How To Market In A Really Bad Economy

Eight ideas to help your small business.

Even if your company is doing well during a down economy, you need to make plans for customers who may start cutting back. They key is to shift your marketing from image-oriented marketing to direct response, measureable advertising. If your business is already feeling the effects of a weakening economy here are some strategies you can use to market in a bad economy.

1. Place your focus on more direct forms of revenues versus “image advertising.” It’s time to show good, measureable results. Coupon redemption programs and the use of promo codes can be very effective. When the economy is down everyone is looking for bargains. With coupons and promo codes you also get to track what’s working and what isn’t.

2. Learn more about your customers needs. Surveys don’t have to cost anything. If you have an email list, you can build a quick survey to send out using Survey Monkey. It’s free and easy. You can also put the survey on your web site and offer something free for people to take the survey. Since you may not be able to advertise everything during a bad economy, it’s smart to know where to put your money.

3. Call in favors from your vendors. You need to get the biggest bang for your buck. I’m not suggesting hitting up your vendors for such large discounts that it places an undue strain on them. However, get what you can while keeping your relationship good and making sure they stay in business to serve you throughout the downturn.

4. Not all customers are created equal. See who has purchased the most from you and make sure you stay close to them. As your best customers, they should be entitled to any perks you can afford.

5. Stress ROI. All of your campaigns need to convey how your customer will profit from your product. And you need to be as certain as possible that your advertising campaign will pay for itself. When you start a business you obviously need to watch your pennies. However, don’t abandon this practice as you grow your business.

6. Test. Test. Test. Segment your list and try different subject lines, headlines and sub heads. Try different offers. The key is to find the one combination that hits the sweet spot and use that one. This point brings us back to the importance of measuring your results. With limited funds when starting a business you need to know which message gets you the best results.

7. Try to “convert” everyone that comes to your web site. By convert I mean capture their name, company, email, and phone number. Get this valuable marketing information by offering your visitors valuable content. Reports and videos are great things to use. Think about any content and information that would help your customer or prospect succeed – especially in a bad economy.

8. It’s time for family values. When hard times hit, people tend to go back to the nest. Try to position your product in warm, fun, family-oriented scenes. Even if your product doesn’t quite fit that image or is more business oriented, every product will affect someone. The image could even be a coming together of office workers around your product. “Paint the picture” how your product makes a warm, positive impact on someone or something.

While no small business likes bad economic times it can be an opportunity to sustain revenue, build brand awareness and brand loyalty, and strengthen ties with your customers.

To Chase Or Not To Chase – What Business Am I In?

All those tempting opportunities

There’s always a balance when starting a business between keeping a razor sharp focus, and being open to new opportunities when they come your way. You can’t chase everything that comes down the path when you start a business.

When I first started my business in 1986 I was a manufacturer’s rep selling computer memory boards to businesses. One day I called on a prospect and they told me, “We don’t need any memory boards, but I could use a good programmer.” I few days earlier I had run into a colleague of mine, who was a programmer, and had just quit his job at the same company I had worked at, to start his own programming business. I called him up and in about 10 minutes we worked out the details. I presented him to the prospect and they hired him that day. From that one opportunity my training and consulting business grew.

Every now and then when you start a business an opportunity will present itself that’s not quite in the core competency of your current business. It may be in the same playing field but you would really have to find new resources or set up different procedures to handle this new opportunity. It’s always tempting to go for it because it’s either it’s a good-sized deal or you really need the business. (Or your entrepreneur gene is out of control.)

If you have salespeople, and they bring you the deal, it complicates the decision. If you decide not to pursue the deal, and your sales rep is working on commission, they may see it as taking food off their table. It’s another small business dilemma.
Ultimately, you have to make the decision if going after this business is in the best long-term interest of your company, regardless of whose feelings you may hurt.

