What does Brexit Mean for UK’s Digital Marketing Industry?
By: Yigit Erol
Tags: Brexit, Marketing, Digital Marketing, UK, Social Media

Let’s take a closer look at Brexit with its opportunities and challenges for the digital marketing industry.

As of December 31, 2020, the transition period will end. The government continues to work to ease the pain of the process. One of the areas that will be affected by this transition is the UK’s digital marketing industry, which we will examine in detail below.

Although leaving the European Union is a much-debated radical decision, we will not dwell on it here. Of course, this will have both positive and negative effects on the sectors. However, what matters is how much we can benefit from positive effects and how much we can turn negative effects on opportunities. Let’s examine the effects and opportunities of Brexit on the digital marketing industry under different headings.

Budgets

The IPA’s long-running Bellwether report shows that after 6 years of growth, marketing budgets have been further cut in recent years. Uncertainty has brought consumer confidence to a low level, which means they spend less. Marketers are also losing confidence in the British economy and withdrawing their spending. Do you think this is the right strategy?

Marketing is an easy budget to cut when businesses are concerned about the future. This is actually a mistake as spending money on marketing is the key to long-term growth. If you choose to remain inactive, you run the risk of losing customers you already have if the economy goes into a downturn. This creates a vicious circle where investment in growth becomes increasingly difficult.

The opportunity here is to see the competition that will weaken for the potential customers you are trying to attract while your competitors tighten their belts on marketing. Brexit marks a time to spend more, not less, on marketing. Otherwise, there will be no reason for your existing customers not to prefer your competitor who does not cut the budget. Finally, managing customer expectations and protecting them from exchange rate fluctuations by providing them with value-for-money products and services can have a long-lasting effect on building their trust in your brand. Another view as an opportunity is that if the pound continues to fall with the Brexit against the dollar and euro, more visitors will come to the UK. This will lead to an increase in advertising budgets with growing tourism and spending, and the digital marketing industry is expected to continue to grow despite the pessimistic approach to the issue.

The Falling Pound and Rising Cost

The Pound has been losing value against the Euro and Dollar since the moment Brexit started to be talked about. Increasing costs inevitably arise in the digital marketing industry as in many other areas. There are many US-based digital marketing tools such as Mailchimp, Hootsuite, Hubspot, and Adobe; based on the depreciation of the Pound against the Dollar and Euro, the monthly/annual subscription prices paid by companies for these services increased. Costs in the supply chain have also seen an increase, making marketing more expensive to offer in the UK.

The opportunity should be to support local initiatives against the increasing costs of US-based marketing tools. This approach, which will allow you to use your marketing budget more effectively, will also strengthen UK-based startups on the way to globalization.

Recruiting

Many sectors in the UK have benefited from the free movement of workers from EU countries. Following Brexit, it may not be that easy to hire from abroad, and this could affect companies managing an in-house marketing team more than those who don’t. Nowadays, most working people who are not British citizens have started to return to their countries. This situation creates an employment shortage in the United Kingdom. At the same time, the decrease in the number of qualified employees started to make companies difficult.

What can be done: To maintain an in-house team, you may need to spread out your network for the required expertise or invest heavily to scale up your team. Besides, you can outsource some works in order not to disrupt the workflow.

Investment

Despite the Brexit uncertainty, it has been buoyant for the UK economy since 2016. The decrease of the pound making the country an attractive market for inward investment. If the pound continues to depreciate relative to the dollar and euro after Brexit, this appeal will continue, especially when combined with inward investment incentives such as corporate tax reductions.

The opportunity: UK businesses may find it easier than before to acquire new customers in the EU, US, and elsewhere; Another reason to consider maintaining your marketing spending and exploring alternative markets.

GDPR and Data-Flows

The UK and the EU will continue to stay in a very close alignment for the foreseeable future, particularly in terms of regulation and recognition of goods. There will also be continuity in data transfer and marketing, as all the UK and EU countries will continue to be governed by the GDPR legislation that came into effect in 2018.

Relationship Management

Many businesses rely on a core customer group, so understanding how Brexit impacts your big customers and their customers is an important strategy. As part of your marketing, make sure you understand the impact of Brexit on your customers and reflect it on your marketing.

The UK government’s Yellowhammer report recently outlined several areas that could face disruption, including transportation, fuel, medicine, and food. So if one of your customers is working in a related industry, or if you anticipate problems with the supply chain, it’s important to think about how to alleviate these problems now.

Digital Marketing Presence

Brexit can lead to companies being denied opportunities to access international markets, and the same can be said of international competitors entering the UK market. Being optimized in local SEO will become crucial in capturing potential customers in your local area while focusing on jobs in the UK.

Future of Marketing

Aside from all the pains brought by Brexit, marketing will contribute to the growth of companies. Marketers are increasingly responsible for delivering a clear brand message, understanding the changing needs of the market, and keeping customer trust under control. When you start planning for 2021, there are many things you need to change, from consumer attitudes to brand psychology, and don’t ignore Brexit.