Why protect your business from an economic downturn?
When customer buying slows, small businesses are typically the hardest hit. Recessions are a normal part of a business cycle, so it’s important for owners and managers to plan for them and secure a strong market share in advance of any dramatic changes in the economy. If you understand and prepare your business for the event of an economic downturn or recession, you can help protect your business from losing profits or shutting down. It’s essential for business owners to prepare their organizations before any major economic shift to ensure their businesses can weather the storm.
9 ways to prepare your business for a recession
Here are the steps you can take to recession-proof your business and prepare for an economic downturn:
Reduce or eliminate low-profit products or services
The first step in preparing your business for a recession is examining your current revenue to determine the profit generated from your products and services. By analyzing sales data to evaluate the profitability of your offerings, you can gain a better understanding of your financial situation. Unless the low-profit products or services have a strategic value to your organization, you can consider reducing or eliminating them and putting more effort into higher-profit offerings..
Focus on your current customers
It’s economically efficient to focus sales and marketing efforts on current customers rather than attempt to gain new ones continually. If your business model allows for it, consider focusing your efforts on retaining existing customers and keeping them coming back to you for more. Selling to your existing customers involves strategic planning, especially during an economic downturn. If your business model relies on new customers for a majority of your revenue, consider turning your existing customers into referral sources through creative methods or activities.
Increase marketing creativity
Increasing your sales revenue might require you to increase your creativity when marketing your products or services. Since it’s easier to sell to your existing customers, consider developing a special offer or new promotion to appeal to those who are already familiar with your brand and products. Develop creative opportunities to increase brand awareness and recognition by leveraging emerging trends or technologies.
Here are some additional ideas that can help you increase your marketing creativity:
- Develop a referral program to reward customers for recommending your business.
- Create a newsletter that provides value to your customers and provides information about your sales or products.
- Stay in touch with existing customers by sending personalized emails asking about their recent purchases, collecting feedback, or requesting reviews.
- Increase your social media presence to further customer engagement.
Focus on your online business practices and presence
You can develop your online business practices by moving your operations to a cloud-based platform or using automated marketing software to connect with your customers. Spending the time yourself or working with an agency to develop sales sequences to maintain regular contact can help you increase your brand recognition and improve sales. Ensuring your customers can find you online easily and access important purchasing information can allow you to focus your efforts on business development while improving your lead-generation process.
Here are some additional ways you can increase your online business presence to generate more leads and convert them into high-paying customers:
- Optimizing your website to rank higher on search engines
- Perform market research to improve and optimize your website keywords and phrases
- Create or improve your Google My Business page to ensure customers are finding relevant and helpful information about your business and offerings
- Reviewing your website content to ensure it’s working strategically to improve leads
Increase your understanding of your customer
If you know who your customer is, where they like to shop, how they prefer to receive information, and what their decision-making process is like, you can improve your marketing efforts and increase revenues. By taking steps to understand your customer through website analytics and visitor profile reporting, you can optimize your marketing efforts and budget. Consider reviewing your sales and website analytics to help you create visitor profiles that you can use to appeal to your target audience.
Improve customer segmenting in marketing initiatives
When businesses don’t understand their customer segments, they often engage in a “spray and pray” approach to marketing, which involves mass marketing to the general public. While this may generate some interest, it’s more effective and cost-efficient to improve your customer segmenting and target these groups specifically. Use your visitor profiles created from your data analysis to evaluate how you can reach these segments successfully. It’s important to remember that segmenting requires you to change your tone of voice and messages to appeal to specific demographics and audiences.
Evaluate your customer experience
Part of improving your relationships with current customers involves evaluating your customer experience. Is there a particular aspect of your sales process where you are losing prospects to your competitors? How might a new customer interact with your site and find information required to make a buying decision? Considering the answer to these questions carefully can help you evaluate your customer experience and make improvements to retain prospects and convert them into loyal customers. If your business has online reviews or a method of collecting feedback, it’s important to analyze this information and take steps to improve the experience to keep customers coming back.
Analyze what your data is telling you
Data doesn’t lie, and learning how to capitalize on what your data is telling you is an important aspect of recession-proofing your business. Reviewing your website and sales analytics can help you better understand where your website content is losing customers, what interests your audience the most, and how you can leverage this information to optimize your content and offerings.
If your business runs digital marketing campaigns, it’s important to review your data to decide which advertisements are resonating with your prospects, what channels are bringing in the most qualified leads, and how you can adjust your efforts to optimize your budget. If data analysis isn’t one of your skill sets, or you simply don’t have time to sit down and sift through the data, consider hiring someone to help you figure out how to use your available data to maximize your marketing efforts.
Consider adopting new technologies to increase automation
While it’s tempting to consider a recession as a time to strictly conserve financial resources, it’s actually an ideal opportunity to adopt new technologies that can help automate or simplify business processes. Technology can help make your business more efficient and flexible, which allows for operational improvements. Automation can also help your employees focus on “human tasks” and use the technology to perform the mundane or repetitive tasks that often take up significant time to complete.
Here are some additional benefits of adopting technology during an economic downturn:
- Increases the opportunity for remote work, which may help decrease office-related expenses
- Enables you to optimize processes and increase productivity
- Facilitates enhanced customer service, which can help increase revenues
- Allows you to automate tasks and focus on tasks that require more strategic thought and energy
If you’re looking to transform your website to protect your business from a recession, you might be interested in our Must-Have Website Tune-Up. Our sales-first approach can update your website and give it a reason to live.