Earlier this month, Elon Musk, Twitter’s new boss kicked off mass layoffs. According to media reports, the micro-blogging site wiped off its entire marketing and communications team in India. Musk completed the $44 billion buyout of Twitter on October 27 to take the company private. Since then, he has drastically sliced the company’s headcount. As per Twitter's latest filing with the Registrar of Companies, shared by business intelligence platform Tofler, the platform’s India unit swung into losses for the financial year ended March 31, 2022. This was partly because of a more than three-fold increase in its employee benefit expenses, despite a significant gain in operating revenue.
It’s just not Twitter, even social media giant Meta, has chopped 13 percent of its global workforce. E-commerce major Amazon laid off 10,000 employees in corporate and technology across the world too. At the moment, even a bunch of homegrown startups are struggling to retain talent in marketing.
Industry sources indicate that several marketing professionals from startups are reaching out to advertising agencies for roles that they gave up a few years ago. These professionals left agency corridors for a 200 percent to 300 percent hike for jobs at startups. Advertising agencies can’t match those digits but are open to conversations with these job seekers.
During dark times, one of the first functions to get a big hit is the marketing and communications department. There are several reasons for it. Layoffs, typically, happen when business or outlook for near-term business has contracted. “While a few organisations may believe it is the time to keep the brand awareness going, many realise that discretionary spends will come down and it may not be the best time to up the marketing effort,” opines Prabir Jha, founder and CEO of Prabir Jha People Advisory. Hence, both budgets and headcount contracts and the function sees layoffs, adds Jha, who was the former HR head of companies like Cipla, Reliance, Tata Motors, and Dr Reddy's.
Vivek Sharma, independent marketing consultant, and former CMO of Pidilite Industries and Philips India says, “Companies that align marketing functions with accountability, innovation, along with another key performance indicator (KPIs) will never let go of people. Companies that look at marketing merely as an extension of communications duties or simply have to follow a global template, slice down the headcount with no second thoughts.”
Sharma also believes in the case of startups that have no clear business objective, and recklessly spend funds, it’s an easy way out to give out pink slips to marketing professionals. Their focus then moves to only getting customer acquisition right and keeping the business moving.
Pratik Gupta, Co-founder, Zoo Media, which owns the creative digital agency FoxyMoron, views this as an opportunity for agency partnerships to grow. “Marketing is a cost center function. To keep the wheel moving, companies have to cut costs and balance things out. It’s not that these companies are neglecting marketing as a function. They will consider options outside,” he says. Gupta says brands will get on board consultants or agencies to oversee their marketing workflow. It’s a simpler model and will not impact their brand image.
Companies that align marketing functions with accountability, innovation, along with another key performance indicator (KPIs) will never let go of people. Companies that look at marketing merely as an extension of communications duties or simply have to follow a global template, slice down the headcount with no second thoughts.
Shashank Srivastava, senior executive director, marketing and sales, Maruti Suzuki India, says, that layoffs are often caused by the internal financial instability of a company. During such times, companies have to take tough decisions, but Srivastava thinks it can be handled better. “Issues like mass layoffs do impact the employer brand in the long run,” he thinks.
Jha also agrees with Srivastava. He says that employer brand does indeed get a beating when mass layoffs are conducted, fuelling a negative sentiment where current and potential employees sense uncertainty and a lack of loyalty.
“Unless done minimally and with sensitivity, layoffs disturb the trust quotient in companies. And when the firm sees a need for fresh hiring, either it does not always get the talent it seeks or it needs to pay more or offer parachutes to potential hires. Overall, it is a double-edged sword that must be wielded very thoughtfully,” he concludes.