So…is it safe to leave the house yet?
The 2020s – even though they’re barely two years old – repeatedly remind me of the tagline from Jaws 2: “Just when you thought it was safe to go back in the water…”
It really has been a crazy couple of years, hasn’t it? In fact, the last five or six years have been simply extraordinary, in the true sense of the word. And I’m guessing that the next several years may be challenging on a few fronts, as well.
As if to highlight that last point, the Russian invasion of Ukraine two weeks ago felt like a wake-up call that just because Covid-19 was (hopefully!) getting closer to fading away, we probably shouldn’t expect a return to normalcy anytime soon.
And given the jittery stock market and the reappearance of inflation for the first time in ages, where does that leave the attorney or accountant who’s trying to make smart business decisions for themselves and their firm?
Marketing: It’s Not Just for Sunny Days
Well, if an economic downturn does arrive on our collective doorsteps, the old Madison Ave. wisdom still holds: Don’t let up on your marketing just because you happen to be in the middle of a bad economy.
Now, I hear you say, “Wait a minute – why should I listen to some marketing guy telling me to keep the pedal to the metal on my marketing campaigns, even when the going gets tough?”
But hear me out. Because it’s not just Mad Men who actively encourage businesses to keep their marketing spend high. Multiple studies and analyses show that businesses that continue to focus on marketing throughout economic downturns emerge from those tough times far ahead of those firms that slashed their marketing budgets.
For example, in a Harvard Business Review article from August 2020 entitled, “Don’t Cut Your Marketing Budget in a Recession,” the authors reported:
Companies that have bounced back most strongly from previous recessions usually did not cut their marketing spend, and in many cases actually increased it.
That’s striking, isn’t it? In many cases, the companies that bounced back actually increased their marketing budget. Professors Nirmalya Kumar and Koen Pauwels went on to report that these high performing companies “did change what they were spending their marketing budget on and when to reflect the new context in which they operated.”
A couple of interesting points there: They changed the types of marketing they were focused on, and they were sensitive to the “new context” (AKA the changed environment) in which they were working. The researchers expanded on this by indicating the following:
In this new environment you must accompany your customers on their new, different journey, shifting your message and even re-engineering your value proposition.
Great insights! In tough times, your customers/clients find themselves on a new and different journey, and they’re looking to you [or to someone] to recognize and reflect that fact. And then, the coup de grace:
This is a time not to stop spending money but a time to change how you spend it.
And then, they concluded with a final insight:
It is also an opportunity, because firms who are willing to be what customers need in a recession get to keep many of the new customers they get – and cement the loyalty of those they already had.
These are arresting findings, wouldn’t you say? At least some of these would definitely seem counter-intuitive. But what should the takeaways be for a small law firm or accounting firm?
In the big picture, I think it suggests that there is always opportunity, even in the most unexpected times and places. For example, if you’re just starting your firm, never forget that Walt Disney Productions was launched in 1929, Hewlett-Packard in 1939, and Microsoft in 1975. (Very different times, but none of them ever could be called the best of times, especially for starting a business.)
In the same vein, it also suggests that a rainy day at the football stadium, disappointing for tens of thousands of spectators, can mean a golden opportunity for others to sell ponchos in the parking lot.
Bringing this back to the here and now, it means that even more important than the timing of a venture is how responsive that venture is to its surroundings. In tough times, are you able to be what your clients want you to be? What they need you to be?
If that sounds like a heavy lift – and it can take some work – think about the payoff: As the professors made clear, you can cement the loyalty of your clients because you were there for them.
This sounds like a project for strategic marketing. And with that in mind, this may be a good time to ask: How’s your marketing been working for you?
Can Your Marketing Work Smarter?
While each of us is repeatedly told that we should “work smarter, not harder,” how many of us have been asking our marketing to do the same?
Whether the economy is doing well or not, you should always demand that your marketing work smarter. (Does it really make sense that we ask less of our marketing than we do of ourselves?)
And making that demand of our marketing may be especially important this year. Whatever your marketing budget was in 2021, you should ask those dollars to work smarter in 2022.
Here’s some good news: If you discover that you absolutely must cut your marketing budget this year, you could possibly still come out ahead.
How might that happen? One way is if a whole bunch of your competitors decided to slash their marketing budgets this year. That would clear a nice path for you to dominate the marketplace, wouldn’t it?
But what if all your savvy competitors kept their marketing budgets the same this year – or even increased them?
What if they did that, and you ended up having to cut your budget? What if you had to cut your budget to 75% of what it was in 2021?
If all that happened, could you still achieve better results this year than last?
Well, it depends, of course.
But it’s certainly possible, depending on how you’ve been spending your marketing budget. As Professors Kumar and Pauwels proclaimed, “This is a time not to stop spending money but a time to change how you spend it.”
That said, all these good things won’t happen on their own. You have to be willing to take a couple of steps. First, you need to take a critical look at what you’ve been doing, marketing-wise. At NCG, we call that a marketing audit, which is basically a report card of your past year’s marketing efforts and their results.
Second (and here’s the hard part): You have to be willing to make a few changes to your marketing efforts.
And if you’re willing to take these two steps…well, anything is possible.
Even in this crazy and unpredictable world.
Give us a call if you’d like to discuss what this might look like for you and your firm. Let’s see if we can make 2022 a great year for you inside the office, no matter what’s happening outside the office.