After reading a great blog by Valerie Khoo for Enterprise, called The one thing you must not ignore in a downturn, I started thinking more about what Valerie had said.
Many businesses ditch marketing when times are tough, but this is madness, as now is the time to make your business stand out from competitors to compete for the dwindling dollars customers have to spend. Sure, re-evaluate marketing practices to cut out the ones that aren’t as successful and track all marketing activity to make sure it is paying dividends, but don’t chop out marketing altogether.
A few months ago I attended the Recession Proof Marketing seminar and Madame Marketing, Sharon Tieman, explored the concept of cutting out marketing in her presentation. She said there were two ways to go broke in tough times – bad maths or bad marketing.
Tieman said if businesses didn’t cost overheads, products, time or service and marketing, it could spell trouble. Whatever the economical situation, people will still eat out, buy gifts, replace broken and worn-out goods, celebrate and maintain what they have. “The economy is not going to stop. See what is working in your marketing and keep doing it,” Ms Tieman said.
“Bad marketing is not targeted. Use marketing that gives you a return on your investment. Find out what is selling and what is popular,” she said. The key to business success is to sell customers what they want. Do some market research, find out what is selling and then offer that product. “It’s no use being a broke original thinker. Let’s be wealthy copiers!”
“If you are good at marketing, the sales are just so much easier. Our strategy in business is just to outswim the other guys.” Ms Tieman offered tips to help businesses market effectively. First find the hungry crowd, ask why are they buying and who is buying? Focus on gaining and keeping customers and have an offer in all marketing. “You need to give a sexy offer, like 10 per cent off, two for $20 or buy one get one free. Free is one of the sexiest offers you can give,” she said. Think about what your business can give away for free.
This might be an information report for newsletter subscribers, a product donated or discounted by suppliers but perceived to have higher value, or free time – but Ms Tieman warns, “you have to be confident on your ability to sell while you are there, for example demonstrating a product”.
When comparing brand advertising with direct response advertising, Ms Tieman is adamant now is not the time to waste money on branding. “Direct response is better for small business as it makes people want to do something. It’s like television ads versus infomercials, but it’s being remembered versus taking out the credit card and paying,” she said.
Only do marketing that is measurable. “This is not time for experimental advertising; use proven technology,” Ms Tieman said. “You will get five times better response if you target customers you already have by sending them a letter, fax or email, rather than trying to get new customers. Use joint ventures and strategic alliances to market the business further afield.” Talk to people who have had your customers before you or similar customers and find out what worked. Learn how to negotiate and never pay retail again. “Ask ‘is that your best price?’, because businesses will be able to negotiate more in tough times.”
Marketing is often one of the first casualties when businesses start to struggle, but Ms Tieman warns this is not good business practice. “Cut the fat, not the muscle. Marketing is the muscle in your business. Nothing happens until a sale happens and the easiest way to get a sale is through good marketing,” she said. One of the biggest mistakes businesses make in marketing is failure to implement because they are too busy. “What is your time worth? If you earnt $100,000 and worked 40 hours a week, your hourly rate is $52. What is your hourly rate if you earnt $1 million?” she asked.
“Show customers how to make money from what you do. For example to sell a deep fryer, don’t sell it attributes, but that it fried 8kg of chips in one hour. It’s not the best product, best position, person with the most qualifications, nicest office or biggest budget that gets more sales in tough times, it’s the best marketer,” Ms Tieman said. Opportunities come from customer relationships, efficient systems, your mindset, using cost effective marketing and good financial measuring.
For more information about Madame Marketing log on to www.madamemarketing.com.