The Recession may be here; however, before you stress out, let’s review what past recessions have taught us about not only surviving a downturn in business, but identifying the silver lining and then using that to thrive. Here are a few tips from a three-time recession business survivor, Liz Harsch, Owner of Tailor-Made Advertising.
I did not set out to become a bit of a recession expert. However, my business has survived three recessions so far and it looks like the fourth one has arrived. Whether or not you are in the camp of those who believe that the much-expected recession is here, let’s look at what entrepreneurs can do to make the most of a business during a recession.
Let’s start with a look at the facts of the last three recessions, how long they lasted and what caused them. Here is Wikipedia’s summary of the three most recent recessions that I am talking about.
Now that we can see that we have been here before, here are some tips from the experts on what helped the companies that thrived during those recessions. I hope that some of these tips will be helpful to you. Remember, this will pass, so dig in and learn as much as you can now so your company will emerge stronger in the end.
1) Ask questions. Start by asking your customers what they need and how you can help them. Sometimes this is just what they need, someone to ask and someone to listen. At a time when you are feeling powerless, you can listen and sometimes opportunities are the result. Example: If you are a yoga studio and you have no attendees, ask past customers if they need lessons at home. Provide some free online lessons to show the quality and expand your reach. Then put together a schedule or on-demand videos and have your regular subscribers attend them free. Do not charge them the same price as in-person lessons. Instead, charge starting with their 4th lesson at a reasonable fee for access, with in-person lessons at a premium. Your clients need you and you need to think out of the box about how to help them when their finances are more limited.
2) Cut expenses where it makes sense; however, keep a marketing budget. If you stop marketing completely, customers will think you have gone out of business. Don’t just drop your conversations, let people know what you are up to and that you are here for them. Make suggestions on how your clients can thrive in their stay-at-home restrictions by sharing tips you find helpful and provide local news or updates. If people like them, boost them and try to get more likes during your store closure. Then when you are back, you can reach more contacts for less.
3) Consider increasing your marketing budget. If you are one of the lucky businesses that is not financially stalled by a forced closure, consider marketing more right now, as digital marketing has just gotten a lot cheaper and there are fewer competitors. In fact, you can get a lot for your investment and pick up market share while others are not advertising. But remember, many consumers are hurting so — in addition to promoting your business—also provide free tips, empathize and highlight local volunteers while praising the folks who are striving to get everyone back to work.
4) Conduct a survey. This is a good time to do a survey and find out what else you can provide for your customers (products or services). During times when expenses have to be cut, you may find that some of your products can be bundled for a better value, or maybe there are other markets that could use your products. Now is the time to diversify and not be dependent on any one type of buyer.
5) Offer discounts and/or value added services. Everyone will be cutting costs, so have a contingency plan for your customers. I have already received many discount offers. For example, without being asked, my phone company added Gigabytes to our family plan and my yoga instructor is offering free online classes. What do they know? That I will be a much more loyal customer if I think they feel the pain and are concerned with keeping my business over the long run.
6) Ask for help, negotiate with suppliers and manufacturers. Ask your manufacturers to change your terms and give you more time to pay. Ask your landlord and monthly service providers for a break. Check your monthly subscriptions to see if they are offering discounts or bundles during this period and check their competitors’ pricing. Also ask about bulk buying deals or anything that will reduce your costs but keep your merchandise flowing. Don’t wait. Start talking to your suppliers now.
7) Share solutions and challenges with others like you. Join SCORE, SBDC, Chambers of Commerce and other networking groups and brainstorm with each other. Many of them have Facebook and LinkedIn groups too. Often the best solutions have already been discovered by your peers and sharing those solutions can be the difference between surviving and thriving.
To get more done with your marketing efforts, create a media mix that marries your most effective traditional tools with digital media tools. Reach your target market more effectively and generate the required number of exposures to elicit sales and results. If you need help brainstorming to create your own recession-aimed marketing plan, contact us by email, or call at 310-791-6300.
Liz Harsch is the owner of Tailor-Made Advertising in Torrance, CA. Her firm provides marketing, training and consulting to identify marketing and media alternatives for business owners. As an experienced Marketing Director, Media Planner, Liz has trained small business owners for Constant Contact, SCORE, SBDC, SBA, Cities and MWD and County outreach partners, APICS plus many Chambers of Commerce for over 10 years. She can be reached at her Torrance, CA office at 310-791-6300 or by email at liz@adteamla.com. You can also see her upcoming training workshops calendar at http://bit.ly/workshopscal .