Here are four things to consider when you are making this decision:
1. Are there any other current customers that could use the same product or service?
2. Will it cost you the same or even less to deliver this special deal, than you typically spend?
3. Are the profits from the deal worth the time spent going after it and opportunity lost from your current business?
4. Can you keep selling the product (or an upgrade to that product) or service to the same customer after the initial sale?

If you answered “yes” to all the above, then I don’t think there’s anything wrong with some flexibility and going to for the deal; especially if you really need the business. Just be clear with yourself and your employees why you are going for the deal. Go through the four points I list above with them as well.

Also, think about the downside. What if you invest the time and resources and then don’t get the deal? What have you lost? Will it really set you back? Since every situation and deal is different, I cannot tell you what to do. I just want you to be clear, and brutally honest, on why you are chasing the deal.

How to Turn Adversity into Opportunity

A Lesson From Google

Every self-help book has something similar to the following: “Inside every disaster there is an opportunity hiding.” I was always skeptical of this attitude, until a little adversity came my way.

I used Google to host a web site for me. As I mention in the eBook, I like Google web sites when you start a business because they are easy to put together, give several different template options, and most importantly, they generate a site map for you and index your site very easily. This gives you a better chance being found by their search engine.

There are two downsides, however, to using these sites:
1. Flexibility. For the most part you have to design within their template constraints. This can make your site look cookie-cutter.
2. You have to play by their rules. That’s where I got into trouble.
One morning I went to my Google site and a yellow banner came across the top that told me, “This site has been suspended for violation of our Terms of Service.” Yikes!

Google did not tell me what I had done wrong, only that I had violated the terms. They did give me a link to dispute their decision and a link to the Terms of Service for me to figure out the violation myself. After reading the terms, I guessed that the site was suspended because of a parity video I had created using my wife. It was a take-off on the Charles Schwab commercials. It had that “cartooner” effect the Schwab commercials had been using. So, I took the video off the site and wrote Google asking if we were friends now and if I could have my site back. Of course, there was no immediate response.

Panic setting in. This was my main site for my sales copywriting business. If people could not get to it how would I get business? If people saw that threatening banner at the top what kind of credibility would I have? How could people trust me with their sites? Is Google putting me out of business?

Breathe. The truth of the matter is that I had wanted to create my own pages for my business and host them with another provider but I had been putting it off. I had already created one site to give away this eBook on starting a business from scratch, and I thought it would be nice to have my sales copywriting pages have the same look and feel. But everything else took priority. Now it was time to buckle up and the pages done. I had no choice.
Take action. So, I jumped in and gave it priority. Within one day I had converted most of what people visiting my site would need to see if they wanted to hire me and I really liked the way it came out. I think it makes a much better impression and I’m already having better results. Taking action is the key to opening the opportunity door. Contrary to “secret” believers, you cannot just wish it to happen. You have to do something about your situation and put all your mental energies into it.

The Lessons. You usually don’t knowingly walk into adversity. Somehow you just end up there. But when it strikes, you have a choice to make: Wait for things to get better or take action yourself and try to turn the adversity into an opportunity. There a lot of lessons for entrepreneurs to be learned from what happened to me and how you can apply them to your business. Here are a few:
1. Don’t ever forget – Nothing in business is ever really free. If it was, it would be called a charity and not a business. Google gives away a lot of software for free because they tie it back to the advertising revenue model. And they do it very well. Google gives good, quality software at no cost. You can do a lot without spending anything. But you are playing in their sand box and have to play by their rules.
2. Make sure you have a backup plan for areas that are critical to your business. Don’t just think about it. Get them ready to go at a “Violations” moment’s notice. Your list should be prioritized and have the items that will shut you down listed at the top.
3. Don’t be lazy by thinking you will get it done but, “it’s such a hassle and I have important things I have to take care of.” Set aside a half hour a day and go through your list of critical areas to your business. Knock off a piece each day until you feel comfortable. (Don’t forget about data backups. Most people do forget to back up their data until it’s tragically too late. Thumb drives are ridiculously inexpensive these days.)
4. There really can be opportunity in adversity. You just need to stay calm, make a plan and take action. I’m a true believer now.

