In 2008, I spoke with two groups of business leaders that I coach on the topic, “What should we be doing now to weather the down economy?” Seven ideas received broad support:
- Stay in touch with your center and manage your outlook.
- Get busy with personal, executive-to-executive selling.
- Cash is king. Watch it closely.
- Conserve cash: make sure every dollar out is going to come back–soon–in sales or profits.
- Cut your marginal players now
- Hire slowly or leave openings unfilled.
Plenty of talent is coming onto the market. - If an outlay can wait, let it wait.
- Acquire cash-strapped competitors.
You can acquire talent, inventory, customers, etc. at distress prices if you are patient and prepared. - Cover your fixed costs without devaluing your brand by “white labeling” your product or services at lower prices, perhaps with fewer features or less support.
- Do the math for your prospects to make the business case. If your product will save cash or improve ROI, lay out the exact numbers for their current situation.
A longer list was compiled by one of my colleagues with his groups (Click to see pdf).
Hi Tony: I liked this issue of your newsletter very much. I agree with the white-labeling recommendation, and have implemented that with success here at Basis. Basically, we looked closely at key aspects of our process and figured out how we could best deliver them in “bite-sized”, affordable chunks. Not only has it had a great response, but it has opened up a whole new way of selling for us. In a way, this economy has a silver lining when we business owners get creative with our service delivery! If you are curious, we featured this approach on the front page of our web site: http://www.basisbranding.com.
Often in tough times one of the first areas cut is marketing. While now may not seem to be a practical time to launch a new campaign,
consider carefully how much you cut back.
“sales and profits can be maintained and increased in recession years and [in the years] immediately following by those who are willing to maintain an aggressive marketing posture, while others adopt the philosophy of cutting back on promotional efforts when sales appear to be harder to get.”
More at Go-To-Market Strategies
http://tiny.cc/0v6xC
Boyd Lutz
“Advertising in a bad economy makes good business sense. American Business Press analyzed 143 companies during the 1974-1975 downturn in our economy. The study found that companies that advertised during the recession had the highest growth in sales and net income during the two years of the study and the two years following the recession. The study also proved that companies that cut advertising had the lowest sales and least net income increases during the same periods.
McGraw-Hill researchers also found similar results when they studied companies’ advertising during the 1981-1982 recession. They found that companies that cut advertising increased their sales by only 19% following the recession, while companies that continued to advertise during the recession experienced a 275% increase in their sales. So a short-sighted view of advertising in a down economy may be an even bigger risk.”
Source: http://www.kskinc.com/emails/09152008/09152008.html
Tony,
Thank you so much for this list! A lot of what we’re already doing, and I love the idea of white labeling. We’ve been considering doing just that and this affirms our thinking.
Gini