Building Business in Tough Times

Author Barbara Wirtz, Published in Credit Union Executive Newsletter

A poor economy, stiff competition, unrelenting change all add up to tough times that make it difficult to grow and prosper. When things tighten up, people and organizations tend to tighten up as well. Budgets are slashed, nonessential spending is curtailed, hiring freezes are implemented-do more with less becomes the mantra. In this quest to reduce costs and save money, some common mistakes are made in the name of tough time strategies.

Tough time strategies do require wise decisions about how and where to spend your dollars but often dollars are eliminated or significantly reduced in three essential areas to tough time survival: marketing, innovation, and employee morale. When making decisions for your business, avoid common mistakes organizations make in tough times by following three "don'ts":

Don't stop marketing.

Don't stop innovating.

Don't neglect employee morale.

Don't stop marketing: A common mistake businesses make in tough times is to cut back drastically on their marketing. This may save some money in the short-run but it'll end costing you a bundle in the long-run. You run the risk of out of sight; out of mind-and possibly out of business.

Marketing in poor economic times can actually have more impact than marketing in better times.

Fewer organizations are out there marketing so your message will have greater visibility. And if what you offer helps customers solve their problems or makes their lives a bit easier in tough times, you'll reap the benefits of being seen as a beacon in a dark forest. Continuous marketing conveys staying power and provides a foundation you can springboard off once things start to improve. Those who leave the public's eye during tough times have a much harder time reestablishing themselves during better times.

Think of your marketing as a workout routine. To be effective, it's got to be structured, ongoing, and frequent enough to make a difference. Years of building brand awareness, name recognition,and customer loyalty can quickly be eroded by not placing that ad, not sending promotional material, not sponsoring that event, or not getting your name in the news. Stopping your marketing is like stopping your workout routine: you lose a lot of strength, flexibility, and stamina in a very short time. And sometimes you can't regain it or you can't regain it quickly enough. Stay in shape so you'll be ready for the marathon when things get better. No matter what happens, keep marketing.

Don't stop innovating: Another common mistake businesses make in tough times is to reduce their innovation. Innovation lies at the heart of navigating your business successfully through the rough waters of tough times. It'll be creative, innovative ideas that solve real problems for real people that will make the difference between businesses that do well and those that don't.

In tough times, businesses often find that what they've always done doesn't seem to be working as well anymore. Instead of doing more of what you've always done, try doing more of what you've never done. Use "what if" thinking: what if we could... what if our customers could ... what if we no longer ... "What if" thinking stretches the mind and reaches the soul. It can lead to greater imagination and inspiration which can lead to new markets, new products, new services, new approaches-which just may be the thing others will need and respond to. Tough times are not the times to pull in the turtle's shell; it's time to stretch out, look around, and develop something better. No matter what happens, keep innovating.

Don't neglect employee morale: No single person can improve the situation for your business alone in tough times; you need the combined efforts of all your employees. You need them to believe in you and your business more than ever and to be willing to work harder and more productively than ever before. This is not the time to shake their world anymore than it's already been shaken by their own experience in a poor economy. They have their own problems to face: possibly a spouse has been laid off or they're struggling to make ends meet themselves or they've lost a significant portion of their savings. Coming to work should not add even more stress and anxiety to your employees' lives.

Find ways to appeal to your employees' desire for reliability, safety, security, and peace of mind. Be a haven where they feel important, needed, respected, and protected. This is a case where "give and you shall receive" is true. Prove to your employees that you'll stick by them in thick or thin and they'll do the same for you.

People and organizations can make one of two decisions in tough times: hand over their future to fate or take charge of their own future. The unsuccessful ones will be heard saying things such as "There's nothing we can do about it," "Let's wait and see," or "We can't expect much right now." The successful ones say things such as "What else can we do? What other path can we take? How can we make things happen for ourselves and our customers?" It's a different mindset and one that only comes from people who feel closely connected and deeply committed to their employer. No matter what happens, build employee morale.

