5 marketing mistakes people make in tough times

Posted by Jeremy L. Knauff | September 1st, 2009

marketing mistakes When it comes to marketing, mistakes can be expensive. It’s not just the money wasted on a failed campaign that you have to consider though, it’s also the opportunity lost because the money that you spent now can not be used elsewhere. That means you’ll have to work harder than before just to achieve the same profit margin AND you’ve reduced your ability to market your company.

I’ve made my share of mistakes in life and I am certain that I will continue doing so until the day I die, but that’s fine with me because that’s how people learn. I know I’ll never live long enough to make every mistake by myself, so I prefer to learn from other peoples’ mistakes. I’ve found that it saves a lot of time and frustration. That being said, countless entrepreneurs before you have faced tough times, and in their attempts to keep the lifeblood of their companies flowing, most of them have ended up making the same marketing mistakes. Fortunately, instead of following in their footsteps, you can save your self some time and frustration by learning from those who have come before you.

Reducing or eliminating their marketing efforts

Just because your revenue may be lower than usual, you don’t have to take the bean-counter’s approach and reduce or eliminate your marketing efforts. That would have the exact opposite effect you’re looking for. Instead, be more selective in your marketing efforts. Do you really need to run the $9,000 magazine ad each month, or could you get the same results with an ad in few smaller publications? You could also get creative and work out a deal with your marketing vendors. After all, when the economy slows down, everyone feels it and they may be willing to offer a bit of flexibility that they wouldn’t ordinarily consider.

Reducing or eliminating sales staff

This is a simple equation: More people in the field selling your product or service = more revenue. If your sales staff is commission based (and they should be) there is no cost to you unless they sell something. This means that your profit margins will be a little lower, but it also means that you can focus more energy on running your business. More importantly, it’s scalable. If are the sole rainmaker in your company, you’ll generally have to work at least twice as long to sell twice as much, but if you have a sales staff, increasing sales is a simple matter of hiring additional sales personnel. The key here is to make sure that they have the tools they need to do their job effectively.

Accepting every client that knocks on their door

It may seem counter-intuitive, but sometimes you need to turn potential clients down. More often than not, you probably know when a client is going to be more trouble than they’re worth. Trust your gut and save yourself the headaches. If they come to you complaining about how horrible all of their previous vendor experiences have been and how no one could ever get anything right, that should be a huge red flag for you. Any profit you would have made will quickly be eliminated trying (unsuccessfully) to keep this client happy. The same applies to clients that that are too large or too small for your company. You need to choose clients you can effectively work with and that fit your business model. If your construction company represents strong family values, no matter how good the money may be, you really should pass on building the next strip club in your city.

Trying to be all things to all people

When people aren’t generating enough money from their core business, one of the first things they try to do is diversify their business model. Lately, I’ve seen more than a few IT firms lately that have resorted to this, attempting to offer IT services as well as web design and hosting, home theater and alarm systems, cellular services and more. It confuses your prospects and lowers the perceived value of your brand. Focus on what you’re good at and let your competitors try to do everything. You’ll be far more efficient, effective and profitable while they run all over town chasing their tail.

Offering arbitrary discounts

There’s nothing wrong with negotiating to create a win-win situation, but simply offering discounts in the hopes that it will motivate a potential client is always a bad idea. If you start off asking $2,000 for a product, but then offer to accept $1,000, you’ll leave your prospect doubting that your product really was worth $2,000 in the first place. If your prospect doesn’t have the budget for what they want, you could offer a similar product with fewer features instead. Offering a discount can be effective in tough times, but in order for it to work, it has to be a matter of give and take otherwise you risk damaging your company’s image.

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1 Comment »

One Response to “5 marketing mistakes people make in tough times”

Cynthia
September 8th, 2009 at 5:56 pm
Great advice! I find that in this economy, businesses forget that marketing is their investment in their business, not a cost. In regards to social media, (which is my specialty) it is so inexpensive and a great way to connect with your customers in tough times. If you can connect with customers now, when things get better, they will remember you!