Never mind the loud drumming of stakeholders who want you to believe that everything is fine – businesses are facing tough times. They are consolidating, laying people off en masse, and some are just quitting altogether. So while most businesses simply toe the line and follow the mainstream trends of shrinking and shying away, what can enterprises do to survive or perhaps even thrive?
The contrarian wins
The most successful businesses and people are necessarily contrarian, at least until they have outgrown their competition. You cannot do what everyone else does and be a leader or a winner. There are countless examples from ancient history to the present, but in recent times this has been typified by companies such as Apple, Dell, Facebook and Amazon.
These companies went against the tide of normalcy and created products that defied the imagination. Apple revolutionized the publishing market and then went on to create phenomenal successes in laptops (remember the iBook?) and the iPhone. Amazon revolutionized the shopping experience and eradicated or drastically shrank many once-great retail businesses. Dell changed the retail and distribution paradigm of computers, and empowered customers by removing the middlemen and distribution channels. And Facebook? Well, it changed publishing and human interaction, for better or for worse.
The marketing economy consolidates
Marketing budgets are shrinking for some companies, invariably resulting in top advertising agencies like Ogilvy and Publicis consolidating and streamlining into more manageable units. This is not a bad thing, as “big” is certainly not better. The new paradigm of business and leadership success is lean and agile. And for successful startups and emerging companies, add “bootstrap” to the formula of “lean and agile.”
In bad times, the landscape may be brutal, but it offers tremendous opportunities for businesses.
But beyond bootstrapping and keeping a lean and agile business profile, you need to stand out against your competition. Branding and marketing are strategic means to keeping your head afloat in an ocean of noise created by countless brands vying for attention. Leading analyst firm Gartner’s survey showed that a majority of CMOs (chief marketing officers) will spend MORE on marketing, roughly 12% of company revenue.
In bad times, some marketers spend less or stop spending altogether. Their logic might be that since sales revenue is down, they must “cut corners,” and marketing seems like the logical place to cut. While accountants may not understand the importance of marketing and its relation to brand-building, consumer mindshare, and beating the competition, there is no excuse for marketers to think so.
Your Greatest Opportunity
In bad times, the landscape may be brutal, but it offers tremendous opportunities for businesses. Why?
- Your competition is shying away.
Your competition may well be spending less and thinking about cutting corners in marketing, thereby reducing their mindshare and media footprint, and allow you to seize the opportunity to attract new customers, and to enhance your brand and mindshare while they hide in the caves. Imagine what happens when your marketing campaigns are prominently seen across online media and offline media (TV, radio and print) on a sustained basis, while your competitors fade away. Who would your prospective customers remember?
- More creative opportunities to beat your competition.
There will be more creative opportunities where agencies, media owners and production houses will launch synergistic campaigns that were not prevalent in more exuberant times. For example, media owners may launch hybrid products that combine broadcast, online and event programs for a fraction of the cost, allowing you to reach a lot more people than if you were to spend in single channels in better times. While some mainstream media are still charging high advertising rates, they are facing tremendous pressure from leaner and more progressive online media, with the result being closures, mergers and layoffs. And online media has another advantage – their results are more easily measurable by analytics, especially when their media is not behind a paywall, making it far easier for marketers to track coverage and campaign results.
- More partnership options.
In bad times, you will have more options for partnerships, where agencies and media owners will be hungrier for business, and can spend more quality time with you and on you. This is especially important for growing brands, or for brands that may not command million-dollar budgets that large agencies and media owners go after. For brands that have sub-million marketing budgets, you have more choices to work with quality agencies and media owners who will go the extra mile for you, offer real field experience (rather than sending greenhorns to do your work), and treasure your relationship.
Spending on your own media
The Gartner study also shows that marketers are spending a significant amount of their increased marketing budget on websites.
And why not? Websites are “owned media,” which is different from “earned media” (such as media coverage) or “paid media” (such as advertising). With a website that has a blog, a business becomes its own content publisher, and can use it to share thoughts and opinions with its customers and stakeholders.
Another major benefit is that websites increase a business’s search engine visibility, since social media platforms such as Facebook are “invisible” to search engines such as Google, especially since not all content is publicly visible. Plus, social media platform content may be owned by you legally, but you cannot tweak the platform for search engine visibility (SEO or search engine optimization) like you can with your own website.
As an entrepreneur and mentor since 1991 (since 1975 if you consider my solo business of selling my own magic tricks and brine shrimp to junior school kids), I have seen businesses come and go.
In my experience, one common denominator of failure is marketing budgets. When businesses shrink their marketing expenditure in bad times, their visibility to the market becomes abysmal, prospective and existing customers eventually forget about them, and they go out of business. Your business exists when people remember you and know you. And you cease to exist when no one has heard of you.