Google finally did write back to me. Their team said I could not use that particular site but I was welcome to create a new Google Site. It turns out I had a “link referral” on my site. Google does not allow those types of links on their sites. When you start a business from scratch, you need to know the ground rules for every part of your business.

$tarting Over

I saw a segment on this evening’s national news entitled, $tarting Over.
It was about people who were forced to start their own business after being laid off. The segment featured a woman who, after returning from maternity leave, was informed that her division was closing and everyone was getting laid off.

While the manner in which she was going about starting a business was not exactly the way I suggest in, How To Start A Business From Scratch…Without Having Any, it did point out what many people have overlooked about starting a business.

A lot of people, who are concerned about starting a business in an economic downturn because the business climate is bad or we are in a recession, fail to realize they may not have any choice. And, unfortunately, many do not prepare themselves for a day where they need to rely on their own skills to bring home the bacon.

Even if you think you have a sound and secure job, take the steps now to prepare yourself. Your house may never burn down or get hit by a tornado but you need home insurance. Consider this “Career Insurance.” At a minimum you will learn a lot about yourself, business and maybe decide to take the plunge regardless. Take the time now to do your homework so you will not be under pressure to rush through the process if you have to.

At least start by asking yourself what you are passionate about.
Close your eyes and ask yourself this question: If money were not an issue, and I could do any job I wanted, but I had to work, what would I do? There is a good chance this is what you are passionate about. When you are passionate about something, time and work do not matter. The price you pay in practicing and honing your skill is a labor of love, and time flies by.

You may say, “I am not passionate about anything.” I don’t buy it. You just might not want to admit out loud or to yourself because it just sounds like a hobby or an interest you have. That’s your source for your best ideas. When you have a strong interest in an area, you know it. You read the magazines and journals dedicated to that interest, and you could talk for hours about it. That’s passion. It will provide energy and motivation for your business.

I am not saying you have to be passionate to start a business. But it helps. You are going to spend a lot of your waking (and dreaming) hours in your business. It will much more enjoyable if those hours are spent doing something you like. And if you’re good at what you are passionate about, you are way ahead of the game.

There are a lot of other factors to consider when starting a business from scratch, but your passion will guide you through the tough choices.

At the conclusion of the TV news piece I was glad to see it was pointed out that Microsoft, Johnson and Johnson, Compaq, HP, and other successful companies were started during a recession. And they all started with one person’s passion.

You have a business and the recession is upon you. Oh, crap.

Business has been good, so you’ve hired a few more people, expanded into larger facilities and even started giving perks to the employees. All of a sudden things start to slow down. You watch the news but don’t see a mention of anything slowing down. You start to panic – what am I doing wrong? Everything was working great. I just expanded!

Don’t ever forget you are a small business. Small businesses play in different sand boxes than big businesses. (And they very rarely play well together.) As the economy starts to slow big business notices it very slightly, and you catch a cold. As the economy goes into a major downturn, big business catches the cold and you have pneumonia. Bad news in the economy will always hit small businesses first. The irony is that the majority of the people in the world are employed by small businesses.

I always stress as a small business you need to remain flexible, not only when starting a business, but even as your business grows. It’s very tempting and ego-gratifying to expand. But, you are better off being a little late to get in on a growth spurt than be saddled with payroll, leases, etc. that continue to be due each month, even when there are no sales. Your vendors don’t really care about your sales. They care about theirs.

As of this writing, the U.S. and global economy is very, very slow. It doesn’t matter if you call it a recession or not. You aren’t getting the sales you need. Before I give you a few tips on how to deal with it let me make one point I learned a long time ago from a really smart economist: The economy goes in cycles. It always has and probably always will. It has been as consistent as the tides going in and out, since we began keeping track of the economy. So, regardless of how bad it is right now, it will change. It always has and it always will. Your goal is to survive until it does.

