In January of 2008, a poll administered
by Fortune Magazine found that 4
out of 5 Americans were concerned that the U.S. would soon
be or already is plunging into an economic recession.
On the surface, this *sounds* like a grave situation. But
no matter what the economy is doing or what the headlines
are saying, the fact still remains: you've got a company to
run and clients to serve. Will the economic downturn affect
your business? That all depends on how successfully you navigate
the change.
Business as usual, for many Americans, means
finding creative ways to meet the needs of our customers.
A recession or pending recession demands that you take some
time to reevaluate whether your current products and services
provide value for your clients, or whether modifications to
your business model, your marketing, or both, need to be made.
Is Your Product or Service Counter Cyclical?
The good news is that when recession hits,
spending doesn't cease; it just filters through different
channels. According to an article titled Four
Mistakes Entrepreneurs Make in a Recession by Scott Shane,
Professor of Entrepreneurial Studies at Case Western Reserve
University, "When customers cut back on their spending,
they often substitute one product for another. For instance,
in a recession, people might cut back the number of steak
dinners that they eat out. But, because they still want to
treat themselves, they increase their purchase of cheaper
foods, like pasta, making pasta a counter cyclical product."
Another example of this is the rise in outsourced
human resource consultant jobs that's been predicted as a
direct result of corporate downsizing. Regardless of economic
conditions, companies still need to manage key aspects of
doing business. In 2008, they're searching for solutions that
will allow them to retain or even improve their level of quality
while reducing overhead costs.
For businesses both large and small, this
clearly this points to a shift in consumer attitudes and perceptions,
which in turn affects spending habits. If you plan to continue
selling to them, it's a smart idea to be concerned about the
wants and needs of your clients. Are they the same as they
were last year? If not, what's changed? What will they be
searching for tomorrow and how can you fill that need?
Economy on the Downturn, Your Marketing on
the Upswing
Another key point covered in Scott
Shane's article: "When unemployment rises, people
start businesses because their opportunity cost of doing so
goes down, further increasing competition. So the need to
have a competitive advantage is even more important in a recession
than in a booming economy."
In marketing, a competitive advantage starts
with knowing your ideal customer intimately. In other words:
now is a great time to analyze or reanalyze your target market.
Large corporations such as Disney, Verizon and many others
constantly tap into the wants and needs of their clientele.
They do this by putting out customer satisfaction surveys.
The findings obtained via these surveys are then used to develop
new products and client solutions or modify existing ones.
How to Create Demand for Your Product
The best way to create demand for what you're
selling is to figure out what the customer wants and then
provide that. For a web based business owner, it's easy and
inexpensive to conduct surveys of your target market and existing
customer base. Websites like http://SurveyMonkey.com
offer multiple membership levels that allow you to enter survey
information right into their forms and then distribute them
to your readers via a link in your blog, newsletter or other
means. You can also elect to hold market focus groups via
websites like the Ryze
Business Network or via online conference rooms such as
those at Voxwire.com.
You can also conduct market surveys and
focus groups the old-fashioned way; by phone, via business
reply mail, or in person. No matter which option you select
for your business, the important thing is to find out what
your customers are searching for and then work toward satisfying
that need.
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