During an economic recession, some companies seemingly thrive while others struggle. What differentiates the former from the latter? How can companies shield or protect themselves from these challenges? What strategies can they implement to ensure they survive?
Here are a few tips:
1. Strategy without research is just an opinion
This is something we preach at TEAM LEWIS. This statement could not be more true when the economic environment is tenuous. Business decisions need to be made based on available information and they need to be made quickly. The companies that fared poorly during the ‘Great Recession’ did so because “they switched to survival mode, making deep cuts and reacting defensively.” Panic-based decision making is not using information and data appropriately. What information and data can you access to make informed, smart decisions about the environment your company is facing? Who has the most knowledge about the various aspects of the business? Sometimes that may be the person at the local level or people who have regular contact with customers. Seek out information both internally and externally to make decisions that educate you on the circumstances surrounding your organization and pivot as needed.
2. Don’t abandon marketing
Yes, it seems like when times are tough you may need to cut costs or reevaluate ways to save, but there are many ways to cut costs and marketing may not be your best bet. During a recession, people spend less money going out and doing things and spend more time sitting at home, probably online, scrolling their social media channels or watching TV. If your competitors are cutting costs this way, it is a great time to focus on the right channels to reach your audience. Do you know what channels your target audience is using? What messaging works best? Research can help you ensure that you are targeting the right people with the right message while measurement teams can help you adjust and tweak those campaigns to ensure success. If you do these things well, you will stay top of mind with your target audience and can even gain market share if your competitors decide to slash their marketing budgets. Now is a great time to invest in SEO. You need to show up in search and it is easier to rank when your competitors aren’t focusing on good SEO and content strategies. Also, maintain a customer-centric mentality. Invest in keeping your most loyal customers happy. Make sure you are reminding them that you appreciate their loyalty.
3. Reevaluate your value
What is your unique value proposition? What can you do that no one else can? How can you help your customers more during this challenging time? How do you do it better than your competitors? We ask our clients these questions regularly and, sometimes, it may surprise you to hear that they don’t always have the answer. Now is a great time to reexamine what your competitors are doing, how they are messaging, and what you can do to stand out from the crowd.
4. Invest in technologies that make processes more efficient
Many companies hold off from digital transformation because of the high costs to implement, but costs usually go down in a recession and you may get more for your money and make the necessary changes required to do your business at a lower cost over time. This strategy requires a longer period of time to get the reward, but it could pay off significantly if these technologies improve your supply chain or help maintain customer relationships. Sustainability is often pushed to the side during weak economic periods but making your company more sustainable and efficient now will help you get ahead of your competitors down the road.
5. Don’t forget your employees
Your employees are your biggest advocates. Treat them well. Understand that this is a stressful time for them too. Check in on them. Ask them what is working and what is not and adjust as needed. Listen to them. Great ideas can be sparked if senior management is willing to be open and hear from employees. Feedback loops are essential.
Companies that make educated and data-based decisions will fare better during the next several months if they use the information that is available to them, but sometimes companies don’t know where to start. Curious how TEAM LEWIS can help? Reach out, let’s chat.