The marketing budget is quite often the first to be slashed when the economic outlook worsens and the order books start to slacken. The UK construction sector has seen prolonged limp market activity since the wider slowdown in 2009. This is why construction firms have been looking inward and cutting whatever they feel is not strictly necessary.
Such short term actions can be detrimental for the company in the long run. If a construction company increases or sustains their marketing budget in a time of economic gloom they should, at some point, expect a positive return on their investment. When things pick up customers are going to spend with the supplier they have the relationships with. Any marketing spend should be measured against coherent marketing and company objectives. Measuring and tracking marketing activities has never been so important. If marketers can prove their activities produce results then there shouldn’t be a problem in securing budgets. The onus is on the marketer to prove that having a marketing presence is financially worthwhile for the company.
The UK contractors group states that every £1 invested in construction generates £2.84 in economic activity. Although there are variants on the amount generated in economic activity it is widely accepted that if you invest in infrastructure and construction projects there will be a positive social and economic return on investment.
This may go some way in explaining why George Osbourne has today (18 July 2012)
announced he will be providing guarantees for up to £40 billion worth of projects in the National Infrastructure Plan. There will also be a £6 billion lending programme to kick start stalled public and private partnership schemes. This will be a welcomed initiative in the construction sector that has seen a hesitance to invest stunting many major and mid-sized projects.
If the marketing budget is spent wisely companies will be better placed than their more conservative competitors when the market picks up or when something like the guarantee or lending programme kicks in. The contractors and companies who have stayed at the forefront of their customers minds will be first approached when customers start spending again. This is true for contractors, sub-contractors, consultancies, building product manufacturers and equipment manufacturers.
