Companies can survive, even thrive, during a recession

Recently, I heard two series of local radio ads that I found refreshing.
One is for a siding company and another for an HVAC firm. They send a similar message:  “We’re trying to keep our business going until things get better. Call us now for special deals and even better customer service. We want to keep our guys working.”
It’s unfortunate that the economy has required these firms and others to develop such direct messages, but I personally like that directness. These companies are making no secret of the fact that times are tough right now, particularly for folks in their business, but they are intent on surviving it through a blend of optimism, determination and very hard work. And they are reflecting one of the tried-and-true strategies for marketing during a recession: Keep talking, and when things improve, you’ll still be standing while your competitors may have thrown in the towel.
I was fascinated by a list I found the other day of the companies that had actually started or thrived during past recessionary periods. The leaders of these firms saw a market opportunity and capitalized on it – good advice for prospective and existing business owners regardless of the economy’s health.
In 1957, during the Eisenhower recession, Hyatt Corporation launched its first hotel at the Los Angeles International Airport while Burger King, a fledgling start-up at the time, introduced its signature Whopper. Another success story from that same year was the opening of the first International House of Pancakes. In 1958, Jim Henson started creating his Muppet characters and launched an entertainment empire. In 1959, Pronto Markets, a series of convenience stores, first opened. Now the company is known as Trader Joe’s.
LexisNexis started as a government contractor during the 1973 oil crisis. Seven years later, a little-known station called Cable Network News launched during the 1980 downturn, followed one year later by MTV, which added a new brand of entertainment for young people.
Although it was launched in early 2001, Wikipedia really took off following the attacks of Sept. 11, possibly as a result of us cocooning more around our computers. And Hewlett-Packard Development Company was born from a $538 investment in a garage in Palo Alto at the end of the Great Depression.
The lesson here is that survival – even prosperity and growth – is possible. One component of that survival may very well be a more sophisticated marketing approach.
What can you do to turn tough times into times of opportunity?
Research. This is the time when you need more information – not less – about how your customers are responding to the recessionary times. What are they buying? What is the new price point? Are they negotiating more? Customers are more likely to go with tried-and-true products at times like these than they are to try new items or services.
The comfort of the familiar. In uncertain times, we want to be in familiar places with familiar people doing familiar things. So market what you can to enhance the comforts of home and family.
Hold the line. When your competitors are cutting back, you need to maintain your strategy. You can gain more market share without increasing your marketing investment above what you had budgeted originally. We want the assurance of known brands and vendors, and because we’re spending more time watching television, you can likely count on more of us seeing your promotion.
Try to maintain the frequency of your advertising, but reduce the length of spots from 30 seconds to 15 if you must. Substitute radio for television. Augment with direct-mail marketing that makes a greater impact.
Value and reliability. With less money to spend, customers are looking for the best value, even if it includes fewer bells and whistles. Push multipurpose products. Stress reliability, durability, safety and consistently high performance.
Image and brand. Although the temptation may be to drop to lower-priced lines, avoid it. You want to maintain your brand and your image of supplying high-quality goods and services. You’ll want to retain that position when things improve.
Promotions. Of course, we’re all looking for the best deal, but that doesn’t necessarily mean you should lower prices. Instead, offer temporary and special promotions, offer more quantity discounts, and extend credit to some of your best customers.
Face time. Now is the time to spend more time with your customers. Assure them that you will survive these challenging times, that you will not sacrifice quality and that you will not cut corners. Emphasize to your customers that their loyalty to you is not misplaced.
Measure it. Ensure that you have some system for tracking the effectiveness of your marketing efforts. Your tactics must be measurable. If they are not, revisit your marketing strategy.
Deepen the relationship. It’s probably more practical in a downturn to enhance your relationship with existing customers than it is to find new customers. Because they know you, they will turn to you for information, service and the best products. They are less likely to gamble on a source with which they are unfamiliar. So cater to them. Market to them. Ask them what they need and want.
Think ahead. Even when things are going well, think of what you could cut if you had to. Then do it. You may decide to print materials in-house rather than outsource it. Reduce your travel budget by holding virtual meetings. Establish clear goals.
The good news is that once you have followed all of these guidelines, you will have a more efficient and effective marketing operation. Good times or bad, you will have built a system that serves you and your customers well.