Tag Archives: recession

Market Share is Not Recession Proof

I was reading the Three Minute Manager in the March 30 issue of Fortune magazine. The first question asked to the CEOs of Staples, TD Ameritrade and Head of Global Customer Strategy for Bain & Co was “Is it really a good time to go after market share” and their answers were a resounding “yes”.

Most of your competitors are in the same place you are – focusing on revenue and expenses.

You may have gone through your first, second and maybe even third round of cost cutting.

The last thing on your mind is market share. You figure your competitors are most likely cutting their marketing budgets so things should remain status quo except for the one or two weaker competitors who go out of business.

Since when is status quo okay for business?

A recession – especially a deep recession – is the best time to increase market share since it is significantly cheaper to stand out compared to your competitors who may no longer be marketing.

Think about share of voice – similar to market share but determined by your share of media impressions.

For example, everyone in your industry spent a total of $10,000,000 in advertising last year. Your ad budget was $1,000,000 giving you a 10% share of voice.

This year your industry’s ad spend is only $5,000,000. If your budget remains at $1,000,000 you grow your share of voice to 20% thus taking a more dominant role in your industry without increasing your cost. That increased share of voice leads to greater awareness and ultimately more prospects. (Sorry, but it is still up to you to close the sale).

If you reduce your budget by 25% to $750,ooo you are able to achieve a 15% share of voice – thus spending less, yet achieving a greater impact than the $1,000,000 investment made the year prior.

By continuing to market your company, you can actually gain market share more cost-effectively and be in a stronger position when the economy rebounds.

But you have to continue to market because if you stop marketing – even to your customers – someone will take your share of the market.

It is your job to market frugally, but not so much so that it is ineffective.

Here are some things you should consider to hone your marketing effort:

  • Look at what tactics are having the greatest return on investment. (A previous post on tracking speaks to what you can do to know what marketing tools are working best.)
    • For example, if you are in a service industry like plumbing, HVAC, etc, the thought of cutting Yellow Page advertising is terrifying, so move slowly by cutting your ad from a spread to a single page and track the changes.
  • Continue to aggressively pursue inexpensive ways to market to your customers.
    • Email newsletters
    • Service reminders
    • Phone calls
  • Implement a customer referral program
  • Look for affiliation marketing opportunities.
    • For example, if you belong to your local chamber of commerce, provide all other chamber members a discount on your products/services.
  • Volunteer/Donate services – the free publicity will help you reach a broader audience

These are just five ways you can market smarter so that you can gain market share while it is cheaper to do so.

We hope you’ll use the comment section to tell us how you are gaining market share during the recession.

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Filed under Competition, Customer Marketing, Marketing ROI, recession marketing

Don’t Be Invisible In A Recession

An article in yesterday’s Atlanta Journal-Constitution reported a National Federation of Independent Business study regarding a decline in confidence.  “1 in 4” small business owners claimed a decline in sales as the main reason for their pessimism.

Thus the challenge, how can a business increase sales if it refuses to market itself.  These are difficult times for all businesses and business need to find ways to operate more efficiently and the same holds true for marketing.

With the right eye you can increase the effectiveness of your current marketing.  Look at the tools that are  working hardest for you.

  • Can you cut what isn’t working and invest more in what is working?
  • What can you do to increase business among current customers?
  • How successful is your referral program?  What can be done to improve it?
  • What inexpensive online tools are you using to generate business?  Pay Per Click, Search Engine Optimization, Social Networking?

Remember, the worst thing a company can do in a recession is become invisible. Instead keep marketing just market smarter.

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Don’t Market In A Recession

It’s official.  The Fed is finally uttering the “R” word.  So let’s stop marketing or even doing business altogether.  If people had that same attitude during the 1970s recession we’d be missing out on a lot.

I was reading in AdAge this week that three very well know companies were started in the last “deep recession”; Federal Express, Microsoft and Creative Artists Agency.  

Time Inc. introduced People magazine. (It is also noteworthy they started Fortune during the Great Depression).  

Price Club – the precursor to Sam’s Club, Costco and BJ’s was started.  

Procter & Gamble introduced Pringles and ERA detergent.

So as the title of this blog says, don’t stop marketing, market smarter.

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