During Economic Downturns, Investing in Creativity Is More Essential Than Ever. Here’s Why.

Editors note: This is a post for the LinkedIn Collective, which is designed to inspire excellence and success for all B2B marketers. The Collective will offer groundbreaking thought leadership and content resources informed by LinkedIn data and insights, our team of experts, and leaders across the B2B marketing industry.

These are uncertain times with many people and companies bracing for a recession . Interrelated factors like inflation, war, and the continuing impact of COVID-19 serve as cautionary signs of a coming (if not already materializing ) economic downturn. Marketers are taking heed and mapping out the path forward.

At Cannes Lions as we celebrated the creative industry’s enduring success through the pandemic and the new opportunity that lies ahead for the creative industry in B2B marketing, participants this year were quietly preparing for a recession , and reflecting on what it would mean for marketing.?

In 2020, as the fallout from COVID froze client spending budgets, Peter Field wrote about the best practices of advertising in a recession , arguing that long-term brand investments are as valuable as ever in these moments – a case supported by considerable data and evidence.

Right now it’s worth revisiting that topic and digging even further into the qualities that make branding memorable and conducive to sustainable growth. Namely: creativity.?

The good news is that marketing as an industry is poised to capitalize on the opportunities before it. However, barriers still remain.

Why brand and creative marketing are on the chopping block in a recession

Unfortunately, branding and creative marketing tend to be perceived as relatively “long-term” and “risky.” And marketers tend to have trouble convincing leadership to invest in “long-term” or “risky” during the best of times.

Despite mounting research around the direct revenue impact of quality creative , and our increasing ability to quantify and improve creative effectiveness , we’re running into the usual reservations. This year’s Cannes Lions survey found that 41% of brands still struggle to convince stakeholders to invest in creativity. Only 8% of agencies feel confident in convincing clients to invest in high-quality creative, and only 12% said they felt confident convincing their own CFOs.

It all comes back to a natural inclination that Mark Dziersk wrote about for Fast Company more than a decade ago, as businesses grappled with the 2008-09 recession: “In a down economy the natural instinct is to draw inward. Cut spending and pull back on initiatives.”

He added: “The problem with that approach is that a down economy may in fact be the best time to win by being creative.”

Is this line of thinking finally ready to break through? Are you ready to help lead the charge?

Why Investing in Creativity During a Recession Is the Right Play

As Dziersk argued in his 2009 article, and Field reinforced in his analysis of advertising during recessions, “Companies who slash investments in their Innovation efforts may find the damage to their long-term interests far outweigh the short term money savings.”

Focusing on brand-building and creative efforts during a recession is not only as important as it usually is… it’s actually more important. There are two compelling reasons why:

Recessions affect short-term buyers, too… and they don’t last forever

Field’s review of 50 case studies from recent recessions found that “some advertisers cut brand advertising spend,” but “because this was also the early period of big data, online advertising revenue actually grew by about 20% in 2008.”?

The brands that invested either 60:40 on creative branding versus demand gen or at the very least 50:50 actually did considerably better than those who leaned more heavily into demand generation at the expense of creative.?

That’s because while these strategic brands weathered the immediate effects of the downturn just like everyone else, they were in a vastly better position on the other end, having grown their audiences and share of voice.

The bottom line is that no amount of aggressive product-centric advertising will compel a buyer with no budget to make a purchase. However, branding campaigns are still effective in a recession – in fact, Field’s research suggests that emotionally impactful creative can work even harder in times of duress, where audiences face pressing challenges and stressful scenarios.

Few are doing it — and that’s a huge opportunity

“Gartner’s latest survey of chief marketers found that the proportion of budgets that go to brand versus performance is a roughly 50/50 split,” noted Peter Adams in a recent article for Marketing Dive . “That might make sense from a dollars-and-cents perspective, but doesn’t lead to a lot of eye-catching marketing that lingers in the imagination.”

Speaking of imagination, it doesn’t take a special one to deduce why branding budgets are being held in check.

As the B2B Institute wrote in 2030 B2B Trends: Contrarian Ideas for the Next Decade : “Imagine you are a CFO. One marketer comes in with a plan to deliver 10,000 leads for the sales department. The other marketer comes in with a plan to increase awareness by five points. Who do you think is going to get the money?”

Now, imagine you’re in a recession, so you’ve got to do more with less, and you need to show some results fast…

These days, marketers have a bad habit of letting perceived measurability of results—and not results themselves—dictate our approach. Only 4% of B2B marketers measure their campaign performance beyond six months. Three of four B2B campaigns are “optimized” within two weeks… and then never touched again.?

Can you see why this would be problematic as spending activity slows down??

In truth, this is as much an opportunity as a problem… and the canniest (pun intended) marketers at Cannes Lions were starting to get wise.

How Creativity Is Helping Brands Weather Storms and Win Big

Heineken won 21 awards at the 2022 Cannes Lions Festival of Creativity and placed fourth in the coveted “Brand of the Year” category. More importantly, the brand also came out of the 2020 pandemic poised to strike, outpacing the total beer market with 12.9% growth .

When asked how the beer company pulled off such an impressive feat, Heineken’s global head of brand Bram Westenbrink laid out a clear vision:?

“At the end of the day, we’re a company that’s long-term. We’ve been here 150 years, so we always focus on long term. The beauty of a recession, if you flip it, [is that] creativity only gets more important. Because the beauty of creativity is that every project has its values – money, time and people. But there’s one thing that can cut through all of them and that’s creativity. It’s the ultimate problem solver.

“I truly believe we’re always going to keep investing in brands. We’re there for the long-term. We learned a lot during Covid, we kept our investments and we will do that [again]. It’s also a greater opportunity for creativity when things are a little bit more constrained again.”

If and when the next recession hits, those who control marketing budgets and investments may set their sights on creative strategies and brand-forward campaigns. That’s okay, it’s their job to protect the company’s health and target any discretionary spending in the process.?

As a marketer, it’s your job to demonstrate why creative marketing is anything but a discretionary expense, and that the long-term health of the business depends on making smart, bold investments in this area.

The road ahead will be uncertain and challenging, but embracing creativity may provide an opportunity to cement your brand's role in the world, and exit recession as a more prominent player in your industry.