We have been talking about the tightening of the economy, how to partner when times are tough and now cutting back on budgets. Most companies, when it is time to cut back on budgets, cut their marketing budgets.

The recession is here, and anything that can be cut will be cut. And most of us, don't really know where to start or, for that matter, when to stop fighting the cut of yet another 20%.

There are no definitive answers!

Martin Lindstrom from Click-Z Network shows us some options a range of marketing directors, senior VPs, and Chief Marketing Officers have tried over the past decade when they found themselves in just such a situation.

1. Ask your customers
Before cutting anywhere, take a couple of days to evaluate your position.
- How do you rate your customer awareness
- Is it high enough, or do you need to pay attention to your customer maintenance?
- Is your brand's value proposition well established, or do you have a diffuse brand image out there?
- Have you differentiated your brand from your competitors', or is your brand lost amongst others in its category?

These questions may be simple and you may already have answers to all of them. But a recent Forester Research survey shows that most marketing directors forget to define answers to these questions before they start cost cutting.

Far too often they arbitrarily remove the 'less safe' media investments - such as online, direct marketing and billboard commitments - as an easy cut. In doing this blindly, they ignore the untested possibility that one or all of these apparently dispensable elements may have been of great value to customer awareness - promoting the brand's value proposition and its market differentiation. Remember: Ask your customers about your brand's status before you consider cutting the "easy" stuff adrift.

2. Be creative
Having evaluated your brand's position by assessing your customers' perceptions of it, try to approach your brand management both tactically and creatively. Wireless carrier Orange, for example, offered students in San Francisco a free paint job for their cars. The only condition was that the paint colour had to be the Orange orange! Now, imagine the cost of this tactic against the value it gained the brand in the streets and in the press. Being creative doesn't necessarily cost a fortune. But it can save you one.

3. Don't forget to build your brand
Some years ago, Shell decided to redirect its total marketing budget into direct marketing from Denmark. The response was great. But after two years, brand awareness among the population was as low as ever, so low that it was starting to affect sales. Devoting its marketing investment into one media channel didn't do the trick. And the real danger in the years of this single-channel strategy was the chance that consumers would forget the brand.

Remember: By this stage you've probably invested millions of dollars in building your brand over the years. Why destroy that effort and investment by putting restrictions on your budget's application?

4. Evaluate your partners, but don't start all over again
A classic cost-cutting move is changing suppliers to gain lower prices. This won't help you in the long run. Most of your expenditure is probably on media anyway and all you can cut are the agency and print fees, which are marginal in the total scheme. More important, your agency probably has years of experience in handling your brand. If you were to switch to another agency during a crisis, you will lose at least six month's momentum in just running the pitch again, changing the focus and building a new campaign. Could this possibly be worth a 1% saving? I doubt it.

5. Be consistent
Cost-cutting time is no time to change your branding style dramatically. What customers really want now is consistency. Customers want a brand they can trust, believe and count on. Don't change your branding style because you have to save money?

Only time will tell how well your tactics will work, but hopefully these tips from Martin Lindstrom will help you avoid some major pitfalls.

Winnifred Knight, email win@cubesquare.co.za or phone 082 575 9922

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