Marketing, innovation, and employee morale are three essential elements of building business in tough times. You may have to get creative in the way you do these things because of your own reduced resources but if you want your business to be successful in spite of tough times, you must do them.

Market with passion and focus, innovate with energy and enthusiasm, and build employee morale with heart and conviction.

If you do, your business will do more than survive tough times; it'll thrive as a result of them.

RenÈ Gnam's Direct Mail Techniques Targets Business Audiences

Author, RenE Gnam, Database Marketing Guru

"When an advertising newcomer looks at Direct Mail, his first thought is consumer advertising," says consultant RenÈ Gnam, "because he's accustomed to seeing lavish promotions at home. But the biggest Direct Mail growth area is in business-to-business marketing."

Gnam initiates many response innovations and is a leading authority on the science of Direct Mail testing and the art of structuring persuasive copy and design for business and consumer markets. He appeared before the U.S. House of Representatives eight times as an expert on business mail, has
been the marketing consultant to the Library of Congress, the New York Republican Committee, the U.S. Department of Commerce, and was a major mailing list provider to Presidents Nixon, Ford, Carter, Reagan and Bush.

He cites the numbers reported by Dun's Marketing Services: "of 297 office equipment manufacturers, 60% increased their Direct Mail use, 89% always use Direct Mail for new product announcements, and 68% sell their products directly by mail. The median number of mailings for those companies is 10 per year and Direct Mail represents about 18.4% of their total ad budget."

Increasing Direct Mail Use For Business-to-Business

Gnam says Direct Mail is earning this increasing receptivity in business markets because it:

1. helps cut down on unscheduled sales calls,

2. brings information to re-study,

3. helps circulate information to other employees, and

4. brings news of products and services, news that is vitally needed as a firm seeks to control costs while hiking production. Gnam, who helped the U.S, Postal Service author regulations on Zip Code, says Direct Mail Marketing is infrequently practiced by kitchen-table operators hoping to make a fortune by opening envelopes, but rather "its a savvy business endeavor practiced by some of the world's largest corporations". including IBM, AT&T, and "all the generals": General Electric, General Mills, General Motors and General Telephone.

Direct Mail Warms Up Prospects for Salespeople

He praises Direct Mail's ability to inform, educate and persuade prospects who are inaccessible to salespeople. "Your Direct Mail supports the sales staff by warming up prospects before a call," he says. "You may think your company is too small to compete with a giant like Exxon or U. S. Steel," Gnam says, "but not if you use Direct Mail." He knows Direct Mail Marketing "lets the little guy tackle Goliath," and he offers this case history of how one small division of a giant corporation used mail advertising to establish a solid marketing base:

Norelco Lighting Supply Company is a division of the giant Norelco known for coffee makers, hair dryers and shavers.

Westinghouse sells light bulbs. General Electric sells them and so does GTE-Sylvania, but few Americans knew Norelco sells them, despite Norelco's world-wide position of being the #1 manufacturer of lighting.

How Direct Mail by Gnam Made Money for Norelco

In May 1979, Norelco Lighting had just one USA salesman and a savvy marketing manager who came to Gnam to give Norelco a better U.S. share of market. For New Jersey based Norelco, Gnam did three mailings from Florida.

MAILING #1, to North Carolina, was just a test to see if mailings could work. It produced only 39 leads from 16,000 pieces mailed, but 20 of those business leads became customers, better than 50% conversion to sales, with each sale worth $800 to $4,000 revenue PER YEAR, or a total of $16,000 - $80,000 A YEAR.

MAILING #2, to Michigan, produced 48 customers for revenues of $38,400 - $192,000 PER YEAR on flourescent bulbs. Nine months later, in February 1980, management hired a national sales manager, salespeople in two cities, and a staff copywriter to create more mailings.

MAILING #3 went to eight states. Expansion plans were then made for 30 states. By June 1980, within just 12 months, Norelco Lighting had become a multi-million-dollar business in the USA, selling many thousands of fluorescent bulbs at $1.30 each and incandescent bulbs (the kind you screw in your lamps) at 45c each."Perhaps your product sells for more than 45c or $1.30," Gnam chuckles, noting that Norelco Lighting now sells throughout the United States.

