“How do you find the time to manage all of this social media stuff?” That’s one of the most common questions I’m asked whenever I present. And sometimes, I get the sense that people are hoping that it’s so complicated and time-consuming that they’ll have a great excuse NOT to do it. Not to learn [...]
The economy is shrinking. So how much should your marketing budget shrink?
There's no doubt that some sectors of the economy are slowing and when things get tough, marketing is one of the first budgets under the knife. Many company directors and business owners see money spent on advertising, public relations, general and direct marketing as an expense rather than an investment. In turn, slashing the marketing budget can be seen as a quick and simple cost-saver.
Adopt a more direct approach to marketing
For smart companies, a ''recession'' offers the opportunity to out-fox your competition with cunning, cost-effective marketing strategies. This doesn''t mean an increase or decrease in your marketing budgets, but rather just adopting a more direct approach.
As a business owner, the need to see a tangible return on investment is very real, particularly in tough times. And the good news is that by restructuring your marketing plan to allow for a more one-to-one model, you can monitor exact results and return on investment.
Tip: Instead of taking a blanket approach (getting as many brochures out as possible), think about your ideal customer profile. Once you have a clear picture of who your ideal customer is, you can use this profile to target specific demographics. By narrowing your target market, you will get a much higher response and a better return on your marketing dollar.
Build and strengthen key customer relationships
Retention and loyalty programs, also likely to be on the chopping block, are more important than ever in difficult times. When the economy looks shaky, the value of each of your customers increases, and cutting retention programs could spell suicide.
Keeping in contact with your customers and maintaining a positive image of your brand via a newsletter or other communications tools is essential to maintain customer loyalty. This is particularly important given that many of your customers may be looking at cost cutting and your product or service could be on their agenda. That's why it's important to build and strengthen relationships with your key clients and customers. By adding value you protect yourself from being undercut by competitors.
Tip: Look at a program of communicating and adding value to your customers over the next three to six months. You could fax or email your client an interesting article, send a handwritten thank you card with flowers or a gift voucher at the end of a project or give them a gift on their birthday.
Make sure the whole team understands the importance of marketing
Internal marketing also increases in importance during an economic slowdown so it's vital this is understood right across the board by your staff and your suppliers.
Tip: Involve your staff in customer nurturing strategies by getting their ideas and input. Often your team will come up with the best ideas for strengthening customer relations, and if they have ownership of the ideas, implementation will be easier.
Get smarter about marketing
The answer is not to necessarily cut your budget, just get smarter with it. You need to create channels that show a direct link between your marketing expenditure and your bottom line, as well as increasing the return on investment for every dollar spent.
The businesses that will survive (and thrive) in the economic slowdown will be those that channel their marketing dollar into more direct, accountable activities.
Three key strategies for marketing your way through an economic slowdown
- Don't panic. Knee-jerk reactions to fiscal squeeze can reflect badly on your business.
- Maintain relationships. Communication programs with your existing customers (newsletters, e-marketing, websites) are critically important. You must maintain loyalty and strengthen relationships with your existing customer base.
- Be direct. Adopt a more focused approach and invest in marketing activities that are measurable and scalable. That way you can monitor results and adjust your program if necessary.
This article was written in 2006.
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NEW: Social Media for Small Business Webinar Series
Practical ways to use social media to grow your business
Online Webinars - Starting 28 May 2013
NEW webinar series: designed to dispel the myths about social media and arm small business owners with skills and know-how to make social media a powerful force for business development and bottom line results.
Experts will present practical ways to use social media to:
- Build brand awareness for your organisation
- Network and make connections all over the world
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- Grow you reach with suppliers, staff, resources, alliances, sponsors