Marketing isn't the fat in your budget. It's the muscle.
Times of market uncertainty or economic downturn often produce the same boardroom reflex: marketing goes first.
It’s seemingly the easiest line to cut, the hardest to defend in a spreadsheet and the one most likely to be filed under ‘nice to have.’ As a commercially-minded C-Suite leader, I understand the instinct. When revenue is under pressure, anything that doesn’t look like immediate revenue starts to look like fat, ripe for the trimming.
But it isn’t fat. It’s muscle. It’s infrastructure. It’s institutional knowledge. And cutting it leads to an even greater future sales lag. You can’t switch it on and off for free.
I’ve heard the arguments before, so I know how they go, however, removing marketing leadership or freezing the function isn’t a cost saving. It’s a cost deferral: from payroll, where it’s visible and budgeted, to waste, delay and lost momentum.
You’ve already paid for the thing you’re about to throw away
For any leadership team considering reducing the marketing budget, this one’s for you. By the time you’re even discussing cutting marketing, you’ve usually already paid for the expensive part: building the infrastructure and tech stack, hiring, onboarding and training the team. The database cleanup, the ICP groundwork, the lead scoring, the workflows, the campaign and content planning. All of this rather unglamorous setup work that takes time to get right and start delivering for the business, both in brand and demand. If you pull the plug just as that infrastructure is about to start paying back, you don’t save the setup cost. You’ve already spent it. And you miss out on reaping the returns.
And it doesn’t end there. Marketing leadership won’t rehire itself for free. Recruiting, onboarding and ramp-up time all come back as a future bill, and given where salaries and tool costs are heading, that bill is rarely smaller than the one you just cut back. You’re not pausing a hard cost. You’re deferring it, with interest.
But we have Gen AI now, surely we can slim down marketing
Not so fast… AI isn’t the complete answer here. Yes, marketing is changing and having an AI marketing operating infrastructure and tech stack in place is absolutely the way forward, but there is no replacement for having smart, experienced ‘humans in the lead’. To borrow a sports metaphor, this could be a very expensive case of ‘all the kit, no idea’, if you’re expecting the agents to autonomously run marketing for you, with the judgement and nuance a real, actual marketeer would, think again.
Some cuts cost more than they save
Some marketing activity is genuinely discretionary, of course. You can evaluate your marketing mix and spend, and perhaps cut back on events, brand partnerships, paid advertising and the like. But be aware of the consequences. Brands that continue to spend during a downturn come out on top, vs brands that cut. Why? Building mindshare is cumulative, long-term and very expensive to rebuild once you turn off the taps. As McKinsey says, 'marketing should be at the table, but not the meal.’
The data already settled this argument
This isn’t a hunch. It’s one of the most heavily replicated findings in marketing.
Les Binet and Peter Field’s analysis of the IPA’s databank (996 UK case studies spanning three decades) found that brands maintaining a roughly 60/40 split between brand-building and short-term activation consistently outperform those who tilt hard towards activation, especially under pressure. Cut the brand-building side first, which is exactly what panic budgeting tends to do, and you don’t save money. You quietly dismantle the thing generating your future demand while keeping the thing that’s only ever harvesting it.
The downturn-specific data is even less ambiguous:
McKinsey's analysis across many years shows that “in moments of uncertainty, growth is the key to establishing strategic distance from competitors.” It should be seen as a key to long-term growth and they encourage adoption of a growth mindset when times are tough. Historic studies found that companies that kept investing through the 2008 Great Recession found their total shareholder returns outperformed sector peers by 150 percentage points over the following decade. Around seven in ten became sustained top-quintile performers in their industry.
Peter Field’s research on advertising in a downturn found that brands cutting investment can take up to five years to recover the ground they lost, long after the recession itself is over.
I caught up with Les Binet myself at a Future of Brands event recently, and his point of view on this was unequivocal: businesses that stop brand-building in a downturn don’t just dip, they see depressed sales for a sustained period afterwards. That’s not a one-off opinion. It’s the conclusion of decades of cross-sector effectiveness data, and he’s been saying it consistently for years.
The bill always arrives. The only question is when.
In B2B especially, where sales cycles already run long, the consequences of cutting now don’t show up now. They show up later, in weaker inbound demand, lower conversion rates and a higher cost to acquire the customers you didn’t nurture this year. By the time the damage is visible in the numbers, the budget conversation that caused it is long forgotten, which is exactly why this mistake keeps getting repeated.
The businesses that come out of a downturn ahead aren’t the ones who cut hardest. They’re the ones who knew what good looked like in their own marketing function, protected it accordingly, and used the downturn to get a jump on competitors who went dark.
I've seen this film before, and I know how it ends. If you'd rather head it off at the pass, let's have an honest chat.