Playing by New Rules
It is pretty clear that the fallout from the subprime mortgage meltdown and ensuing financial crisis will impact everyone. It is hard to think of an industry that will not feel the impact of retreating consumer spending and shrinking of credit and capital needed invest in the new projects.
So, how-to maintain profitability in a volatile economy that requires more marketing innovation, and by innovation we mean doing more with less.
The 2001 recession caused by dot.com bust and Y2K excess was vastly different from current state. The rule was to refocus traditional marketing efforts to a different industry, such as financials, government or healthcare where the growth was robust. Target the expanding Asian markets such as India, China and Taiwan, etc. Coupled it with a reduction or redistribution of workforce to growing regions with cheaper and eager workforce and get high levels of profitability and growth.
However, these approaches will not work during this economic downturn. Emerging markets are in a retreat and their new consumers will be more affected by the downturn. The robust economic sectors are also feeling the pain and even the largest most stable customers are failing or retreating.
The Rules
“Micro-target” and look for pockets. “Micro-targeting” is similar to spreading lots of small nets in the wide ocean. Internet is perfect tool for “micro-targeting” because it delivers fast, cost-effective manner and reach your target and you get immediate feedback.
Dialup intimacy levels with your customer. Yes, intimacy levels. This is an extension to the get to know your customer rule. To effectively “micro-target”, you need to know more about customer’s motivations, fear, goals, and problems. Invest in creating profiles or personas that bring customers to life.
Shift more of the marketing strategy and dollars to the Internet. In the past 3-5 years, Internet marketing came of age, while traditional media channels are in decline. The doubters need to look at successful Obama campaign and then look at the penny-stock of traditional newspaper media and then decide where to put your marketing dollars.
Spend the time and put in place benchmarks, metrics and performance dashboards. Internet, like no other marketing channel generates a lot of immediate real-time data. But according to a recent McKinsey survey , is surprising how many companies don’t have any kind of measures to track their success. Quantitative metrics enable fine-tuning and optimization of results allowing to that allow you to track your success.