As we approach budgeting season, marketers are preparing to develop their proposals to take a slice of the corporate budget, rather than the crumbs left at the end of the planning process. With the ongoing COVID-19 challenges affecting the hospitality industry, budgets will no doubt be tightened for 2021 and if your brand can’t see the value of marketing efforts, there may not be much left in the pot to utilise.
In a recent article for Marketing Week, JP Castlin, chief executive at Rouser, discussed an alternative approach to showcasing marketing’s value in driving revenue – relating it back to cash flow.
Castlin explained: “The value of a brand is generally seen as increasing if cash flows are. Conversely, if cash flows decrease over time, so too does the value of the brand. The value of the brand itself can be summarised as the sum of its discounted cash flows over time.”
By providing this objective and tangible result, business leaders can drill down to the ROI of the marketing spend and allocate sufficient resources to support the businesses’ promotional efforts over the next 12 months.
Since the beginning of the pandemic, it has been clear which brands have ceased their spending and those that continued to utilise budget for marketing activity. According to 80 Days’ second ‘Cutting Through The Noise’ research report, hotels who adapted and continued their marketing and communications activities saw a higher increase in bookings once they were able to reopen than those who cut all investment.
While businesses are not able to operate at their pre-COVID level, the awareness stage of the marketing funnel is arguably the most important. As the UK’s COVID-19 restrictions ease, businesses need to have built a large, engaged following during their slower months to ensure that their resurgence is as profitable as possible.
To find out how Custard can support you with developing your marketing budget and 2021 communications plan, contact a member of our team.
To read JP Castlin’s full article for Marketing Week, click here.