Tips:

Cut early and cut deep – Let’s start with the most difficult issue first. As much as you love having your staff you cannot let your generosity put you out of business. This doesn’t help your family or theirs. Maybe you can hire them back when things get better. Adjust your staff level as if the downturn were to last for at least six months. Listen to me when I tell you this – I learned this lesson the hard way.

Review ALL your expenses – Make sure what you are spending is a necessity and not a nice-to-have. Free soda in the break room is a nice-to-have.

Stick with marketing programs that work – and ditch the other ones. I do agree that you need to keep a direct response program in place. But, go back and find one or two that delivered the best results and stick with those. Also, go to those vendors whose marketing programs you do use and explain what you’re doing. See if they’ll work with you on price, terms, added-value, etc. Chances are they are slow too and will be willing to work with you to keep your business.

Offer promotions – It’s time to give a little to get new customers and keep the customers you have. If you can give something two-for-one or offer a, sign up for one year and get one year free, do it. If you have extras that really don’t cost you anything, now’s the time to bundle them into your product.

Keep your employees informed – You aren’t the only watching the news. Your employees watch it and worry just as much as you. They probably worry more because they have no say whether you keep them or not; whether they get a raise or not. Their future and the future of their families can rest in your hands. Be as honest and as forthcoming as you can without scaring the pants off them. They will appreciate it, they will be more productive and it’s the right thing to do.

I ran into a friend of mine recently whose home remodeling business went from $100 million a year in sales to $30 million, in 18 months. You might say that’s still a lot of money. It is, unless your expenses are $35 million. He said something interesting to me. He said, “I can’t downsize quick enough.” He had invested in large facilities and equipment that came with contractual leases. He still needed to make the monthly payments on those leases regardless of his sales volume. He’s learning the flexibility lesson the hard way. Don’t you.

Interview on the Jackie Rogers Show

Interview

Five tips you can use to improve your marketing message

I am often asked how to structure and position marketing material to get people to buy. One way: People need to see what’s in the deal for them.
Nobody is going to buy because:
YOU have been in business for 30 years.
YOU have won, Best Dealer of the Year five years in a row.
YOU have more satisfied customers than anyone (so says YOU).

Nobody cares how what you did for somebody else helped you. People want to know how what you offer is going to help them get what they want. Period.

Your prospects need to know you understand them. That you understand their needs and wants well enough that you don’t even have to talk about the features of your product or service. But rather, what that product or service will do for them.

It all starts with a conversation or a marketing message. Here five tips you can use to help turn a prospect into a customer. They work because you speak their internal language and talk to them on an individual level.

Benefits not Features – People don’t want to hear you have a new, innovative tire with inner protection. They want to hear that your new tires have an inner ring of protection that if it get a flat, keeps the car (and the kids in car) moving straight on the street, rather than flying into a ditch or head on into another car.

Talk personally – If possible try to use the person’s first name in your message. People love the sound of their name and will pay more attention to your message if you “talk” to them using their name. And make the tone of your message conversational; like you were talking to a friend of 20 years.

Focus on one thing – You probably have more than one thing to sell. But don’t try to sell everything in one letter just to save money. You may miss some sales because what you are selling in that message doesn’t apply to that person at that particular time. However, your message is targeted and if you get the prospect’s interest, they will think you are talking directly to them. It allows them to focus.

Testimonials – Self praise is not recommendation. While people do care about what’s in it for them, most also do not want to be pioneers. Try to get a satisfied customer (or more) to give you a written testimonial. They are worth their weight in gold – to you.

Be a problem solver – Put yourself in the customer’s shoes and think about how much better you would feel after using your product. They bought it because it solved a need or a want for them. Think about the end result your product or service will achieve for your customer.

These tips are small but powerful. I hope by implementing them in your message, they bring you much success.

All the best,


Louie Bernstein