"Direct Mail," RenÈ Gnam says, "is a reliable source of revenue once your customer base has been clearly identified and once you have proven offers to make to that base."

Who are Homepreneurs and Why the Economy Needs to Take Notice.

by
Brenda Buffalin,
Bb's Creative


The largest majority of small businesses are now considered Homepreneurs: they are small business owners running viable enterprises from their homes. They do the majority of their work at home. They share one key common denominator: The control center-is based in the home and they are building successful small businesses that provide at least 50% of our household income by selling products locally, nationally and around the globe. Roughly 6.6 million home-based businesses fit the homepreneur description - 43% of the over 15 million home-based businesses in the US - and they are rarely regarded as significant players in the U.S. economy. Instead, the common perception is that home-based businesses are merely hobbies or side businesses contributing little to the business owner's income or the overall economy.

Due to everything from advances in technology to demographic and economic shifts, the number of homepreneurs is likely to surge over the next few years. Plus, many generate substantial revenue. About 35% have revenues of more than $125,000 and 8% more than $500,000. What's more, median household income is substantially higher than it is for the population as a whole: roughly $75,000 for homepreneurs vs. $50,233 for households in general. A recent study released by the Small Business Administration shows that about 50% of the growth-oriented small businesses surveyed that started in 2004 were home-based.

So the question becomes, why do small home businesses not operate like large corporations with a rotating CEO, a board of directors, a good marketing plan, business practices that ensure growth? If they aren't, they should. Every task a large corporation performs is easily done at a small scale level to help your company grow incrementally to its potential. Just take advantage of the services and coaching you can get for free at the Small Business Administration to gain the skills and savvy that takes your business to the next level. Start networking with other small businesses and pick their brains for solutions that challenge you. Do the necessary research on the internet for answers
to issues that come up and make you feel stifled. Applaud yourself for being one of the economys business sectors that will continue to grow in popularity and thrive even after the recession.

How Not to Ruin Your Reputation

Social Media "Gurus" have thrown out some tremendous statistics illustrating how everyone needs to embrace social media in order to succeed. As a result, one business after another is jumping on the social media boat and drifting away into the unknown. For those lost at sea, here is a disaster aversion plan that might help you save face. (And by the way, these are all things your mother told you.)

LESSON #1: Stop Trying To Be Edgy (Mind Your Manners)
Acting out your frat boy fantasies is not going to help you with social media marketing. Just because one risqué iPhone app did well with the masses doesn't mean your saucy approach is a good idea. You need to remember that you are dealing with a diverse group of people in Social Media Land, approximately half of which are women.

Women deserve respect, which should be a part of our upbringing. If you've reached adulthood and you still think you can get away with offending women, you have missed some important lessons. For now, suffice it to say that they are very active in the social media/app world.

Pepsi, a billion-dollar company, just pulled out its "AMP Up Before You Score" app. Let this be a lesson to you: don't kill your marketing apps on the altar of "edginess."
Pepsi Model:
iPhone App Development: $100,000
Marketing "Gurus" Who Approved It: 250,000
Cost of Damage to Brand Image: Priceless!

LESSON #2: Don't Go There...
There are some brand suicide areas you need to avoid. No matter what your Guru is telling you, stay away from PRRGNS = Politics, Religion, Race, Gender, Nationality, Sexuality. These topics have always been a house of pain, and can quickly throw things severely out of your control. Remember, brand building and controversy usually don't go hand in hand. Once damage is done by commenting on one of these forbidden topics, there is usually nothing you can say or do to make it better.

LESSON #3: The Thumper Rule
For those of you who need remedial Disney, this means, "If you can't say something nice...don't say anything at all." Personal attacks and negativity will always make you look like a child, so resist the urge to go Ape Shitake (Thanks, Guy) on someone. Take time to think before you type. Twitter and Facebook are not going to shut down in the next five minutes, so please relax and clear your mind before responding with negativity. Going code red on every comment you receive is only going to increase the risk of untimely death for you.

