Worst Recession Blunders Ever!

Recession. Recession. Recession. We’re bombarded with this word every day. Every change in the economy creates casualties and winners. How’s it affecting you and your business? Downturns can be an opportunity to grow your business – or at least ride the waves until it passes. But some businesses seem to press the self-destruct button and make horrendous mistakes.

Make sure you avoid these blunders...

Forgetting the customer is King (Kong)
There are some consumers – and businesses – who are less affected by a recession and some who actually benefit from the downturn (think insolvency practitioners, forensic accountants, discount supermarkets). During a recession, people change their buying behaviour – we’re more careful where and when we spend our hard earned pennies. As a result, customers have more power than ever.

For survival, businesses need to be even more focused on understanding their customers’ needs and wants. Why should they buy from you? What do you do differently? What can you offer them that others can’t (or won’t)?

Slashing investment in marketing
You may be tempted to stop marketing over the coming months. One word – DON’T (or is that two?) Of course, when cash is tight you need to make sure you’re getting the most out of every cent you spend. You just need to be more selective about what opportunities to choose. According to the Retail Think Tank, research has shown that increasing your marketing during a recession puts you in a much stronger position after it has passed. “When comparing the figures of those who continue to invest with those who haven’t, it’s the businesses who continue to spend that gain market share from their competitors during tough periods and position themselves to prosper afterwards”.

If you were building your own house, they always say that using a good architect will save you money in the long run. It’s the same with marketing – get your local printing.com team involved from an early stage. They’ll be able to keep you in touch with special offers and suggest ideas you may not have considered. If you do choose to stop marketing, you’d better hope that all of your competitors do the same.

Neglecting existing customers
It’s much easier to sell to people who already know you. Don’t forget them. They know you, they know what you do and you know what they buy from you. It costs less to market to existing customers (no expensive mailing lists to buy) and there’s usually a higher conversion rate.
People hate being let down and customers making purchasing decisions in a downturn are more likely to choose a business they know they can trust to deliver.

Customers are more likely to buy from businesses who are still actively engaging with them. So stay in contact with them, to reassure that you’re here for the long haul. By keeping in touch, you’ll be the first to know if they’ve anything coming up in the near future. And do some digging. What else do they buy, that they’re not buying from you? How can you increase your “share of their wallet”? Do they know about other products or services you offer? Can you switch them onto a more profitable product by offering them a complimentary upgrade for their first time?

Losing the “share of voice” game
Have you noticed fewer leaflets dropping through your door? Some of your competitors will be forced to reduce their marketing as times get harder. This is great news for you. If your competitors reduce their marketing then there’s less ‘noise’ and ‘clutter’ to compete with, making your marketing communications have a louder, clearer “share of voice”. If your competitors have gone quiet on their customers, that may be a sign they’re in trouble. Fill this gap with an offer which will persuade cost-conscious consumers or businesses to try you.

Ignoring pricing
Just about every major retailer has been running “20% off” sales in the past few months. We’ll be seeing more of this in the future as desperation sets in. Some will be a last “roll of the dice” to clear old stock – and at unsustainable prices. In a recession, people are far more responsive to pricing rather than “promotions”, compared to boom times. You may notice that companies running “free gift” promotions last year are now more likely to be running “money off” discounts instead. A cold hard discount off the price will be more powerful than “free flights” or “free teddy” when the purse strings are getting tighter.