According to Gartner’s Annual CMO Spend Survey released in May, marketing budgets have fallen on average by 15%. Budgets in 2024 now represent 7.7% of overall company revenue, compared to 9.1% in 2023. Cuts have hit spend on martech, labour and agencies the hardest while spend on paid media has grown. “CMOs are living in an ‘era of less’,” argues Ewan McIntyre, VP Analyst and the Chief of Research for the Gartner Marketing Practice. Nothing in the economic outlook suggests this is a short-term challenge for marketing departments to wrestle with.
None of this will come as a surprise to those working in the PR industry who will have no doubt experienced first-hand the budget cuts and their impact on in-house teams and agencies. Cuts are painful and frustrating, but they can also be the inspiration we need to critically evaluate what we are doing, to innovate, and ultimately build better more effective programmes.
It’s easy to fall into the trap of thinking that less means less when in fact if we think like engineers trying to build a faster and more efficient car, less can in fact mean more. More power, more speed and more agility. Here are four ways public relations can help marketing departments win in an “Era of Less”.
Break down marketing silos
Marketing departments have fallen victim to a bolt-on culture. New questions often result in new hires, new departments, new strategies and new lines in budgets. Over time these silos calcify and become entrenched so that budgets feed the marketing machine rather than the objectives of the business.
The power to break down these silos lies with CMOs but PR leaders can do their bit by reaching out across departmental lines to help identify synergies, reduce waste and maximise the impact of marketing spend. To win in the “Era of Less” marketing departments will need to become more integrated and less siloed.
Bridging awareness and demand
One of the greatest benefits that a more integrated approach to marketing can yield is bridging awareness and demand creation. CMOs are not in place to maintain the status quo, they are charged with driving growth. Awareness is essential to achieving that because it ensures you are on the radar of potential buyers. But the buyer journey, especially in a business-to-business environment, has never been more complex with on average 15 people in the process of a major investment decision.
Public relations can be a powerful weapon because it offers one of the most efficient means to address your total addressable market. However, to have the greatest impact awareness building must work in tandem with demand creation.
At their core, awareness and demand campaigns can harness common messaging and storytelling. Businesses that integrate awareness building and demand creation will not only be operationally more efficient they will also combine outreach to your total addressable market with targeted one-to-many and one-to-few sales outreach.
We call our model for achieving this Awareness2Demand™. I believe driving awareness and demand in tandem to be the best way to generate greatest sales impact. To win in the “Era of Less” marketing departments will have to have to bridge awareness and demand creation.
Embrace new agency models
Agencies are essential extensions to resource constrained marketing departments, but for businesses seeking international growth traditional agency models need to evolve. Today there are very few businesses that think about growth along narrow national lines. Often, modern businesses think of themselves as a global business from day one, yet most agencies, even those that purport to be global, are structured and operate in country silos.
By adopting a borderless model for public relations, which we call PRWithoutBorders™, Tyto has been able to help clients operating across Europe extract 30% more value from their agency investments. This was achieved by streamlining the structure of European client teams at the strategic and administrative level.
Once established, this model has proven much more efficient and impactful, but it required a root to branch reimagination of how a European PR agency should be structured, managed and operate. To win in the “Era of Less” marketing departments will need agencies that are adept and efficient at building reputations on an international scale.
Harness AI
We are in the early days of AI rollout and adoption, but the signs are encouraging. In the “Era of Less”, CMOs must find ways of achieving more with less. Cutting waste is a part of this, but marketing departments seeking growth will also need to find ways to be more efficient and increase output.
Harnessed responsibly and appropriately, AI will allow us to do this. This is not about substituting human creativity and originality; it is about giving our people superpowers so that they can be even more productive.
Freeing up our teams from unnecessary admin and accelerating the speed with which they can research and process tasks, will engender much needed time for innovation and creativity. To win in an “Era of Less” marketing departments will have to embrace AI responsibly.
Thriving in times of constraint
We live in exciting times. Public relations professionals are some of the most flexible, imaginative and performance orientated professionals on the planet. We embrace and adapt to change in the same way we do fast-moving news cycles. We’re going to need to call upon these strengths as we seek to help CMOs navigate the “Era of Less”.
PR professionals often rue PR’s absence from the top table of business decision making. The “Era of Less” is an opening for the PR industry to demonstrate its value as solution finders and game changers. Let’s embrace it and show how we can help achieve more in the “Era of Less”.