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• A Marketing Meditation for Recession Jitters

  By Burkey Belser

  Posted on November 26, 2007 at 5:00 pm

  
  
  

  You will learn:
  1. Why you shouldn’t stop marketing during a recession.
  2. How you can emerge from a recession as a market leader.
  3. Ideas for growth despite a sluggish economy.

  There’s not much that gives management of professional service firms greater pain than reports of a potential recession or a prolonged unstable economy. Poor economic conditions quite often lead to uncertainty within firms, and the costs of marketing efforts are always an easy target of scrutiny. One thing is certain: the U.S. economy is in a funk. Inflation is on the horizon; the housing market has banks in turmoil; oil prices are hitting record highs; and the stock market is experiencing more ups, downs and corrections than a mountain road under repair. All of these issues only increase the fear that a recession might be around the corner and that the growing profits at professional service firms might be in danger of slipping after a long period of steady growth. As firms start preparing operational budgets for the coming year, discussions of belt-tightening are being heard in the halls once again.

  Marketing 101 tells us that in times like these, the best prescription for an organization’s stability and success is to, at a minimum, stay the course. An even better course is to be aggressive and capture market share from those competitors that hunker down until the economy rebounds. Intellectually, this makes sense. However, convincing emotional shareholders not to take the conservative route in an effort to protect their cash flow is a bit more challenging.

  So, what’s the answer? Although there is no survival guide for marketing during an economic downturn, there are some good remedies to help lessen the severity of recession jitters.

  1) Don’t stop recruiting.

  One of the biggest errors firms made during the last economic downturn was to cut back on their recruiting efforts. When the economy began to improve, the rush to hire more lawyers became a real slugfest with firms battling it out to get any qualified lawyer in the door. Keep your lateral and student recruiting levels near or at the same level that they are now, and you won’t have to lower your standards later just to get professionals to fill the empty chairs.

  2) Segment and target.

  Examine where your revenue is coming from and develop a hit list for cross-selling. Of course you know who your top 50 clients are, but do you know what they really want or need? Now is the time to do that data mining you’ve wanted to do for a while. Get your professionals to ask your key clients what else you could be doing for them. Consider creating unusual direct mail promotions that will cut through the clutter and impress other potential buyers at firms where you may have existing relationships that could be developed further.

  3) Show up and share the knowledge.

  Rainmakers are going to use this time to really increase their one-to-one meeting opportunities. Visits to client’s offices should definitely be high on your list of marketing tactics—but do more than just check in. Now is the time to develop a unique CLE program or branded educational workshop for clients as a value-added benefit. Also look for trade shows where clients can be found in abundance. Sponsoring events can highlight your industry knowledge and demonstrate your support for your clients’ business interests. (And you can really get some bang from your buck by reaching a large pool of current and potential clients in a single location!)

  4) Promote new practice units and innovation.

  The father of modern marketing, Peter Drucker, suggests that, in an economic downturn, organizations should deliberately look for ways to leverage changes in the marketplace into business strategies that express your organization’s innovation and entrepreneurial spirit. Take this opportunity to watch market conditions closely and look for ways to repackage or reposition existing services that respond directly to the shifts taking place in the business community. For example, energize your environmental practice by developing a group that helps companies develop and implement “green” strategies.

  5) Look beyond the 1,000.

  In a tight economy, firms are going to be fighting harder to retain market share with their largest corporate clients. Big corporations are already pressuring their professional service firms to provide them with greater “value” in the form of price incentives. Certainly, do everything you can to retain your share of the pie, but also look at how your services might benefit mid-market and smaller companies where the competition is less fierce. Develop a special annual report showcasing the types of work your firm has done for small businesses. It could highlight your understanding of the unique challenges mid-sized and smaller companies face.

  6) Keep the conversation going.

  Now more than ever, keep communicating with your current and potential clients. In a sluggish economy, people still need professional services—some areas are in even greater demand. Make the most of a less cluttered market by having your marketing message appear where others are not appearing. Increasing your advertising may be an obvious tactic, but consider new outlets like digital marketing via branded email alerts and banner advertising on industry or association Web sites that your buyers frequent.

  7) Outsource your media buying.

  As a single buyer of advertising you may not be getting the best possible rates or placements that an agency or media buyer can get. In a soft economy, media outlets look to their biggest buyers for more ad pages. Outsourcing your media buying gives you the purchasing power that a single buyer can rarely achieve. Put your media planning in the hands of a professional who can negotiate the best deals possible and make the most of your media budget.

  8) Understand the strategic value of a strong brand.

  A well-developed brand that is clearly articulated and understood throughout the firm reaches far and wide. Brands are strategic assets and not just a simple tag line or slogan. Take advantage of this time to evaluate your firm’s brand promise to uncover the unique aspect of your service. Develop a plan to inform everyone within the firm of your greatest assets to increase your market share through effective conversational branding. If you lose confidence in your brand’s promise, your clients may lose their confidence in you as well.

  Finally, it’s important to remember that the work you do during times of economic unrest tend to result in greater returns (more quickly) when the economy begins to return to more stable conditions. The share of market you earn during periods of recession jitters generally translates into greater gains in profitability in subsequent periods.

  If these marketing prescriptions for success are still hard for management to swallow, offer them Rolaids (available at most local pharmacies).

  Tags:

  Advertising, Marketing, Recession, Recruiting, Thought Leadership 

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