The economy is struggling, and small businesses have been hit the hardest. However, amid all the downsizing and leveling of growth there are lessons to be learned, ones which are forgotten in better economic times.
Money Means Frills – As a business owner, its easy to be seduced by things you think you need, especially when those in the same industry think they need them as well. I’m talking about spending money on premium designs and logos, fat stacks of high-gloss business cards, cutting edge ad space, and automated phone systems. As good as these made me feel, I honestly don’t think any of them really helped me make money. Sure they may have moved some more product, but too often they were tacked on expenses that didn’t do that much good. These upgrades are nice, but in times like these such investments should do two things: get customers to choose you over others, and keep them once they’ve done that. If it doesn’t do that, its probably a waste.
Debt and Focus – Reduced cash streams gets you focused on what matters. Less money means your unique sales pitch has to be absolutely top notch, since you can’t hide behind gimmicky layouts and flashy websites (see above). You have to rely on value alone. Your customers need to remember and talk about your products. In the end, low-budget marketing campaigns based on serious commitment to an excellent service is fun, authentic, and memorable, not to mention affordable.
Character. Innovation. Success. “Wax on. Wax off.” Like the Karate Kid, getting back to the fundamentals of business discipline will only generate revenue, and perhaps uncover possibilities you hadn’t seen before. Remember the scene from Gone With the Wind where Scarlet O’Hara makes a dress out of curtains so she can get $300. Desperate times lead to desperate measures, but ‘desperate measures’ often means efficient, bottom-line success.
For many of us, the idea of roughing it means reducing cell phone minutes. Here are a few guidelines for what effective reduced-cost strategizing should mean.
- Know who your customer, their needs, and why they would choose you. Answers to these three questions will help streamline your marketing decisions. If they’re hard to answer, think about other companies you go to as a customer. If you like Starbucks, describe yourself, what you look for in coffee, and why you go to Starbucks. Do the same thing for your favorite PC, insurance company, department store. Think about how your needs are being met, and do the same with your own business. And never be afraid to ask your customers!
- Tracking Expenses – Everything. And written down. Enacting a strategy where every coffee and ink cartridge gets recorded reduces these nearly invisible bleeds, and may even expose places where a significant amount of money could be saved. A little self-accounting could go a long, long way.
- Referral System – Referrals happen. They’re also great for business. Why not structure a simple referral rewards program that incentivizes loyal customers to spread word about your business and gives them a selling sheet to work from. Not only will your customers hear exactly what sets your company apart, your ideal customer, your campaigns, and how you treat new customers (reinforcing their loyalty to the business) but also generate new income by effectively drawing in new customers. All this for typing up a simple sheet!
- Embrace the Internet – Social media tools like blogs, LinkedIn, and Twitter can be thought of as “digital billboards.” Gone are the days of these as gimmicky, new-fangled arenas. They’ve been proven to increase communication with your customer base. Not only that, but your company appears up to date on the latest technological trends, and all this for free. Nowadays when people ask if you have a website, you don’t want to be the person who says no.
Companies who economize know the importance of close relationships. They know that loyalty and honesty are what matter most, and that will thrive in any economy.