Believe it or not, in 2009 alone, Amazon sales grew by 28% during the great recession. This came into effect mainly because Amazon continued to invest in innovation and increased the marketing budget, while others did the exact opposite.
Are You About to Follow the Crowd?
When facing difficult times, most CEOs and small business owners start reducing costs and selling cheaper. There is nothing wrong with this, but let’s get something straight, this is not the move that will save your business.
If we talk about “selling cheaper,” this is a strategy that could work if your entire business model works around it and if it makes you competitive in the market. When it comes to reducing costs, we could say that it is a healthy practice to avoid misspending your money on things that are not generating any revenue. But why would you want to stop investing in the one thing that can help you capture more value in the long run?
One of the most common reasons to do it is because ROI is a negative figure, meaning that no profit is generated from the marketing investment. But hey, if your marketing investment is not making a positive impact on your business, it’s not because marketing itself is worthless; this simply means that your strategy needs to be freshened up.
Is Being Conservative the Smartest Thing to Do?
Andrew Hoerner, an expert in the marketing field who is the current CMO at Coherent and who has worked as head of marketing for companies like McAfee, Securify, Symphony, and other Saas projects, has shared through the webinar “How to Market During a Downturn” some insightful ideas on what should be the right approach when a recession hits.
In this webinar, Andrew shared with the audience a brilliant analogy and three main steps we should follow in a situation like this.
1. Keep Flying the Plane
When things get ugly, our first instinct is to drop the ball. We all might get anxious, worried, and insecure when facing uncertain times. Still, the first thing we should try to do, regardless of these human thoughts, is to keep the plane steady, regain focus, and portray a reliable, knowledgeable, and solid marketing front.
2. Uplevel Your Team
One of the first actions you might consider when trying to reduce costs is to let part of your staff go. This is a reality for most companies, but how about strengthening your marketing team instead? Andrew mentioned something unquestionable. During these challenging times is when the competition gets more savage. Would you want to go out there to confront your competitors with a weaker team, or do you want the strongest soldiers upfront? This is something you might want to ask yourself before making any move.
3. Draw Your Marketing Mode Around Your Biggest Champions
This business survival pillar means that you must focus once more on strengthening your current relations with your customers and business partners. Think about it, nurturing your existing clients might be what is keeping your business afloat and not going outside and making cold calls.
In summary, Andrew shares with us that getting conservative and trying to play defense might be part of the problem of why you have a losing streak. So, get your game face on and make bold decisions. This is the business survival instinct we can’t leave behind.
So, How can you put this approach in motion? Will it work for the type of business you have? Let’s go ahead and answer these questions.
Businesses That Do Extremely Well in a Recession
First, you must understand that it will be naturally easy for some companies to thrive in times like these. The businesses that will always have a good chance to survive during difficult times are all the ones that provide essential goods, for instance, grocery stores.
No matter how bad the economy is, people will always need to eat, and not only that, since people will be in saving mode, they will probably stop going out to eat in restaurants and ordering food, so instead of grocery stores selling less, they have a good chance even to sell more.
Some other business types that tend to do very well, according to TONY ROBBINS, are:
- Health Care
- Candy and Sweets
- Beer, Wine, and Liquor
- Discount Retailers
- Children’s Goods
- Pet Industry
- Financial Advisors and Accountants
- Cybersecurity and Tech Support
- Debt Collection
- Freight Operations
If your business offers essential goods or services, this will be the right time to give it everything you got and become viral on all channels to increase awareness and come up with the best deals and promotions to boost purchase intent.
The Ones That Need to Get More Strategic
As I stated before, it will be simpler for some businesses to get better results during a downturn; while for others, it might get more complex. So make sure to know where you stand, and if you’re wondering if you should also adopt a bolder approach even if your business falls into the non-essential category, the answer is YES!
How Should You Play It?
First of all, you shouldn’t keep the same business strategy to market your products if times are changing. So, as a non-essential business, you need to analyze who’s still interested in buying your products. Be mindful of your location targeting, and don’t be scared to explore new horizons.
The second thing you can do is analyze how your customers’ needs can change and adapt. For example, suppose you sell home appliances. In that case, you might want to reassess your inventory and offer appliance parts for people that want to repair old equipment instead of purchasing new ones due to the economy.
Reinventing your inventory to keep your business on track is one thing, but you have yet to think about the “how-to” of other questions like:
How can you cost-effectively advertise your products? There are many different options with extensive reach and very competitive costs that you might want to consider.
SEO Is Always Crucial and Practical
As we have mentioned in our previous blog posts, Search Engine Optimization (SEO) is a good way to be organically and cost-effectively visible to your audience. All you need to do is find a team that helps you make your website as relevant and noticeable as possible.
Social Media Is Never a Bad Idea
These are two of the channels you can use to market your products in a smarter way that suits your business’s needs when experiencing some turbulence.
It’s Time to Decide Whether You Want to Go Big or Go Home
Nobody has ever reached the top by letting others set the standard. To get ahead during a downswing, you must constantly reinvent your business strategy and try innovative solutions that grant you that first place in the market.
Keeping in mind the lessons we’ve learned from Andrew and our own experiences, we can advise you to be bolder and look for new ways to take your business to new heights.
Things You Shouldn’t Forget
- Make sure you have a qualified team to bring the best to the table.
- Strengthen your business relations with your current partners and loyal consumers.
- Be aware of where your business stands in the market.
- Determine whether you should keep the same business strategy or reinvent it.
- Assess the most cost-effective ways to advertise during a downturn.
Last but not least, remember that proper preparation prevents poor performance. Find various alternative digital advertising strategies that can make a real difference for your business during difficult times in our free content section.