Yesterday, I heard news from a Pakistani Businessman that Pakistan Export Board has cut their marketing budget by 75%.When he asked reason, officials told, due to economic position of country and overall world-wide recession, they have to. He asked that official, when business is down, is it wise to shutter down the shop or make more efforts to get business? That official had no reply. And I am sure, most of us don’t have reply for the same. For example, by cutting down marketing budgets, what we do actually? We make recession worse, as we cut the way to get new business. Marketing is not a choice; it’s a necessity and must for growth. Yes Marketing is a tool that can actually bring you out of bad effects of recession.
“There are two ways of dealing with the crisis. One is to put your head in the sand and cry every day, and wait for the inevitable,” “The other, is to try and do something about it.”
Here are my 5 tips to be winner during recession.
1. Don’t find easy solutions:
Cutting the cost by laying off employees, cutting advertising or reducing inventory levels, all usually results in lowering sales. It reduces company morale and resulting poor customer service. So these easy solutions actually make bad time worse. Its much better to think out of box, rather than cutting costs, concentrate to find more ways to sell and strengthen your relations with existing customers to get more sales from them.
2. Recession is a Threat? No, it’s an opportunity:
For small business, Economic downturns generate new opportunities. It’s a famous saying in Pakistan, “when one door close, two new opens”. Here are some tips:
- Increase your advertising and marketing efforts. When every one is cutting costs by reducing marketing budgets, your voice will be heard more clearly. Use more effective methods of Advertisement and Marketing.
- Pay close attention to your customers. Listen complains, get feed backs and make your service better. Existing customers will bring new customers for you, if they are happy.
- Make a stronger follow up system. Use some CRM, to maintain records of your customers, prospects and leads. Let your customers feel, you care.
- Less Competition: yes, finding easy solution, most of business will loose their customers. And you can grab them with better offerings and better services.
3. Stick to Fundamentals:
Stick to fundamental business rules studied during MBA classes.
- Pay attention to find better and low cost suppliers. Make negotiations with your existing suppliers to cut cost and make their supplies better. Obtain quotations from Competitor suppliers on regular basis to check cost and quality.
- Value each customer. Don’t let any deal go.
- Its best time to adopt Activity based costing. Measure and watch each cost Activity closely. Measure Employee performance more closely and relate that directly to projects. Measure your Advertising Cost and compare it with results, etc. Everything that can be measured can be improved.
- Be at your best. Start Every Day like a new start. Make objectives for the Day, Week and month and struggle hard to achieve them. Make small betterments every day. It will make things in-control for you.
4. Avoid Interest:
Do you know why China is facing less recession effects than America and Europe? Buy Luxury for you with amount you have and don’t take loans on interest. It will add up your financial crisis and mental stress. Even the business buildup on Interest may fall down quickly during recession.
5. Refuse to Give Up
When you are ready to quit, you’re closer than you think. Make it you main goal to survive this recession. Every-one can reap benefits when there are good times. Real winner is: who pass through tough times. Work hard and refuse to give up, and you will be the winner.
What’s Next?
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I totally agree with you. We just have to use our marketing dollars wisely. I received data stating that promotional products are an excellent alternative to more expensive advertising. A survey conducted by the Advertising Specialty Institute (ASI) found that the average cost per impression of an advertising specialty (Promotional Item) is $0.004. Promotional items like calendars and grocery bags actually have a lower cost per impression at about $0.002. I like grocery bags with a company logo imprinted on the front side of each bag for two reasons. One, many grocery bags are eliminating the need for plastic bags every time we purchase items at the grocery store. Two, grocery bags have a large imprint area allowing the logo to be viewed by many patrons. I also like calendars because they are inexpensive (many are less than $2.00 each) and your logo is in front of potential customers 12 months out of the year. The average cost of $0.004 per impression make promotional products a worthwhile investment for marketers.
You raise some interesting points and suggestions that make a lot of good sense and should be considered as much during the good times as in the bad times when funds are tighter.
The problem is that during the good times businesses generally tend to spend more, some might even say that they over spend and not necessarily wisely. During the good times when funds are more easily accessible, many organisations aren’t perhaps as diligent with accounting for the value that they are getting for their investment. They don’t look too closely. Like the price correction that has happened during the housing market as a result of this economic downturn, we should not be surprised of a spend correction happening in corporate budgets.
The problem as you so rightly highlight is when that spend correction either goes too far, too low or when it is a knee jerk reaction that is based more on herd mentality than sensible and pragmatic strategy. Unfortunenately, sensible and pragmatic are not characteristics that are generally in abundance in the business world, or in the wider world at large. If they were, then perhaps we wouldn’t necessarily be in this awful mess.
Being innovative is not always a good thing (we now know that too much innovation in the financial markets has brought world economies collectively to their knees – not surprisingly there wasn’t also lot of sensibility or pragmatism either ). But I do share your belief that now is a time of great opportunity providing you are sensible and pragmatic.
Very interesting tips : What is the best CRM system I ca use to matain records of customers follow up, prospects and lead?
I rum a recruitment and staffing consultancy and have recently developed a new account. I’m trying very hard to build relationship with this new client and get repeat orders and have sent feedback questioner asking the client to comment on our service level but receive no reply. I have also recently requested a client visit but the client have not acknowledge receipt of my email. I am trying to pay close attention to this new customer. How can I get feedback and get my service better for this customer?