Don't waste the recession period
Posted on 25. Sep, 2009 by Franz in Web Marketing
Why waste golden periods?
Marketing has definitely evolved over the years – Look at where KTEL has brought rich media advertising today. Their bad decisions into real estate made all the difference. And when they went through a stroke of bad luck back in the 80s’, KTEL founder P. Kives didn’t back down.
I invite you to share a short story about your experience. Goto the comments section.
comScore’s Magid Abraham recently posted a blog post about “Recession is a terrible thing to waste”; and I share his views on this particular subject. If you read and understand what I’ve said back then about recession, you’ll probably get the concept and idea both of us are trying to tell the world. It’s the same: Recession is the time to bloom, bloom and bloom. It’s a test of how well you’ve managed your whole business & finance. It’s like a bundled up examination that tests your skills years back all the way to the present and probably the future.
Magid states that “the Internet Media and e-commerce markets have been hit pretty hard and their growth has slowed significantly” and “Many young Internet companies are having funding difficulties. Established companies are reducing their marketing budgets“. This goes to show that proper financial backing is critical at all times; and with proper CFO services (we highly recommend this company), you’ll be able to sustain the recession and REAP its attractive benefits from there.
What attraction in a recession period?
The one great thing about being able to thrive in a recession period is to gain the upper hand on pricing. Since businesses are desperate for sustainability and survival more than pushing forward for maximum growth rates, this is the time where you set your prices, sign in a contract and get products/services at cheaper rates.
- Take office rent as an example. Some companies close down – Vacant offices are available. The landlord needs a quick fix. You throw in a price lower and lock in 2-3 years below average price par.
- In the Internet adspace, PPC generally works much better at this particular period of time. Competition (geographically speaking) is slightly lower, highly paid ads are not constant anymore – Some have been taken off. Average bid rates are low.
- Outsourcing opportunities. For those who are retrenched, you can use these people (media-influenced recession) and pay them at a much lower rate for their services. Of course, this comes with tactics of engagement.
You pretty much get the point. I don’t think I need to elaborate further on this matter.
A vigorous cost-reduction strategy
Great recessions don’t come by easily. Blame it on corporates or whomever you want – But if you’re prepared for this, it serves a good opportunity for small companies that are well financed to actually flourish.
In my previous post about recession, I spoke about recession being the center of opportunity for the well prepared. Of course, prices won’t drastically drop in a day or week, but if you keep up with industrial trends (which also helps for relationship management purposes), you can sometimes figure out the bottom line.
Magid talks about company acquisition quoting Jack Welch, “Buy your competitors and bury them.”. Of course, this is a good way of doing things. But this tactic does not help small companies that much. Small companies can actually grow many times faster than their average forecasted growth rate during recession if they push the right buttons:
- Tenders may be hard to come by, but if they do, they know who to look for. It can because of price or try-outs.
- Companies lick their wounds and go back to basics. They now explore small little opportunities they can take to survive and champion small doings. So you can ask yourself: “Where do you stand?”
- Labor volume increases and intensity of job search is heightened. For small companies, this is your chance to get professionals in.
- Contractual ‘pay less first’ clients with their cheques rolled out in a period of 2-3 years of repayment period will come by easier for the service industry.
Do you have another opinion you’d like to share? If so, I’d very much love to hear from you. Tell me more about it.
