Reducing brand spending in a downturn leads to market share declines

Reducing spend on brand marketing in unpredictable times can have various negative long-term results, according to new research from management consulting firm Boston Consulting Group (BCG).

Reducing brand spend in uncertain economic times can have several negative long-term repercussions for marketers, according to new research from the Boston Consulting Group (BCG).

The consulting firm analyzed 150 brands in 15 industries, leveraging data from 2017 to 2021, as well as drawing on findings related to periods of economic uncertainty in the 1980s and 1990s. It also surveyed 10,000 consumers and 100 marketers in mid-2022 to understand their behaviors and preferences.

And it found that companies which reduced brand-marketing spend typically witnessed a decrease of 0.8 percentage points in their market share compared with organizations that boosted their...

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