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Why Defense Companies Are Arming Themselves For Marketing Warfare

As defense contractors adapt to a declining marketplace for their products, they are diversifying into areas where marketing plays a larger role.

Defense Contractor Diversification

In a Forbes article “Five Reasons Defense Companies Need To Start Getting Out of Defense,” the author Loren Thompson, CEO of the Lexington Institute, bluntly makes the case that seismic shifts beyond the Pentagon are signaling a long-term softening in demand for military goods.

The five reasons Thompson provides for the shifts that are forcing defense contractors to diversify in order to survive and grow include the global threat environment, the domestic political landscape, the federal budget, the economy and the popular culture.

Each of the five major factors driving demand for military technology are now pointed downward, a situation that has never existed before in the industry’s history.

  1. Threats – The Middle East is becoming less important in military planning and the U.S. is becoming less dependent on foreign oil.
  2. Politics – While Republicans have traditionally been more supportive of defense spending than Democrats, the Republicans are now more interested in cutting budget deficits than defense.
  3. Budgets – There will be increasingly less money available for defense.
  4. Economics – In 2001, both the U.S. global output and share of global defense spending was one-third. Its global output has slipped to 22%, but now represents over 40% of worldwide military spending.
  5. Opinions – While the military has remained popular in American culture, the defense industry is not. That's why elected officials protect military pay and benefits at the expense of defense spending.

If defense companies don’t get more aggressive about hedging their bets, they could be headed for a bleak future.

What can defense companies do in light of this structural change in defense spending?

Defense companies need to accelerate their search for new markets — commercial markets — before the budget walls close in.

In the process of diversifying into commercial markets, defense contractors are stepping up their marketing efforts. While marketing has not traditionally played a large role for defense contractors, it is now.

As defense contractors identify commercial applications for their products and services, they are having to quickly to develop awareness, preference and leads. Having a great product is not enough. This is where marketing is becoming important.

Ground zero for a defense contractor’s marketing efforts should be its website. And the way that website should be viewed is as a powerful magnet that pulls prospects in with useful, remarkable content that is focused on their buyer persona. Not gobbledygook about their company.

Smart defense contractors are making their website and content marketing their first priority. Advertising, direct mail, trade shows, press releases, if necessary, are secondary.

What do you think? Please join the conversation below. And if you found this helpful, please share it with your network.

The Principal and Founder of Artillery, Douglas Burdett is a former artillery officer and Madison Avenue ad man. He also hosts The Marketing Book Podcast, where he interviews authors every week about the latest in modern marketing and sales.

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