50 strategies for surviving and thriving in a downturn
- Peter Fisk
- 2011-01-28 11:54:00.0
Downturns are moments for rethinking, for focusing on what makes you special, for getting close to customers, for smart and bold moves, for shaking up the market, for asserting yourself competitively, for reaching out to new customers, for staying positive.
The points of maximum innovation come just before the upturns. Entrepreneurs and companies bold enough to invest whilst others are losing their heads (a Kipling quote in there, somewhere) are the ones who go on to be winners.
So here are 50 strategies for surviving and thriving in a downturn.
Business needs marketing more than ever: to generate the revenues that are it lifeblood, to develop smarter ways of securing it, and to innovate so that you succeed in the next upturn.
1. Don’t panic, don’t abandon your strategy, don’t stop marketing
2. Customers not capital are your most valuable assets
3. People not products are the source of your competitive advantage
4. Focus on retention not acquisition, do more with your best customers
5. Think like a winner, it’s time for thinking and acting smarter
There is no shortage of opportunity, but most people aren’t looking. Tony Fernandez, the US tech entrepreneur, however invested in Air Asia, and sees a vast market that will keep booming.
1. Clarify purpose – ensure your vision and difference are crystal clear
2. Follow the money – focus on best markets, best customers, best products
3. Strengthen your strategy – adjust and respond to the changing market
4. Find new opportunities – emerging markets and failing competitors
5. Reduce your risks – move activities from fixed to variable costs
They call it the Miracle Whip insight. More new businesses and products started in the Great Depression than at any time. Downturns are times for new priorities, and new innovations.
1. Understand customers – do new research to understand changing needs
2. Redefine priorities – explore the customer’s new essentials and aspirations
3. Feel their pain – they feel poorer and lack confidence, and make careful choices
4. Segment for profitability – identify customers of highest profit and highest risk
5. Price patterns – understand the new dynamics of price elasticity
Customers still have money - they still eat and drink, meet and travel, work and talk. If nobody wants a SUV sell them a Hybrid, or move Starbucks from an everyday essential to small indulgence.
1. The end of extreme – Local and caring rather than humour and adventure
2. Value conscious – focus propositions on value, articulating the benefits more clearly
3. Empathise with customers – show you care, help them, good for each other
4. Focus on price points - think backwards to design solutions at key points like 99c and $99
5. Avoid discounting – use tactical promotions and better terms, not lower prices
Nintendo Wii - not just another computer game, but a whole family experience, and saves you time going to the gym too – but you will struggle to get hold of one, intensely popular even in tough times.
1. Do more – help customers practically to achieve more with your solutions
2. Restructure solutions – lower entry point, unbundle or bundle as appropriate
3. Help channels – work with distributors, better terms, easy returns, joint promos
4. New models – franchising not owning outlets, leasing not selling products
5. Stay positive – energise your people, keep smiling, make service your difference
Brands are something to hang onto when everything else changes. They are familiar and trusted. Tesco and Wal-Mart moved from laggards to leaders in downturns, and stayed there.
1. Build trust – provide clarity and reassurance to customers, be the most trusted brand
2. Rearticulate stories – adjust the reasons why people should buy from you
3. Smarter media – focus on most effective communication, shorter and faster
4. Everything sells – use everything to drive sales, from sampling to packvertising
5. Networks work – endorsement and advocacy, word of mouth physical and virtual
The Barbie effect on Disney was remarkable. Manufacturers Mattel never thought they would work with such partners, until tough times forced them to form a successful collaboration.
1. Rebalance portfolio – accelerate key products to markets, mitigate risks, focus effort
2. Get together – form new partnerships and alliances, better solutions, broader reach
3. Bigger impact – get value innovations to market, whilst competitors are distracted
4. Business models – rethink how you work, be ready to acquire failing competitors
5. Antidote – offer people a reason to smile, to feel good whilst all else is gloomy
Marketing drives business results, but as a large discretionary spend it needs to demonstrate through financial metrics why it is essential to retain in tough times.
1. Positive impact – now is the time for metrics and ROI to prove marketing matters
2. Spend smarter – renegotiate deals, change communication mix, eliminate waste
3. Forecast future – rethink the rising stars, recalculate the sources of future profits
4. Loyalty matters – work harder with existing customers, sell more, cost less, stay longer
5. Build communities – target the best groups to work with, and be part of their world
This is moment for leaders to give direction and focus whilst all around them are losing their heads. It’s time for heads up, not heads down leadership.
1. Heads up – the business needs leadership, where to focus, what matters most
2. Be agile – respond to change fast and positively, as others fail, as green shoots emerge
3. Drive action – get the whole organisation focused on customers, retention and selling
4. Bigger picture – don’t get stuck in the trenches, stay integrated and moving forwards
5. Be confident – about marketing, about customers, about opportunities, about the future
Peter Fisk has worked internationally with market leaders including British Airways and Coca Cola, Marks & Spencer and Microsoft, Virgin and Vodafone, O2 and Orange. He was the transforming CEO of the Chartered Institute of Marketing, led the global strategic marketing consulting team of PA Consulting Group, director of Brand Finance, and partner of strategic innovators The Foundation.
He now leads The Genius Works, helping business leaders to see things differently – to develop and implement more inspired strategies for customers, innovation and marketing. For more information visit www.thegeniusworks.com