LESSON #4: Don't Give In to Peer Pressure
Just because you have a friend or competitor engaging in various types of social media, that doesn't mean you need to jump in. The important question is: Do you have something to say?
Answer = YES: Go ahead...Make my day. Start tweeting right now!
Answer = NO: Please get back to working on real world things, like improving your business to a level at which you do have something to say. Once you establish how you are different from everyone else, guess what? You will be ready to join the social media revolution.

LESSON #5: Don't Waste Your Time!
Don't you have some real work to do? Twitter and Facebook can be good tools, but put some limits on the time you spend there. Tweeting and Facebooking away your entire day makes your personal and professional life suffer. Your time is valuable - make sure you are allocating your time where it counts the most, and not getting wrapped up in endless social media spirals.

Yes or No to Flash???

Design a Flash Web site? Yes or no?

NO! If you are having a Web site designed for the first time, or considering a Web makeover and the potential designer tries to sell you on a Flash Web site. Run screaming – in the opposite direction!

Check out some of the most successful Web sites on the Internet – NONE of them are Flash sites. Shoot, Flash is made by Adobe and Adobe doesn’t have a Flash site! I wonder why . . .

Flash is a great tool for animation, movies, games, etc, but when it comes to a successful Web site, it’s an epic failure and here are about a dozen reasons why.

#1: Search engine optimization
This is the number one reason why you should NOT have a Flash Web site – you’ll never have the same SEO (Search engine optimization) success with a Flash site as you will an HTML site. Search engines simply can’t read Flash content and therefore do not get indexed properly.

#2: Mobile devices
Guess what – I can’t see Flash on my iPhone – and neither can your potential clients! And what’s more – Apple will likely never support Flash on any of their devices because of the resource requirements – the company is looking at HTML 5 for Flash-like viewing. Granted, not everyone uses an iPhone, but do you want to limit your potential audience???

#3: Bookmarking
When you visit a cool Web site and find some content you’d like to visit again, don’t you love the ability to bookmark that page? Well, guess what – you can’t do that with a Flash site! Oh, you can bookmark the page, but it’s always the same page – your bookmark will never take you back to the exact page you were interested in.

#4: Back button
Sorry, there just isn’t one. With a Flash site there is no way to navigate to the page your visitor was just on.

#5: How slow of a load can you wait for . . .
With a Flash site, the ENTIRE site must be downloaded before ANY content is viewable. With an HTML site content is instantly visible, even if the images take a second longer to load. How long do you like to wait for information?

#6: Text functions
Want to copy and paste content into an email and forward to potential clients/customers? Sorry – you can’t do that with a Flash site. There is no right-click menu and keyboard shortcuts just don’t work.

#7: CPU and bandwidth
Are all your clients using the most advanced computers on high-speed internet lines? Mine aren’t. Flash sites can take forever to load on slower computers and internet lines. Are you in the position to alienate potential clients because your site took too long to load and the visitor left – most likely to your competition with an HTML site? I’m not.

#8: Plugins
To view your site, the visitor MUST download the Adobe Flash Player on to his/her computer. No plug-in, no Flash, and, therefore, no site.

#9: Just because you CAN do something on the Web, doesn’t mean you SHOULD
This just might be my favorite reason why not to design a Flash site – but it also applies to all Web design. Sure, a lot of what you can do with Flash looks cool and can be fun, but after about five seconds it just gets annoying. Clients are coming to your site for information and content – give them what they want!

#10. Bad design standards
Most HTML sites have elements in common – it is these elements that help the visitor find what they want quickly. Navigation here, content here, links work like this, etc, etc. Flash Web sites have none of that so you risk your client getting lost – and frustrated – quickly. What happens when they get frustrated? They leave!

Don’t limit your Web site – don’t irritate your potential clients. Go ahead and add a little Flash banner on your site for visual interest, but don’t buy a Flash site.

Article by Julie Bodine
Owner/Creative Director | Margarita Marketing
www.margaritamarketing.com