Zero-based budgeting: Route to recovery or flawed thinking?
Marketers might be in search of a clean slate post-Covid, but is zero-based budgeting the answer?
As we emerge from lockdown and enter the recovery phase, many marketers might have the appetite for starting afresh.
One attractive option could be to gravitate towards zero-based budgeting (ZBB), whereby marketers start with a clean slate each year, rather than taking last year’s advertising spend as a benchmark.
ZBB has been adopted by a number of high profile brands, including tech giant Dell. When Alison Dew was appointed CMO in April 2018 she spent a large portion of her time digging through the investments across the marketing organisation. She identified that in the past the company made “sub-optimal” decisions by simply rolling budget forward without investigating any further.
This work was not carried out in response to the Covid-19 crisis, but was seen as an exercise in growing the business and focusing resources where they would have the most impact.
