No one disputes that our economy is on a wild roller coaster ride as we find our stomachs in our mouths with every plummet.
So what do you do with your business in an economic downturn? For many smaller and mid-market companies the marketing budget is one of the first things that go. Whatever you do, don’t stop marketing. Lead generation and lead nurturing are keepers or your sales take a dive (no matter what shape the economy’s in). It's important to continue investing in marketing and integrate a variety of marketing tactics per our latest “Marketing to HR” eBook.
Our new eBook outlines the proven framework we pioneered called the Marketing PR Lead-Gen Process (SM) and will help you increase your visibility with HR decision makers and generating increased website traffic, higher organic search rankings and, ultimately, more sales leads.
Keep building no matter how far the drop. In the latest Fortune, Ram Charan (business guru and author of many management books) lays out 4 rules of what businesses should do in a downturn:
Posted by Kevin Grossman
- Keep building. When the top line looks shaky and the bottom line worse, the temptation is to go after discretionary spending. Fine - but do not consider product development, innovation, and brand building optional (see above!). Sacrificing your future for a slightly more comfortable present is not worth it. If you keep building, you can come back strong.
- Communicate intensively. Get information from where the customer action is, and get it to the operating people - fast. Companies should do so routinely, of course. But they don't. It's counterintuitive but true that when the economy slows down, the pace of decision-making has to speed up, because you can't put off the tough choices anymore. The companies that are readiest to act on solid information are primed to shoot ahead of the business cycle.
- Evaluate your customers. In good times, companies manage the P&L; in bad times, cash and receivables matter more. Therefore, you need to identify your higher-risk, cash-poor customers. You could decide to simply not supply them anymore - that's harsh but sometimes necessary. You don't want to be this decade's Nortel or Lucent, which continued to ship to companies whose ability to pay for equipment, it turned out, was nil. Alternatively, and this helps build good relations, work out a way to keep going - for example, by helping finance purchases or supplying smaller quantities. The point is, a downturn is a very good time to do a quality check on your customers.
- Just say no to across-the-board cuts. By all means cut costs if it makes sense to do so, but make sure there is purpose in how you do it. It may be useful to clean out the metaphorical attic - for example, by pruning your product line. Procter & Gamble (PG, Fortune 500) did that in the late 1990s and early 2000s, shedding stagnant brands like Comet and Crisco. It then used that money to invest in higher-growth areas, to good effect. It was painful for P&G to sell off such historic entities, but doing so delivered a strategic punch that slicing 2% here or there would not have. The key: If you have to cut costs, don't try to be fair about it. As I have said before, the world does not inflict pain evenly, and you have to deal with that reality.
Labels: economic downturn, marketing, media visibility, Ram Charan, sales leads, selling to HR, website traffic