21 Ways to Market for Growth in This Recession
In all recessions there’s a range of responses from companies in the same industry: some thrive and come out with increased market share, while others falter or even go out of business.
The natural inclination of many executives is to cut, cut, cut, with marketing in the “first fired/last hired” position. But companies that take that path may be hurting their short-term, and certainly their long-term, growth. As Henry Ford said, “Stopping advertising to save money is like stopping your watch to save time.”
The current recession devastated a few industries, like hospitality and travel, virtually overnight. Other industries are feeling modest to major effects, and a few are even thriving.
Here are 21 ways that companies can use marketing to not just maintain but grow market share over the next 12–18 months. And when I say marketing, I don’t just mean advertising and promotion, but the full range of marketing considerations including the customer, product and price.
Many of these recommendations can be implemented fairly quickly and inexpensively, providing a competitive advantage to even cash-strapped firms.
1. Get closer to your customers—talk to them and learn how their needs and wants are changing
All successful marketing starts with a profound understanding of the customer, their needs and wants, and what drives them to action. All of that may be changing for your customers now.
Talk to as many customers as possible to understand their thinking and emotions. Don’t do this via a survey; actually talk to them via Zoom or a phone call. You may need a third party to do these interviews for you so that customers feel like they can be completely open. (And, yes, in a few of these conversations your customers might say that they have new business for you, too, but don’t you bring that up. These aren’t disguised sales calls. You’re there to listen.)
2. Adjust your offerings to current needs. Trim unprofitable lines.
Use what you learn from your customers to update your offerings. Maybe they need new products and services, or adjustments to what you’ve been offering.
Toast was quick to pivot their offerings to help restaurants adapt to online ordering, closed dining rooms and contactless delivery—and this feature even helps restaurants get the word out.
This could be a great time to reduce your offerings to the essentials and cut the ones that generate little profit.
Remember: when Steve Jobs returned to Apple in 1997, one of the first things he did was eliminate three-quarters of their products.
3. Market more to current customers. Encourage upsell/cross-sell.
While long-term growth requires growing your customer base, in the short-term selling more to current customers may be the fastest and least expensive way to maintain or grow sales. They already know you and (hopefully) like what you’re doing. You have their trust. Work on new upsell and cross-sell opportunities.
4. Build your reviews from customers
Your customers want you to survive and thrive. Whether a particular customer buys more from you now, they can do you a quick favor for free: write a review.
Reviews on Google, Yelp and industry sites can have a big impact when people are searching for a new vendor. Here’s an example of a little company that’s great at this: Shortly before the social lockdown, I was driving from Boston to Connecticut for a client meeting and my engine light came on. I called ahead and the client arranged for me to drop off my car with his mechanic while we met. The problem was trivial; the mechanic diagnosed and fixed it in just a few minutes. He didn’t charge me but asked that I write an online review instead.
His garage has well over 100 Google reviews with an almost perfect five-star rating. Smart guy.
5. Create a referral program with rewards
Another low-cost way to increase sales is with a referral program. This is going one step beyond requesting reviews to asking for actual introductions to potential customers, with an appropriate reward.
These rewards don’t necessarily have to be large, though. Depending on your industry, a gift card or a meal for the customer and their spouse/guest may suffice.
6. Emphasize value
Even if your customers aren’t feeling the effects of the recession themselves, they’re likely anxious about what’s going on and wondering if they could be impacted soon. They’re probably watching their spending more closely and want to make sure that they’re getting their money’s worth.
So unless yours is a pure, high-end emotional sell (like Gucci handbags), deliver value and communicate the value that you’re providing customers.
If you haven’t used Workflow Builder yet, we obviously encourage you to give it a try. @MasksForDocs was able to automate a portion of its new hire onboarding, which you can read about below. 💁https://t.co/u3aba6fHwO
— Slack (@SlackHQ) May 27, 2020
7. Reduce upfront/adoption costs and offer flexible payment terms
Does your offering have a big upfront onboarding fee or adoption cost? If that’s a barrier to adoption with new customers, look into how you could reduce it or maybe spread it out over time. And often the only thing standing between a deal and no deal is the financing or payment terms.
When I had my SaaS marketing agency, small colleges and private schools were a big part of our clientele. Sometimes all that was needed to close the deal was allowing them to make most of the payments in the next fiscal year, with just a small down payment when the work started. I could get full price by deferring payments by just a few months.
8. Develop subscription models
Some industries have used subscription models for decades. Software has substantially moved from an upfront sale to a subscription model over the past 10 years and other industries that are now following include razor blades, automobiles, food (community supported agriculture) and hardware.
Could you provide your offerings on a subscription basis? Moving from a big CapEx to a small, monthly OpEx may be just the thing to close the deal. Recurring revenue is a wonderful thing—or you can arrange financing on the contract so you still get your money up front.
9. Offer volume discounts, not general discounts
A natural inclination in a tight market is to offer price discounts, but these tend to only offer short-term results and mainly with customers who were already planning to buy. In the long-run discounts may undermine your brand. Offer discounts for something in return: a volume sale.
Sketch offers volume licensing options.
10. Maintain your price relationship to competitors
You don’t have to reduce your prices if your competition isn’t. But if they are cutting theirs, you may need to cut yours to maintain your price relationship to them.
11. Apply a scalpel, not a cleaver, to budgets
If you do need to make cuts, don’t adopt something like a 10% across-the-board cut. Look at each program and see which are most critical and successful, which would be hurt the most from cuts and which are expendable.
