The desire to keep your business rolling through these recessionary times has never been stronger, as the volume of business you're able to generate continues to fall while cost of operations keeps rising.
While media and economic pundits are engaged in heated debates on how to correctly label this "slowdown", your business keeps on enduring the pains of the current economic recession. Anticipating reduced revenues, many advisors have become quick to rein in spending and cut back on variable costs -- mainly marketing and publicity -- to deliver on the expectations of the financial markets.
It has been proven time and again, that slashing marketing budgets during a recession is a shortsighted decision. One that ends up confining your company to a less competitive position when the economy finally recovers. Over the years, numerous research studies have established that increasing marketing expenditure during an economic slowdown represents the most viable strategy to capture competitor market share and increase profitability, as well as gain a long-term advantage for a brand.
A recent study on the Profit Impact of Marketing Strategies compared the results achieved by companies that increased, maintained and reduced marketing expenditures during a recession. The results of the study clearly indicate that those businesses that cut marketing expenses achieved inferior results once the recession was over. On the other hand, those who increased marketing expenditures achieved significantly higher results.
There are two compelling reasons why financial advisors should continue to publicize their expertise during an economic downturn:
Share of voice - The larger your share of voice compared to your actual market share, the more likely your company and brand will grow market share when the recession fizzles out. Intensifying your publicity activities when your direct competitors are refraining from it will increase the saliency of your brand and help your company achieve a competitive edge that could be enjoyed for years.
Share of mind - Share of mind remains for months uncontested among consumers. Some of the big brands strategically increase their marketing investments during recession times to attract repeat purchase and benefit from this multiplier once the economy rebounds.
The Glass is Half Full
Traditionally, the old conventional wisdom among numerous financial advisors is that marketing and publicity efforts are wasted during an economic downturn. Constrained by budgets and circumstances, they cease to spend money during a recession, as they feel that less money is coming in.
However, it appears that not all U.S. small business owners are looking at the glass as half empty. A recent "Get Back to Business" survey conducted by Intuit, Inc. for QuickBooks, the nation's top-selling small business accounting software, revealed that nine out of 10 U.S. small business owners reported seeing opportunities for their businesses in the current recession, and more than 75 percent expect their business to grow.
The most viable course of action that you can take to recession proof your business should be to remain proactive and continue to market and publicize your services. Why? Because you'll stand out in a sea of competitors who've given in to their recession fears and curtailed all their marketing initiatives. As a consequence, your marketing efforts will become much more effective and widespread.
The March 2008 issue of Fortune Small Business magazine ran an article titled "Slump-busting Strategies," which features insights from business owners who have devised effective strategies to thrive during an economic deceleration. The piece offers an interesting quote from John Pearce II, a professor at Villanova School of Business: "Recessions are a period of opportunity; during recessions large companies abandon marginally profitable customers, and small business can get those customers."
It is important to remember that during a recession, consumers don't stop buying products and services, particularly financial advice. This is the time they need it most and seek it out. Potential clients are more likely to buy from a business they have heard of than an unknown one.
Focus on Your Communications
How can financial consultants capitalize on this opportunity and gain those customers through marketing efforts? More importantly, how can they promote themselves without having to spend a fortune in marketing communication efforts to ensure that they will effectively reach out to their key audiences?
Here are some zero-cost strategies that you can implement to recession-proof your business:
Position yourself as an expert source -- One of the most effective ways for financial advisors to successfully capture the attention of the media is to position themselves as expert sources. Reporters are in the business of keeping the public constantly informed, especially during difficult financial times. Consultants can help them do their job by taking a clear position on a topic that they feel strongly about and present it to the reporter in a positive way. By being in an article, the media acts as a third party endorsement and helps you reach a significantly larger audience of potential customers.
Submit byline articles -- When you're not busy working with clients, get busy creating content. A byline article (an article written by an expert rather than a journalist) enables you to position yourself as an expert. It allows you to demonstrate your expertise, focus on client's challenges and ability to offer proven solutions. In addition, it is a powerful marketing piece that can be mailed to current and prospective clients, posted on your Web site, or sent to existing clients as referral tool.
Comment on blogs -- This is a useful means for you to promote and receive feedback on products and/or investment ideas and spark discussion on topics upon which you are an expert. Identify popular blogs that your key audiences might read. Make it a part of your daily routine to read the updates and post thoughtful, engaging and relevant comments. This will compel other blog readers who have learned from your comments to check out your website and potentially seek your services.
Leverage the power of social media - There are two strategic benefits to adding social media to your overall marketing communication strategy: First, it is free. Second, it enables you to create a platform that attracts the attention of your key clients and prospects to your products, services, capabilities, or prompts them to share their views on a topic of common interest. Platforms like LinkedIn, Facebook and Twitter, allow you to achieve from the comfort of your office results comparable to the traditional face-to-face networking. Determine where your target markets hang out in the social networking space, and create accounts with those services.
Volunteer your expertise - Breaking financial news provides a great opportunity for you to contact the appropriate reporter at your local newspaper or trade publication. Let the journalist know that you have a newsworthy point of view and that you can offer an easy-to-understand recap of how the event will affect people and/or businesses. This will help you establish an ongoing relationship with the reporter and down the road volunteer to write a weekly or monthly column. Local newspaper and trade magazines operate with limited staff and welcome outside authors.
Create a podcast or a video - Free recording software, like Audacity, enables you to create zero-cost audio or video podcasts and post them on hosting sites such as iTune and YouTube. These audio and video clips will position you as an expert and also become a powerful referral tool when sent to clients and prospects. In addition, they can be forwarded to your local print and broadcast media outlets to solicit additional interviews. Not sure what to talk about in your video or podcast? Review articles you authored and read one of those for your audience. Don't forget to include your call to action for your listeners/viewers. (Prior to posting any video clip on YouTube, make sure you are not breaking any copyright laws.)
Send out newsworthy news releases - A news release is a one- or maximum two-page, tightly written announcement about a person, product, or service a consultant is offering and that is disseminated as a news item. Remember that this is not an advertising piece, but a tool that enables you to provide valuable and timely information/story ideas to journalists. It needs an eye-catching headline, and must convey a core news item written in plain English and in a non self-serving manner. Above all, it must answer the five W's of journalism: Who, What, When, Where and Why.
Seek speaking gigs - Do you have in your arsenal of communication tools a signature speech that you can present whenever you're asked to speak to a group? If not, this could be the most appropriate time to craft one. Once you have it, research groups and associations whose members include your target audiences, both in your geographic area and online. Reach out to the individual in charge of events and meetings and offer to speak to that group and provide him/her with a clear outline of your signature speech. Once you've secured a speaking engagement, make sure to alert your clients and prospects, as well as your local media about it, so to build additional credibility.
When economies slow down and the consumer psyche becomes anxious it is a normal reaction for marketing budgets to undergo severe cuts. However, a recession doesn't have to mean sheer gloom and doom for the savvy advisor. Recessionary cycles typically are not long lived, and are generally followed by an economic upswing.
Take advantage of this slower time and ramp up your marketing efforts by using zero-cost strategies that will enable you to become better known to your key audiences and the "top of mind" expert in your industry.
Claudio Pannunzio is a public relations consultant with more than two decades of experience working with financial services firms, advisors and consultants. He is a partner at Blue Chip Public Relations and can be reached at Claudio@bluechippr.com or (203) 532-5881.