Marketing Budget During Economic Crisis Thesis

All these were achieved with immense marketing budgets.

In the current situation when the United States and the world are threatened by an economic crisis, the giant shoemaker continues to sustain an increased marketing budget. A specification that must be made however is that changes in the structure of the budget have occurred. In this order of ideas, the marketing specialists at Nike are more centred on interactive and innovative marketing, rather than traditional marketing operations. In a time of financial difficulties then, the number one shoemaker of the globe is trying to approach the audience using less conventional means. Nike officials argued that they were not in the business of keeping the media companies alive, but that their primary interest was that of best communicating with the audience. In this order of ideas then, the multinational organization drastically reduced marketing budgets for television advertisements and other traditional means and supplemented the budgets for innovative marketing campaigns. "Last year, Nike spent just 33% of its $678 million United States advertising budget on ads with television networks and other traditional media companies. That's down from 55% 10 years ago. [...]Nike -- the 800-pound interrupt marketing gorilla in the sports world -- is increasingly betting on social media, branded content and engagement marketing (where brands engage with the passions and values of their customers)" (Chandler, 2007).

4. Conclusions

Economic crises are generated by a combination of forces and affect organizations and individuals in a multitude of manners. The responses forwarded by each party depend on individual characteristics. Ford for instance decreased its marketing budgets, to then increase them; Nike on the other hand kept them at constant levels but distributed them differently.

However each economic entity will respond to the crisis as the management sees fit and in accordance with the personal features of the organization run, the outside observer can easily reveal a trend of reducing marketing costs when signs of economic crisis are presented. In this order of ideas, most players in the industry find it important to reduce operational costs in times of financial difficulties. Foremost, even those who do not entirely subscribe to this opinion will be easily influenced by the competition. "In times of financial crisis, many companies cut their PR and marketing budgets as well as their advertising budgets to save money. They look at their competitors and follow their example" (Word Press, 2008). This course of action is not always the best one however. Here are some reasons in support of this statement:

reduced marketing costs imply fewer advertisements the organization loses touch with the customer base they mostly rely on the loyal customers and do not attract new clients (and gaining new customers in difficult times is crucial for survival) the marketing campaigns are poorly implemented and have little relevance for the consumer most companies will tend to implement such strategies, meaning that they are more focused on internal issues and the competition within the market will be reduced (Word Press, 2008)

Works Cited

Chandler, T., Nike Gets Engaged, Shrinks Traditional Ad Spending. Here's How Copywriters Can Benefit, the Copywriter Underground, 2007, http://copywriterunderground.com/2007/10/22/nike-gets-engaged-shrinks-traditional-ad-spending-heres-how-copywriters-can-benefit/last accessed on October 16, 2008

Lovell, C., Marketing Budgets Cut at Record Rate as Economic Crisis Deepends, Brand Republic, 2008, http://www.brandrepublic.com/Campaign/News/852748/Marketing-budgets-cut-record-rate-economic-crisis-deepens/last accessed on October 16, 2008

McNamara, C., All About Marketing, Free Management Library, 2008, http://www.managementhelp.org/mrktng/mrktng.html. Ast accessed on October 16, 2008

Ford's Product Facing a Deepening Financial Crisis, Daily Times, 2006, http://www.dailytimes.com.pk/default.asp?page=200657story_7-5-2006_pg5_30last accessed on October 16, 2008

Innovative Marketing Campaign Puts Ford Flex in Front of Millions of Potential Customers, PR Newswire, 2008, http://money.aol.com/news/articles/qp/pr/_a/innovative-marketing-campaign-puts-ford/rfid136477139last accessed on October 16, 2008