all very well to acknowledge the economic slowdown, demand slump and the marketing slack.
Question is, with a full team strength, what should Marketing focus on during this slack period?

For one, marketing can start adopting technology seriously. This is a challenging task for the CMO &
his team, but if successful, this is the surest way of boosting Marketing ROI. How? Because you can
only improve what you can measure. And bringing IT into Marketing is the first step towards
measurement. The objective itself is deceptively simple: bring information technology closer to
marketing strategy as well as marketing operations.

● The first step can be total process automation for Marketing Depts., where every activity is
included. Apart from bringing discipline, process automation will also bring uniformity &
transparency.
● Once marketing processes are automated, a central marketing database is automatically
created and populated in real time.
● This bridges the "data chasm" between Marketing, Finance & Sales, bringing data
transparency.
● This "data transparency" will result in immediate cuts in unnecessary marketing
expenditure - as managers will start to spend with more caution. This itself can result in
10% to 15% immediate savings.
● The central marketing database will also provide real time dashboard reporting to
Marketing Managers for quick reviews.
● This data can be clubbed with sales, research, share of voice ... to get ROI statistics.
● And the clubbed data can be further used for conducting analytics exercises & generating
deep marketing insights.

Marketing Dept. must adopt Information Technology. And for this, the CMO must lead & exert his
influence on his team. And this is the perfect time to solemnise Marketing Dept’s marriage with
Information Technology & contribute to the company’s savings for now & the future!