But what is the ideal strategy for flourishing when others are navel gazing and hidden behind the sandbags? A great piece of research from the Harvard Business Review sheds some interesting light on this issue.
In short it says that companies who get the balance right between reducing unprofitable operational costs and increasing well targeted marketing actually come out of recession stronger than others.
They call these winners ‘Progressive Companies’. For example, the research highlights Staples who closed down some under performing facilities but increased its workforce by 10% during the 2000 recession, mainly to support new high-end product categories and services. At the same time, the company contained its operating costs and came out of the recession stronger, bigger, and more profitable than it had been in 1999.
So from a marketing point of view what are the things you should be doing to make yourself stronger in the medium to long term. Here’s what I think;
- Understand your customers better. I don’t just mean getting sales people or customer services to talk to them more. Get meaningful research done that uncovers theiremotional needs and the journey they make with you before and after the sale. Be aware that their emotional needs change in a recession.
- Focus relentlessly on doing what’s right for your customers. Similar to the point above but it really is that important.
“Progressive companies stay closely connected to customer needs—a powerful filter through which to make investment decisions.” HBR
- Get in some fresh eyes to take a look at your marketing. External consultants can look dispassionately at your marketing and make suggestions that drive efficiency.Ensure they also focus relentlessly on serving customer needs.
- Measure everything. Relook at what you are doing and make sure you understand what works. Don’t get caught up in vanity metrics (such as likes or views) but understand your customer journey and what actually drives the profitable actions you want.
- Look at how you deliver value. Find ways to increase it without big cost expenditure. For example, unlocking information from within your business and providing this as part of your customers’ journey increases the ‘Positive Value Exchange’ with your prospects and customers.
It’s clearly been shown that Progressive companies who increase their marketing focus balanced by operational savings come out of recessions stronger. So why not get a fresh pair of eyes to take a look at what you do, ask some challenging questions and make sure you are focusing on your customer needs.