Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to the newest version of your browser.

Your browser appears to have cookies disabled. For the best experience of Construction News, please enable cookies in your browser.

Welcome to the Construction News site. As we have relaunched, you will have to sign in once now and agree for us to use cookies, so you won't need to log in each time you visit our site.
Learn more

Whatever happens, don’t let your marketing budget get cut

For marketing executives looking to keep their budgets and headcounts intact, a vital part of the battle is demonstrating that marketing adds significant value to the business.

At Leading Edge, we have been running the State of the Industry Construction Market Barometer since the start of 2008 and it shows that large marketing cuts often leads to lower sales growth when the economy starts to recover.

The Barometer, run in association with the Chartered Institute of Marketing’s Construction Industry Group, tracks marketing budgets and headcounts and is completed by 50-100 senior executives on a quarterly basis.

Looking back to the recession of 2008/09, the figures show marketing budgets and headcounts being slashed at an alarming rate across the industry in response to plummeting sales figures.

But, when you dig down, the data highlights why cutting marketing spend too quickly and too deeply can have damaging long-term consequences.

In fact, the vast majority of those companies that have cut the least, or even grown, their marketing spend over the last four years are now reporting the strongest sales growth. Proof that effective marketing is vital for sustained revenue generation.

The barometer also tracks which strategic issues are at the top of marketers’ agendas. Some common themes have emerged from the data, and if marketers can get to grips with these strategic issues then they will be better placed to demonstrate the ‘value of marketing’. For example:

  • Can you spot early on if your core markets are likely to contract and where new opportunities can be found?
  • Do you understand what products and services your customers need and is the organisation capable of launching a new offering before the competition does?
  • Have you carved out a niche where you can offer your customers real value and maintain your margins?
  • Do you know how your competitors are likely to react in a market where workloads are falling and if new competitors are likely to emerge?

What’s the outlook for 2012/13?

The latest barometer results show that just over four in 10 construction businesses are expecting to grow their marketing budget over the next 12 months, with two-thirds of respondents expecting no change to their marketing headcount.

However, 43 per cent of companies predict their core markets will shrink over the next six months, mainly due to a rapidly declining public sector and a weaker than expected private sector recovery.

This finding backs up the reported 5 per cent fall in construction output in Q1 and the negative output forecasts for the remainder of 2012.

With an uncertain outlook the question now is, can marketers demonstrate to the rest of their organisation that the marketing budget is the last one that should be cut in tough economic times?

The latest State of the Industry Barometer report can be downloaded at

Nick Holloway has more than 12 years of experience in the construction industry and is now a senior manager at Leading Edge, a market research and strategy consultancy specialising in the construction and manufacturing sectors. Nick is an experienced project manager and chartered marketer and is also a member of the organising committee for CIMCIG


Readers' comments (1)

  • geniusocket

    Our video marketing agency has seen a huge surge in B2B projects because of a unique business model that allows us to charge low costs for high quality, high impact video campaigns. The marketing sector is adjusting and creating new business models to respond to companies that have to deal with slashed marketing budgets- companies should seek out what's out there for them so they can do more with less marketing money.

    Unsuitable or offensive? Report this comment

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.