Then make precise, well-considered cuts.
12. Strengthen your marketing foundation
If you haven’t already established a strong marketing foundation as I describe in the first phase of my Bullseye Marketing approach, this is the time to do so. Use those customer interviews to produce effective messaging with strong emotional triggers. Get your website updated with strong calls to action.
Messaging on Peloton’s homepage hits on how many of us are feeling isolated right now.
Set up the marketing technology you need to grow your program. (Marketing software is absurdly inexpensive for what it does.) Review your quarterly and annual marketing plans to make sure that you have the people you need to succeed. Your marketing team can include staff, agencies, consultants and inexpensive people overseas hired through platforms like Fiverr and Upwork.
13. Optimize everything
Modern marketing tools, especially the digital ones, provide a ton of data about how they’re performing. Look back over the past year’s data and optimize your campaigns to get the most from them. And then keep on top of what you’re doing now to see if you need to make adjustments for the new business environment.
14. Gain greater share of voice with content and advertising
Right now people have more time than usual to look and engage with your content, so be part of the conversation. Create new blog posts, videos, infographics, etc., that can help your customers manage the current crisis and be successful in the long run.
Another solid example from Toast.
Are your competitors cutting back on their advertising and promotions? Then you could do the same without risking losing your share of the industry’s voice. But why do that? No crisis should be wasted: Keep up your advertising and set yourself up to grab additional market share as the economy recovers.
Advertising sends a strong message that you can be depended on for the long-term, and it can be used to promote all of that new content that you’re producing. Online and negotiated ad rates are low now, so you can grab market share at bargain prices.
“It is well documented that brands that increase advertising during a recession, when competitors are cutting back, can improve market share and return on investment at lower cost than during good economic times.” –John Quelch, Dean of The University of Miami Herbert Business School, Harvard Business Review, 2008.
15. Make sure that your advertising is working
It is shocking how often people see an ad and don’t even know who it was for—the reason being that the advertising is done so poorly. If people should get two things from your ads, it’s what your offering is and what its/your name is.
Spend just a few minutes one morning watching ads by P&G and other consumer marketing masters on The Today Show. Their formula is simple: Show the product, say and show its name, have a few seconds of happy customer charm, show the product again, say and show its name again. Go forth and do likewise, at a minimum.
16. Shift a bit of your advertising budget towards lead-gen
Studies have shown that for long-term growth consumer advertising should be roughly 60/40 brand versus direct response, and B2B advertising should be closer to 50/50. For a few months shift that a bit more toward lead generation direct response ads—not entirely, but enough to keep your cash register ringing. Then fully recommit to your brand marketing as the economy recovers.
17. Send more email
In most markets email marketing continues to be one of the most effective ways to generate new business; McKinsey estimates that it is 40X more effective than social media posts. Emailing your list once or twice a week isn’t too much. And email marketing software costs very little.
HubSpot has aggregated email data from tens of thousands of small- and mid-sized companies using their marketing automation program. They’ve found that since the beginning of March:
- The number of emails being sent is way up
- The open rate is up
- The response rate is down
So email marketing by itself may not be enough (except with current customers) and you may need a multi-touch approach including follow-up calls, sponsored social media posts and remarketing ads.
18. Run remarketing ads
Remarketing ads—those ads that follow you around the web after you’ve visited a website—hyperfocus your advertising on an ideal audience: people who have very recently shown enough interest in you that they’ve visited your website.
And they’re also inexpensive. The cost per 1,000—a common advertising metric—for Google remarketing ads can be less than one-tenth that of sponsored LinkedIn posts and a quarter that of sponsored Facebook posts.
19. Create or strengthen your channel programs
Three-quarters of global commerce is done through channel partners, resellers, distributors, retailers and other third parties. If you’re not taking advantage of these indirect sales, now is as good a time as any to start up a channel program. And if you already have a strong channel program, re-examine every aspect of it to optimize returns from it.
20. Support your community
Many of your neighbors are going through tough times whether or not you, your employees and customers are. What can you do to help them out?
We are honored to share that we are donating 1000 months of free therapy to the frontline medical workers throughout the U.S. who are working tirelessly in response to #COVID19. We thank you for your sacrifice and hard work. #TherapyForAll https://t.co/IzJfAquLjd
— talkspace (@talkspace) March 19, 2020
As another example, some restaurants have raised money from customers and website visitors to pay their staff to create meals for people working in hospitals. Clothing manufacturers have turned to creating masks. At the very least you’ll have helped out people whose current crisis is no fault of their own. You’ll make some new friends who will remember you. And, yes, there may be a PR angle in your good deeds, too.
21. Prepare for long-term changes
The economy isn’t going to recover overnight. Goldman Sachs is estimating that the U.S. economy will decline by 34% this quarter (for comparison, 2008 was down 2.5%), followed by a snapback of 19% growth in Q3. Maybe.
Others predict a slow re-opening. In any case, don’t expect that your business will return to “normal.” Customers are likely to come out of the months of social isolation with changed attitudes that may be permanent. We’ll be in a new reality and you need to be prepared to deal with it.
Now look back over those 21 suggestions and consider how inexpensive—or free—many of them are. You can do this.
The success of our businesses will largely be determined by our ability to let go of old assumptions and habits, many of which have served us well, and create the dynamic conditions that allow us to speak to our customers in ways that are personal and important to them.