Few companies are taking advantage of opportunities in recession

TORONTO - Canadian business and marketing executives overwhelmingly agree that an economic downturn means opportunity to increase market share, so long as you're willing to invest in your business. But converting belief into action is another matter.

This was one of the key findings of the Gauge Marketing Barometer, a newly launched annual probe into important issues in Canadian marketing. The study results were based on 207 random online interviews with senior executives across Canada completed in January 2009.

"We found that nine out of 10 senior executives agree that a recession is a good time to gain new customers and build market share with existing customers," says Brett Marchand, Executive Vice President and Managing Director of Cossette, Toronto.

"But, at the same time, most are reluctant to act upon the opportunity by increasing their marketing budgets," Marchand points out. The study also discovered a root cause of the disconnect, namely that both Chief Executive Officers and their Chief Marketing Officer colleagues agree that marketing's role in achieving business objectives is poorly understood inside most companies.

"Our goal is to stimulate dialogue based on the research and these fundamental challenges inside the C-suite should lead to some spirited conversations," adds Marchand, who hosted a panel discussion on the Gauge study and its findings in Toronto today.

"There is a belief that market share can be increased during a recession yet the majority of marketing budgets are being reduced or staying the same," says Julius Diamond, President of IMI International. "Simultaneously, senior executives report that they do not have sufficient ROI metrics. Measuring all marketing activity using the same 'ruler' is necessary to give senior executives the confidence to provide the budget and allocations necessary to achieve company objectives."

Panelists at the Tuesday morning session included: Bobby Brittain, Vice President, Sparkling Business Unit Coca-Cola Canada; Dave Frederickson, Vice President of Corporate Marketing, HP Canada; Susan Helstab, Executive Vice President Marketing, Four Seasons Hotels and Resorts; Brian O'Mara, Vice President, Chief Marketing Officer, McDonald's Restaurants of Canada Limited; and Larry Rosen, Chairman and Chief Executive Officer, Harry Rosen Inc. The Gauge partnership includes Cossette, marketing research company IMI International and Canadian Business magazine. Each year Gauge will conduct research into areas of current interest to Canadian marketing and business executives and provide insights that will help promote a dialogue between marketing agencies and clients.

Other findings and highlights of the Gauge 2009 Marketing Barometer include:

- Looking ahead to the coming year, senior executives are under pressure to build market share, however, 37% of CMOs and 24% of CEOs believe their marketing budgets will decrease.

- To gain market share, budget allocation will shift from traditional media and image-awareness building to price discounting, experiential and online media. Both online and price discounting were cited by 45% of marketers as the tactic to best attract customers, compared to traditional media, which was named as the tactic of choice by 22% of marketers.

- Only 29% of respondents indicated that they have ROI metrics that apply across different media, strong interest to measure media investment.

- Half of both CEOs and CMOs agree that the role of marketing in driving success is not well understood, and about a third of both marketers (38%) and business decision makers (33%) say that understanding of the role of marketing needs improvement.