Communication budgets, motivation or impediment for a DirCom?

Is budget appropriate? For what communication strategy? And which return on investment? many questions debated by people with various agendas.

Yes, communication budgets are always an issue that opposes the different stakeholders of a company’s communication. Communication departments feel limited in their action because they do not have enough budget at their disposal. Sales or development departments consider communication as a cost center and ask for a better management of its budgets. General management does not necessarily know what appropriate communication budgets are.

 Yes, communication requires budgets that can sometimes seem disproportionate to the tangible results of recognition expected by the various departments of the company. 

But the question of budgets would be partially resolved if everyone agreed on the communication ambitions and the corresponding means. 

To ensure a constructive debate on communication budgets and their adequacy to the company’s image and development strategy, it is important to frame the debate properly: what communication are we talking about, what budget is involved, what ambitions do we have, what options are available to make this strategy a success while managing the budgets as closely as possible?

What are the various communication types at stake?

Depending on the type of communication concerned, the decision-makers who set the ambitions, the judges of the results and the designers of the plans and their impact measurements will not be the same.

Communication can cover many different concepts depending on who is talking about it. Before tackling the question of the budgets needed for the communication department, let’s check with each stakeholder what he or she will include in this communication mission. Corporate communication is often a distant concept for business managers who think above all about promoting the image of their know-how and their products to their customers. Corporate communication brings together all the tools and means aimed at promoting the company’s global image, its values, its vision, its mission and its “purpose”. These concepts may seem far removed from the business and products, but if they are well communicated, they guarantee the durability of a company’s image with its stakeholders.

Indeed, a product can fail without the whole company being at fault. The company’s customers and stakeholders will be less likely to distance themselves from a company whose product has failed if they are aware of its more global mission in society.

Product communication or communication on a company’s business line, will have the mission of developing the recognition of this know-how among the clients directly targeted. This type of comms can sometimes be similar to the marketing missions that accompany the commercial strategy.

It is therefore easy to understand that budgets and corporate communication strategies cannot be left to the sole discretion of the business departments, but must be submitted to the general management.

In this way, communication strategies, the media to use, the competitors to follow and consequently the budgets to invest cannot be decided with the same interlocutors depending on whether it is a question of corporate communication or product and business communication.

Therefore, even before discussing the necessary budgets, it is important to clearly define the communications concerned and to involve the right people in the company in order to agree on the ambitions and build the appropriate strategies.

What communication budgets are necessary?

Let’s compare ourselves to those we admire or want to surpass. 

It can happen that the communication departments, experts in their field, do not always clearly explain to the company’s decision-makers the reason for the resources to be invested.

In the end, a budget entrusted to the communication department is paid, even indirectly, by the company’s profit centers.

Communication must therefore be accountable for the budgets entrusted to it, and justify its strategy, with regard to the ambitions set and the actions of the competition.

By bringing points of comparison to a direct competition envied by the company’s managers, the DirCom will be able to justify the strategy and the means he/she is asking for.

However, the precise data of communication investments of the competitors are not always available. It will nevertheless be possible to measure, for example, the state of development of competitors’ corporate communication tools or the extent of their presence in the media, advertising, or major events.

This indicator will be a good starting point to determine an image ambition for the company.

Market share drives share of voice for the leaders, but the opposite is true for the challengers.

But we should not neglect the level of recognition and comparative visibility of the players involved.

Indeed, it is recognized that the market share pulls the share of voice for the leaders while the opposite is true for the challengers. This means that a recognized market leader will have to make fewer communication efforts to maintain its level of notoriety and recognition, whereas a new market entrant or a less visible player will have to redouble its efforts.

Thus, the simple comparison with the invested budgets of a competitor will not always be enough to justify the necessary communication means of its challenger.

What are the means you are really willing to engage in comms?  

 Another important point must be taken into consideration in order to be able to evaluate the necessary communication budgets as accurately as possible : what resources are available internally to carry out certain communication strategies?

For example, there is a tendency to think that press relations strategies help to raise companies’ profile with lower costs than advertising, for example. This is certainly true, but not everyone can claim to be successful in press relations without first investing.

The necessary prerequisites for a successful press relations strategy in all company’s key countries will be expensive: it will be necessary to ensure the existence of trained spokespersons, recognized experts in their field (thus recruited at a high price), and available for the press relations exercise.

Another example is events that allow experts to meet their public. An undisputed market leader can afford to organize internal meetings (road shows) to which customers and prospects who need to know him will naturally come. On the other hand, a player with a growing reputation will not be able to avoid large-scale industry events that are often very costly in terms of sponsorship.

How do we ensure adequate budgets and buy-in from managers that will pay for them?

Staying connected to the business, understanding it, defending it, promoting it while building a corporate narrative that ensures management buy-in and pride in belonging.

The DirCom, the leaders’ best ally.

Without a doubt, the Dircom is the best ally of leaders in the success of their development.

This is what some managers may sometimes doubt.

Without communication, there is no chance to emerge in the noise of the competition. Without communication, there is no chance of establishing a lasting brand image that will ensure customer loyalty.

But the DirCom must remain intimately connected to the company’s values, its strategic ambitions, and the business skills that make it up.

The closer the communicators are to the business leaders, the more they understand the business and their competitive environment, the more they will be able to propose communication strategies that will enable them to gain market share, and will thus be endorsed by the company’s management.

The DirCom is also at the helm when it comes to writing and promoting the company’s corporate narrative. It is the flagship to which each employee of the organization should be attached. This corporate communication approach must absolutely be built in collaboration with the main decision makers and behind all the employees, to ensure the onboarding of all and justify the corporate communication budgets that will be necessary.

In this way, corporate communication campaigns, which are often expensive and do not necessarily focus on one or other of the company’s business skills, will guarantee the support of all employees.

Although being a cost center, communication must measure the results of its actions

Because it is often difficult to attribute a commercial success to a communication action, we tend not to always measure Comms’ performance.

And yet, even if the links between cause and effect are not certain, it is essential to agree with all the departments involved on the performance indicators that will be monitored by the DirCom. These indicators will keep competitors in check and will also be a way to ensure the alignment of interests between the DirCom and other departments in the company.

Finally, another way to avoid endless budget battles, which prevent communication from doing its job properly, will be to ensure total transparency on budgets and to validate their allocation rules among each of the profit centers.

Why get help from a seconded DirCom, a professional outside the company?

The intervention of a professional from outside the company, a DirCom with long experience, will often be very useful in convincing internal management of the merits of a communication plan and the resources to be invested.

The @SkillsCommunication DirCom can, for example :

° Help structure a well-founded communication plan

° Integrate all the communication and marketing tools appropriate to the ambitions of each department and to the transversal corporate ambitions, without being limited to the usual practices of the company and to its internal means

° Bring in the experience of competitors and a neutral market vision

° Propose appropriate KPIs

It will then ensure the measurement and reporting on these performance indicators and will allow to think on the next steps in the communication plan.

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