When growth softens and prices won’t quite behave, marketing budgets are often first on the chopping block. It’s understandable – CFOs want certainty, pipelines wobble, and board packs suddenly feature more red than green. But if you’ve been through a few cycles, you’ll know this is exactly when smart, well-measured marketing earns its keep.
Let’s set the scene in the UK. The economy expanded by 0.3% in Q2 2025, down from 0.7% in Q1 – still growing, but slower, with services doing the heavy lifting. (Office for National Statistics) At the same time, headline CPI inflation ticked up to 3.8% in July, with services inflation staying sticky at 5.2% – the sort of price pressure that squeezes margins and keeps consumers cautious. (Office for National Statistics) The Bank of England shaved Bank Rate to 4.0% on 6 August, offering a little relief on borrowing costs, but no one expects a return to the ultra-cheap money era. (Bank of England)
So we’re in a familiar but awkward place: growth is there, just not abundant; inflation isn’t out of control, but it’s not benign; and capital isn’t free. In this environment, it’s tempting to sit on your hands. The data – and experience – suggest that’s a mistake.
What the numbers imply for your marketing
1) Demand hasn’t disappeared – just become choosier. Real-world-useful stat: services inflation at 5.2% means households feel price pressure most in the experiences and everyday services they notice. They still buy, but they trade down faster and switch brands if value isn’t clear. (Office for National Statistics)
2) Cost of capital is lower than it was – but still meaningful. A 4.0% Bank Rate means boardrooms will keep asking for payback windows and measurable ROI. Plan for evidence-led campaigns with time-boxed tests and clear success thresholds. (Bank of England)
3) Your competitors are blinking. Despite the caution, UK adspend rose 8% year-on-year in Q1 2025, and full-year spend is forecast to grow ~6.8%. In other words, the market is still advertising – just more selectively. If competitors pull back in your category, your share of voice is cheaper to win. (Advertising AssociationWARC)
4) The long-term evidence still holds: brands that maintain or smartly increase investment in downturns grow faster in recovery. That isn’t folklore; it’s been observed repeatedly in IPA effectiveness work. (IPA)
Five practical plays for the next 90 days
A) Clarify your value story and prove it. Inflation has trained buyers to scan for value. Tighten your proposition (price, promises, and proof). Swap vague benefits for outcomes, benchmarks, case stats, and testimonials. Where you can, quantify the time saved, cost reduced, or risk removed.
B) Squeeze more from your first-party data. This is not the quarter to leave money on the table.
- Run re-engagement flows for lapsed subscribers and past purchasers.
- Build simple RFM (recency/frequency/monetary) or lifecycle segments and tailor offers by segment intent.
- Add low-friction zero-party data capture (two-question preference polls, quiz steps) to lift relevance without hurting conversio
C) Clean before you scale. Deliverability and wasted impressions are the hidden tax of a downturn. A quick data cleanse (dedupes, goneaways, MPS/TPS screening, suppression updates) can lower CPA and raise trust signals faster than another creative tweak. If you want a hand, our data cleansing team can run a free audit and fix the nasties (PAF, deceased, movers) before you mail or call.
D) Balance brand and demand with discipline. In tighter markets, we see two mistakes: going 100% lead-gen and burning lists, or hiding in brand “warmth” with no commercial spine. The winning pattern is a balanced split and connected measurement:
- Upper-funnel reach that grows mental availability in your ICP (efficient video/audio/display, direct mail for high-value segments).
- Always-on demand engines (search, partner email, sponsored content) tuned to qualified intent.
- Shared KPIs that ladder up: qualified site visits → engaged MQLs → revenue, with lookback windows that reflect realistic sales cycles (don’t judge enterprise deals on a 7-day click).
E) Buy where attention is mispriced. In slowdowns, pockets of media get cheaper – particularly where competitors retreat or seasonality shifts. Test retail media, sponsor slots in curated newsletters, and postal for high-LTV audiences. Keep tests small, hypothesis-driven, and ruthlessly compared on incremental lift.
Channel-by-channel quick wins
Email:
- Refresh core automations: welcome, cart/lead abandon, post-purchase (or onboarding).
- Segment by inflation sensitivity (e.g., long-interval repurchase vs. frequent small baskets) and flex the offer mechanics accordingly (bundles, subscription incentives, “price-hold” guarantees).
- Monitor list health weekly; prune hard bounces and persistent non-openers to improve sender reputation.
Direct mail:
- Use postcode and lifestyle segments to build small, high-relevance cells; keep creative simple and proof-heavy.
- Control-test mail vs. holdout and measure assisted digital conversions via QR or short vanity URLs.
Paid search & shopping:
- Split branded vs. non-brand budgets; protect your own terms efficiently and chase marginal gains on high-margin SKUs only.
- Deploy query-level negative lists more aggressively – wasted spend hurts more when growth cools.
Social & video:
- Lean into creative breadth (5–10 variants) over micro-targeting; let platform delivery find pockets of cheap reach.
- Use attention metrics (hook rate, completion) alongside CPA; in noisy feeds, creative quality is the lever you fully control.
Data & audience:
- If your universe is limited or stale, expand legally with targeted prospecting data (B2B or B2C) and lookalikes – then warm them via content before asking for the sale. We can supply compliant B2C/B2B data and run email campaigns if you want a single team to source, clean and activate.
Budgeting and measurement that survives the board pack
Set “lines in the sand.” Agree in advance what you’ll not cut (e.g., brand reach to priority ICP) and where you’ll flex (e.g., experimental budgets). Document this in the plan so everyone’s aligned when pressure arrives.
Adopt a two-horizon target. Horizon A: 90-day revenue metrics (CPA/CPL, conversion rate, payback). Horizon B: 6–12-month signals (share of search, returning customer rate, average order value, LTV). Both matter in a slowdown; only reporting Horizon A will slowly drain future demand.
Build an incremental habit. Where feasible, hold out geo or audience cells and run matched-market or switchback tests. Even a small, continuous control gives you clarity when macro conditions shift weekly.
Keep your finance partner close. With Bank Rate at 4% and inflation still above the 2% target, finance will rightly press for rigour. Bring them into planning early; align on payback windows and the size of the “learning” budget. It’s far easier to defend spend you’ve co-authored than spend you’ve “requested.” (Bank of England)(Office for National Statistics)
The bottom line
Slow growth and sticky services inflation make this a thinking person’s market. The brands that will exit 2025 stronger aren’t necessarily the ones spending the most – they’re the ones spending well: clean data, relevant creative, balanced funnel, and calm, incremental measurement.
If you’d like a second pair of hands on audience strategy, compliant data sourcing, and the campaigns to activate it, we’re here. One well-aimed quarter now can set up the next two.