In the current economy, every business should be focusing on capturing the lion’s share of the now streamlined consumer market. As customers tighten their purse strings, businesses will have to implement a different than usual approach to their marketing and most importantly a closer watch on marketing expenditure.
Right now, you can’t afford to lose profitable customers, so you need to adopt a targeted approach towards the market that you know will buy your products. Casting a wider net is ideal for brand building and awareness, asserting your place in the market and sending a message to competitors, however, it may not sell your stock and pay you the dividends.
The grandfather of retailing and department stores, John Wanamaker once said “half of advertising is wasted”, today this may seem optimistic. In a downturn, businesses can’t accept this standard and now is the time to squeeze every last drop out of your marketing expenditure.
You can attract the customer mass you need to realise return from your investment by implementing a few key strategies.
It’s got to go!
It’s time to be ruthless and cut any marketing that you know falls purely into the brand building and awareness category and focus your efforts and expenditure on securing customers. Once you’ve identified the wastage in your campaign and are left with the advertising channels you consider successful, look to identify the definite payback or sales from that expenditure before you continue to commit to that cost. You may find even more costs you could cut.
One for you, two for me
To maintain your business success in a downturn you will need to recoup your expenditure costs at a higher ratio than that which you are spending it. If you (hypothetically) currently spend $100 to acquire two customers, you should consider cutting that back to $50 and spending it very strategically. Alternatively you could maintain the $100 spend, but be targeting four customers.
Tried and tested
Focus your advertising and marketing on your most popular, tried and tested products. If you happen to know that a particular product has sold consistently in the past, let your customers know that you still offer the products they like and be more likely to buy rather than focusing on the latest and greatest which may make for news items, but probably won’t translate to a massive increase in sales.
Come one, come all
In a credit crunch the take up rate for top end or luxury items also slows down. Think of ways to make the entry point to your product and brand as accessible as possible. This may mean you offer a more affordable or a more standard line of products, still with the value of your name and brand attached to it. This means a greater customer base will be able to buy your products, which by the time an upturn comes around could be converted into loyal members to add to your existing customer base.
Look for a bargain
With experience sourcing products and materials overseas or locally at the best price you can get – use these skills to get the best price on your marketing and advertising. Be prepared to negotiate or haggle, look out for specials, reduced or stressed rates. With the current instability it may seem difficult to look ahead to the future, but taking out a longer term or repeat booking of advertising can secure you a reduced rate per individual ad.
Maintain your brand
The prospect of a diminished presence in the market does not have to translate to a reduced value in your brand. Maintaining the quality of your products and services that you provide, as well as the relationships you have with existing customers and buyers should be top priority. Capitalise on the marketing and advertising investments you have made previously; be very careful about any new, unproven methods of advertising and marketing. Regularly monitor incoming sales and income before approving any large outgoing expenditure.
Can never be too rich or too thin
Whilst it’s timely to slim down your marketing and business costs during a downturn you may, in actual fact, find that any unnecessary expenditure you recognise now, will not be required again in an upturn. Identifying cost cutting now may well translate to significant savings in the future, and as a business owner that’s more money for you and your business!