Opportunity In A Troubled Economy
August 28, 2008
(3 votes, average: 4.67 out of 5)
Loading ...My clients seem worried these days. New revenue is hard to come by and lots of companies are rushing to cut staff and other costs to make up for unhappy balance sheets. While that may be a natural knee-jerk reaction, hold the temptation until you have explored the not so obvious new territories which might just save your company and the jobs of your employees.
A call center client contacted me last month regarding ways that he could cut his telecommunications and other costs as a result of lost business and lowered revenues. He was worried. Wondering if he’d be able to hold out until the economy turns around. I offered my usual advice about running network tests to determine if he was paying for too much bandwidth, make sure that he wasn’t overpaying on his phone bills, and offering advice on outsourcing of non-critical processes. All of which he appreciated and could save him a tidy bundle.
But then I hit him where it hurts. I advised him that cutting once may produce a temporary fix and keep his accountant from jumping off a cliff, but the loss of employees, bandwidth, and the associated knowledge and good will of his employees might leave him with the inability to generate new revenue and clients just when he needs them most.
My advice was that he needed to reevaluate his business and realize that his customers are hurting too. When times are tight, people pull back. But they are still out there and they still need products and services.
The key is to offer services which help your customers save money compared to what they are currently shelling out. If you offer consulting, be the expert that helps customers trim their expenses and make sure that they have the correct contracts and vendors. If you offer services, offer packages which provide stripped down services at the lowest possible rate and then work to slowly upgrade services as your client’s financial condition improves. If you offer products, make sure that they are not only competitively priced, but that you position them in a way that features the cost savings and benefits compared to your competitors.
When times are tough, people don’t run to the specialty stores for basic items, they go to discount retailers like WalMart. And while you may have spent years building your reputation as a quality-over-price company, now is the time to at least offer a promotion which goes against your normal (and no longer working ) marketing.
Now is NOT the time to cut your sales staff and marketing. It IS the time to reposition your product and services with a bold new message or promotion and push it out via every means that you have available. Reach out to current clients with offers designed to keep them happy. Offer rewards to clients who send you new business. Create temporary campaigns and products designed to hook new customers with lowest possible rates. Hammer your message into the minds and talking points of every employee of your business. If every last one of your customers and potential customers doesn’t know that you care about saving them money, you haven’t worked hard enough.
Through all of this, just be careful not to look desperate. You don’t want your customers to fear that you are going out of business. Be aggressive but continue to promote your great customer service, how strong your company is, your awards, etc.
Cutting your own costs may make you happy for a quarter or two, but boldly and loudly cutting your customers costs could gain you more business. Even if the margins aren’t great, you will have a larger customer base to reach out to with new and upgraded products as the economy rebounds.
Bad economies don’t last forever. If you think of this as a time of opportunity - A time to grow your customer base - A time to reevaluate your message and the way you do business . . . You might just come out farther ahead than if there had been no economic downturn at all.
-iTodd
We’d love to hear your stories about how you have turned the economy to your advantage
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This is a great article.
This is so true. There is almost always a way to spin unfortunate circumstances to your advantage if you have the resources and will to do it.