Protecting your Brand during turbulent times
I hesitate to use the R-word as we can talk ourselves into one. However, the current cost of living crisis and looming Recession, there I’ve said it, is wholly caused by factors outside businesses’ control. Of course, we all know that downturns are cyclical, every ten years or so, and that eventually, things will improve, but it doesn’t make it any easier to deal with when you are in the thick of things.
I was asked what I thought about the Recession. I thought about it and decided not to take part.The famous words of Sam Walton, the founder of Walmart, who knew booms and recessions are an inevitable part of life.
I have been through numerous periods of turbulence in my time in business, but none like we have experienced over the last couple of years! Extreme political and economic turmoil certainly doesn’t make things easy for the entrepreneur. Instinct is to shore up the finances and ensure your customer relationships are strong and your staff are as productive as possible. But what about your most valuable asset, your Brand?
Bad moon rising
After and during a healthy economic period, it’s easy to get lured into a false sense of security. So why prepare for the bad times ahead when times are good? We all usually prefer to wait until the do-da hits the fan. Such as now.
But let’s not dwell on the negative. What can we do to protect our businesses and brands in times of hardship? My advice is don’t do anything in a rush; thoroughly assess your situation first. Act in haste, repent at leisure, has never been more accurate. Then, once you understand your current position and where you want to be, you can plan the steps you need to take to get you there.
The value of your Brand
Your Brand represents the embodiment of your Company’s recognition, differentiation and positioning. To illustrate the value of brand equity, I want to quote a Coca-Cola Executive who once said:
If Coca-Cola were to lose all of its production-related assets in a disaster, the Company would survive.Coca-Cola Executive
By contrast, if all consumers were to have a sudden lapse of memory and forget everything related to Coca-Cola, the Company would go out of business.
The good news is that history shows there are opportunities during recessions. It is vital to position your Brand to capitalise on them.
Don’t cut back on your marketing
I know it’s tempting but do not cut back on your marketing to save money. It feels like an easy way to save money in the short term. But it’ll be a false economy and hurt your business and profits in the long run.
If you cut deeply into marketing and communications budgets when the economy is suffering a downturn, the cost to regain your market share when growth rebounds may cost you four or five times as much as the cuts saved.
In good times, people want to advertise; in bad times, they have to.Bruce Barton (1886-1967), American business executive and Congressman
In times of crisis, strong marketing and branding will go a long way to protect your market share. Refrain from cutting yourself off from your customers and potential customers by not marketing your business. If you are not visible in your market if you don’t come up in search engines if potential customers aren’t seeing your adverts. How will you ever get a steady stream of customers (your greatest asset, after all) and maintain any profits? Let your competitors cut back on their advertising: less advertising means less competition for consumer attention.
Research your market and customers
Research shows that businesses that continue to advertise during a recession experience greater sales when the economy picks up than those that stopped advertising.
Take a look at the positioning of your Brand in your market. Diversify your offering to meet changing demands and consumer needs. Consumers want to save money, and this is especially so in a recession. It is essential to work out what consumers are looking for in your market and how to reposition your Brand to best take advantage of this. Do a brand audit and look at how your competitors position themselves.
Staying in regular touch with your customers is critical to customer retention as it makes them feel appreciated and connected to your brand. Consistency of brand, messaging, and timing of these communications is vital to their success.
The true strength of any relationship is measured in bad times, not good.Miles J. Stanford
Send your current customers a questionnaire to take the temperature of the market and feelings about your Brand. Use this research to differentiate your Brand from its competition. The answer is usually to present more perceived or actual value to a customer. Give more to retain more. Customers will want their pound to work harder for them during a downturn. Be there to provide the value for the money they are seeking. What habits are likely to emerge when times are hard? During COVID, video conferencing, food and goods home delivery, and online entertainment were the winners.
Consumers tend to look at spending and assign products and services into four categories:
Essentials – are perceived as necessary. Everything we need for day-to-day survival and central to our well-being. For example, food, drink, utilities, transport, and healthcare;
Treats – these are the justified indulgences that make us feel better about our situation.
Postponables – just what it says on the tin. We want to buy it but don’t need it and can’t justify the purchase. But when we feel more confident about our situation, we will purchase it.
Expendables – unnecessary purchases we definitely won’t be buying these anytime soon.
If you can keep your head when all about you,If. By Rudyard Kipling
Are losing theirs and blaming it on you,
If you can trust yourself when all men doubt you,
Quality offers value
If you are selling a high-quality, high-price brand or service, sell to the longevity and robustness that a quality brand or service brings to the table. A buy once, buy better approach is the way to go. Avoid price cutting, this will end up being a race to the bottom, and no one will win.
Reasonably low-cost luxury items will find a market when times are hard. Who doesn’t want to make themselves feel better with a chocolate bar, bubble bath, new body spray or a cake?
Create opportunity amid uncertainty
There is an opportunity to look at new audiences or markets. Consider who else may benefit from what you offer and then tailor-make a product or service specifically for this market. If you currently need to do so, look at a global audience. Or look at a slight tweak in your product /service, which may appeal to a new market.
If you can’t make these adjustments to your current Brand or offer, why not launch a new brand as a trial to test your new approach? Don’t spend much time or money; bootstrap it and test your theory. Test, fail or succeed quickly, and then move on.
Focus and assess your media spend
Flexibility is key. Take a close look at which channels you are using. Which ones are achieving a return on your spending? Try changing it up; if a marketing channel doesn’t perform, you could find a better return elsewhere.
Let’s do a quick recap on the 7 key takeaways:
- Do not rush into anything. Stop and think
- Do not cut back on your advertising and marketing spend
- Do customer and competitor positioning research
- Diversify your offering or add extra value to what you do offer
- Retain existing customers by keeping in touch and making them feel valued
- Look at any emerging social habits that your business may capitalise on (like video conferencing)
- Do follow an agile business model to respond quickly to any changes in your market
- Do not feel like you are alone, reach out if you need to
You don’t have to do it all alone
The advice will cost, but it can save you from wasting money and time. Sometimes the wisest thing to do is to get some trustworthy specialist advice. Breathe Creative are always here to help. Please send me an email at firstname.lastname@example.org, and we can arrange to have a chat.
Further reading you may find useful
Why keeping close to your existing customers is more important than ever
The most challenging task in running a small to medium size business is finding and keeping customers…