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Disclaimer

This is not advice. Items herein are general comments only and do not constitute or convey advice per se. The information contained in these articles is for guidance only and should not be relied upon without obtaining professional advice having regard to your direct circumstances.

 

Marketing in a downturn

Have you cut your marketing budget? That seems to be the first thing to go when business conditions get a little shaky. People look around for the easiest thing to chop, and marketing dollars just seem the simplest to guillotine. Sure, when budgets across the board have to be reduced, that’s understandable, but don’t make marketing your Marie Antoinette.

Why? Because continuing to market during a downturn is imperative to your businesses’ survival. It obviously won’t be business as usual, but that’s fine as it means you will get to experiment with the unusual. Your main aim during a downturn should be to increase your market share, so when business conditions brighten, you’ll be in the premier position.

“What?” you say, “Keep marketing? I can hardly afford my payroll.”

Yes, conditions are tricky. Yes, consumer – and business owner – sentiment is riding a rollercoaster. But let’s take a simple example of a pharmacy to show you how being adaptive can pay big dividends. There is hope!

I don’t know about your area, but in mine there are at least three chemists within viewing distance of each other. Now that’s competition! Let’s say you’re the owner of one of those chemists. You’re an astute business person, a keen observer of your customers. You chat with them regularly and have a good understanding of how they’re feeling about themselves, your business and the wider economy. Excellent, that knowledge will give you an edge.

And you need an edge because you’re suffering from a huge drop off in the number of items people are buying in the one transaction. Not to mention the decrease in overall revenue thanks to people buying lower priced items. Impulse purchases have gone the way of the dodo.

You know no one is going to spend more in these conditions, so what you urgently need is more customers. And the best way to get those new customers would not be continuing to run those “Weekly Special” ads in the local paper, but to completely overhaul your window display and all your marketing materials. You need to offer your customers value without being cheap and a great way to do that might be to change your key message to: “The Biggest Range of House Brand Medicines”.

That message screams “value”. When people are feeling the pinch, there is a large section of the population who will switch from brand name products to no name or “house” products. And once they’ve come into your chemist and experience your great staff and service ... they’ll probably stay with you long after the economy picks up and you’ve changed your window display back to expensive perfumes and high priced headache tablets.

Maybe you’re in the service industry. Talk to your customers. Find out how their needs are changing. Can you change your product or service or pricing or offering to suit?

Let’s say you’re a management consultant and your normal offering is a series of sessions of 6 months. You might need to reorganise your course/sessions so that you can hook the business with bite-sized chunks. Because that’s another thing you’ll discover in a downturn... the lead time to convert a customer gets a whole lot longer... especially if what you are selling is complicated or requires some kind of long-term commitment.

If you sell business-to-business, perhaps you might need to offer smaller quantity cases of your product to keep them moving and give retailers less fear of holding stock.

And trust... trust is vital. Customers need to know you’re going to make it through. If you’re all doom and gloom about your business... people won’t buy your gift vouchers or warranty-backed products for fear you’re not going to be around.

Finally, the other marketing tool I implore you to make use of is measurement. You need to be tracking every dollar. In the past it’s been easy to get away with not having measurement in place, but now more than ever it’s crucial to know which of your advertisements are truly working.

For internet advertisers, you need to know which key words actually end in a conversion. Sure, you might be getting 300 clicks on one of the words you purchased at $1 per click, but if only one of those clickers bought your $49 product... your competitors will be celebrating your demise before you know it, and they’ll be the ones gaining marketshare.

It’s not time to lose head, but it will pay dividends if you use these volatile times to revolutionise your marketing.

Michelle Gamble
My Business, Dec 08/Jan 09

 


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