Take Steps to Shine
There is a maxim in marketing that it costs much more to cultivate new business than to retain an existing customer. More than ever, in this economy, this has proven to be true.
When business slows, our first instinct is to seek new business to replace the customers we’ve lost. But put yourself in the consumer’s shoes. If your business model has remained the same, competing businesses haven’t made any major changes and the market pricing structure has held steady, then business is drying up for some other reason. And in this case, it is the economy. So the same fiscal conditions that have impacted your current client base will have the same effect on those you target as “new business.” Really, will you be any more successful with finding new business than you were at retaining steady business? Probably not.
This year’s economic downturn had a significant impact on every level of business in the country, and the landscaping industry was not immune. But previous economic dips have not had much of an effect on the landscaping industry, as the common wisdom was that customers in the higher income brackets are not usually as affected by financial slumps as most of the middle class. In short: Big spenders don’t usually stop spending. In summer 2008, the game changed.
But the severity of the downturn wasn’t surprising. This recession didn’t really sneak up on anyone. The retail industry, as a whole, had been fighting sagging sales for the past 18 months. The cost of living for the average American began a steady climb as gas, food and utilities prices shot up almost overnight. Market analysts finally agreed that we were in a recession, one from which it would take years to recover.
What surprised us was how quickly the landscape jobs disappeared. Last May found us with more work than any other month in the history of our landscaping division. But the phone calls requesting consultations were beginning to ebb with the onset of summer, and by July, the seasonal slump coupled with nationwide financial anxiety took its toll on business. Fortunately, because our retail division had already begun to feel the effects of a slowdown, we were aware that landscaping wouldn’t be far behind. So we had time to be proactive.
Once sales calls started to taper off, we knew that reaction time was crucial. Our plan began with the first obvious step of carefully managing labor hours and other logistic efficiencies. The next logical step was to re-examine our marketing efforts up to that point and determine how to adapt while still moving forward, starting with our advertising.
Stay in the Game
We buy print advertising in local newspapers and magazines, as do many landscaping companies in our area. And when cash flow slows and operating expenses need to be trimmed, advertising is often one of the first things business owners cut. After all, intangible components seem to be the most expendable. But in times like these, it is imperative to keep your name out there. Change your message maybe even change the medium but don’t change your business’ presence in the public eye. And as other businesses pull back on their advertising, yours will stand out even more.
Target Your Message
The most important aspect of advertising is to tailor your message to your demographic target. This is where most businesses falter. They create generic ads in a blanket appeal to everyone, rather than targeting specific customers based on age and socioeconomic ranges. Don’t cut your advertising; streamline it. A media sales representative will attempt to present their publication as the perfect outlet for your message, but don’t take their word for it. Instead, do your homework to weed out the publications that won’t realistically work for your business. Who are their readers?
How old are they? Do they own their homes? How much discretionary income do they have? All of these are fair questions to ask as they apply to your targeted message.
Realize that price is going to be a big consideration for your customers in an economy like this, so solely image-based advertising will be relatively ineffective. Aggressive offers and pricing will separate your company from others that offer the same services.
Casting a wide marketing net is rarely productive or cost-effective. Although targeted marketing will take a certain amount of self-examination as a company to identify your strengths and weaknesses, you will eventually see maximum gains with minimal costs.
Plan for the Future
Few landscaping firms have been around long enough to have experienced an economy like this one. And when the dust settles, only those who embraced change will be left standing. Efficiency is key in labor management, scheduling, advertising: Every dollar counts right now. A critical analysis of your operation also brings great opportunity for financial streamlining. The strategies that you develop now are essentially new business plans that will guide your company through these challenging times. Don’t look at this process as merely crisis management. These strategies should become the operating tenets that keep your business running sleek and lean during even the best of times.
SIDEBAR
Think Outside the Ad
Sometimes, it pays to change up your approach a bit. Here’s a look at two ways you might consider when considering diverting your marketing budget in other directions.
Direct mail. This can be effective, but the per-unit cost is also somewhat expensive. However, if you maintain your own client list, you can target your best customers with a limited mailing. Obviously, the total cost will be lower, but you also will reach an established client base that is familiar with your company the low-hanging fruit, so to speak.
E-mail blasts. This can be a perfect way to reach potential customers. But simply sending an e-mail won’t get you the sale you still need a call to action to grab their attention. Standing out in a sea of ubiquitous messages is critical. But resist overwhelming your customers by sending too many e-mails too often. Messages sent more than every week or two will likely be overlooked and may even result in unsubscribes.
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