A Google search on the term “New Normal” today produced more than a million hits. It’s been in use for a while — going back to the tragic events of 9/11 in 2001.
The term is used widely today, although it applies to the economic tragedy that is still unfolding — such as GM’s new 60% ownership by you and I. That we’re in a vastly different economic world than just a year ago is a massive understatement. The challenge for small businesses is how to prosper in an economy that has fundamentally changed. Here are a few thoughts on how I think small, nimble firms like yours can and should respond to improve their marketing position for profits and growth.
First and foremost, DON’T PANIC!
As volatile as the economy seems, it is still a representative part of the “normal” up and down of business. Yes, times are tougher now for just about everyone (except for some of those in taxpayer funded positions). But it’s important to remember that this down cycle WILL end. The trick is to survive — and position yourself for the growth part of the business cycle.
To that end, you have to very carefully consider the down-stream ramifications of every decision you make if you are forced to make cuts in budget or personnel. Cutting too deeply into the muscle of your knowledge (staff) base can stall innovation, sales and customer relations. Cutting your marketing budget significantly is virtually guaranteed to give away market-share profits to your competitors.
From a marketing perspective, doing the opposite of what your competitors are probably doing (cutting their advertising and marketing budgets to the bone to maintain operations) is actually likely to improve your brand, your position and your profits on the other side of the tunnel.
Second, the value proposition you must have to win a skittish customer with a strangle-hold on their wallet, whether in the B2C or B2B world, has never been more important. The simplistic equation used by buyers that BENEFIT/COST = VALUE has taken on a new and more powerful meaning.
This means that you have to get creative with your product, your placement, your promotion and your pricing. Buyers — those who are feeling enough pain to want to buy or are strategically smart enough — know that they are in control of the purchase. So your value proposition has to offer a convincing and measurable difference from that of your competitor, or you are toast. That does NOT mean you should focus on cutting price to compete. It means that you should give a buyer every possible reason to give you a try without commoditizing your product or service.
Third, your small businesses must rightly focus on the fundamentals of effective business operations. When times were good — say 18 months ago — it was easy to let some efficiencies slide. No more. Not only must you actually cut costs wherever possible, you should consider strategic and tactical investments in business automation, tools, equipment, staff, and yes, marketing that will help improve your long-term competitiveness.
Make your marketing dollars work harder and smarter. Use social networking to get the word out and/or offer special promotions to current and prospective customers. Measure what works and do it again. While some advertising, particularly in print, is difficult to measure, electronic and direct advertising (tried and true direct mail) is absolutely measurable.
Finally, check any negative attitudes you have at the door. Ignore the pundits and the economists and focus on the game — your customers’ and your prospects’ needs. You are in it to win, aren’t you? Keep in mind that advertising and marketing is an investment, not an expense. As such, some of it will pay off and some will not, but it’s the long-term investor that wins.