This is the Barrier Free Choices Logo. Clicking it will take you to this website's Home Page.

Previous: Exploding the Myths of "Doom and Gloom" ProphetsReturn to our Business MenuNext Topic: Making Your Business Recession-Proof

Business Growth Opportunities During an Economic Downturn:
Thriving in the "Shadow of Recession"
Illustration: A man with darts in his hand "sights in" on his target.
[2] Growth Opportunities Abound
During "Economic Downturns"

During "economic downturns" or during the perceived threat of a downturn, or when sales begin slowing down, most businesses start looking for ways to cut their costs.

Some business managers rush to get rid of marketing directors and PR consultants, and begin slashing their advertising budgets, desperately hoping to reduce expenses.

Experts call this a suicidal strategy. Yet shortsighted managers often do it.

However, if you are quick to take advantage of your competitors' suicidal tendencies, you will be in a prime position to dramatically expand your company's market share.

In a Slow Economy it is Vitally Important to INCREASE Sales and Marketing Efforts!

Cutting back your selling and marketing efforts will rapidly diminish your gross sales, because many of your existing — and prospective — customers will buy less from you, and start buying more and more from those competitors who continue to advertise their products and/or services aggressively and effectively. The market share your business LOSES by cutting back on your marketing efforts may take a long time to return — if it ever does!!!

During times of economic contraction it's a good strategy to send an even stronger message to prospective customers. This is particularly true if your business provides something consumers are still likely to buy during a downturn: Then the only real questions are: [1] how much they will buy of what you sell; and [2] whether they will buy it from you — or from your competitors.

Here's good advice
from a recent Business Week article, "How to Market in a Recession":
1. Research the customer: Instead of cutting the market research budget, you need to know more than ever how consumers are redefining value and responding to the recession. ... Consumers take more time looking for the best value per dollar spent [and] are more willing to postpone purchases, trade down, or buy less.
2. Focus on family values: When economic hard times loom, people tend to retreat to familiar territory. ... Uncertainty prompts us to stay at home but also [to] stay connected with family and friends [whether in person, by phone, or online].
3. Adjust product portfolios: Marketers must reforecast demand for each item in their product lines as consumers trade down to [products] that stress good value, such as cars with fewer options. ... New products, especially those that address the new consumer reality and thereby put pressure on competitors, should still be introduced but advertising should stress superior price performance, not corporate image.
4. Adjust pricing tactics: [Consumers will shop] for the best deals ... In tough times, price cuts attract more consumer support than [abstract promotional tactics such as] sweepstakes and mail-in offers.
5. Stress market share: In all but a few technology categories where growth prospects are strong, companies are in a battle for market share and, in some cases, survival ... Companies with [the most productive cost structures] will gain market share. And companies with healthy balance sheets often do so by acquiring weak competitors.
6. Emphasise core values: Economic recession can elevate the importance of the finance director's balance sheet over the marketing manager's income statement. [Excessive focus on management of] working capital can easily dominate [and severely damage] customer relationships. CEOs must counter this [paranoid "bean-counter mentality" that thinks "cutting costs" are more important than "sales efforts"]. Successful companies DO NOT abandon their marketing strategies in a recession; they adapt them.
7. Maintain marketing spending: [A recession] is not the time to cut advertising. It is well documented that brands that increase advertising during a recession, when competitors are cutting back, can improve market share and return on investment at lower cost than during good economic times. [Consumers] at home watching television or surfing the 'net can deliver higher than expected audiences [at less cost]. Brands with deep pockets may be able to negotiate favourable advertising rates and lock them in for several years, and even small businesses can advertise on the internet. ... Expanding your internet presence [and increasing] the use of direct marketing [will return a] more immediate sales impact.
"Downturns" — Great Opportunities to Expand Your Company's Market Share!

Dun & Bradstreet's All Business provides a wealth of resources and advice for both large and small businesses. Tips excerpted from their article on "Recession-Proof Marketing":
An economic slowdown [presents] outstanding opportunities for companies prepared to get ahead ... Managers who wait until a recession is upon them to formulate a marketing strategy will lose sales to companies already ahead of the game ... [During a slowdown] it's easy to increase your competitive position.
Don't cut back on marketing during hard times, but rather use the situation as an opportunity to build your brand and aggressively pursue new customers. During a recession the costs of marketing ... fall with lowered demand. Companies that keep spending high can ... get more marketing firepower per dollar, and [thereby] gain an advantage over competitors who cut budgets.
[While] less-prepared companies [may be] forced to slash marketing budgets ... [companies aiming for growth will increase their] marketing expenditures and shift their strategy from mass media advertising to Internet and direct marketing.

"Picking Up the Chips" as Weaker Players Disappear From the Table:

Unfortunately, some of the "less-prepared companies" alluded to by Dun & Bradstreet really will be at serious risk of going out of business during a downturn. And if they do, their former customers still need somebody who can provide products and services they need and want.

During times of economic turbulence, businesses that can meet consumer needs will gain new customers. Some businesses will even acquire their former competitors, thereby gaining an even larger share of the marketplace. We've seen it happen quite a bit in recent years. And if you stop and think about it for a moment, so have you.

The next topic in our Business Section provides tips on how you can make your business more recession-proof

The "References" link at the bottom of this page provides access to information you can use to
[a] understand business cycles a little better; and [b] learn more about additional market segments that may be very profitable for your business.

This is the BarrierFreeChoices logo. Clicking on it will take you to our Main Home Page.
References: [ Additional "Recession/Depression" Resources | No Java? ]
(opens in a "new" window, so this page will still be here when you're done)

ICRA - Internet Content Rating Association. Our Site has been certified safe for family viewing.Level A conformance icon, W3C-WAI Web Content Accessibility Guidelines 1.0Wikipedia Affiliate Button
Text, photos, and original graphics herein are © 1993-2013 Barrier Free Choices, Inc.
The "wheelchair through the doorway" logo is a Registered Service Mark.