by Don K. Crowther
America has changed how we go to war.
It used to be that war information was parceled out in small doses.
But with the advent of CNN, Internet coverage, embedded reporters,
and wall-to-wall (24-hour) coverage by all of the networks, war has
become a consuming factor in the lives of many Americans.
Once the war in Iraq starts (or natural disasters happen, terrorists
attack, or other major news stories occur), many people will use much
of their free time (and often part of their work time) glued to the
media, where they become emotionally involved as the events unfold.
This affects us, as businesspeople, in many ways.
Most importantly, sales will most likely drop. Some of this is
through consumers not having time to shop, some through a reluctance
by both consumers and businesses to commit themselves in time of
uncertainty, and some through our inability to generate enthusiasm to
purchase when potential buyers' minds and emotions are focused
elsewhere.
So how do we, as businesspeople, do business in time of war?
Here are some strategies that we at WinningAtBusiness.com recommend
to maintain and even build sales in time of war and other disasters:
1. Be opportunistic with the media in your public relations
efforts.
For the first part of the war, television news coverage will probably
be impossible to gain, as 80-90% of news time will be devoted to the
war, so it will be very difficult to get hard news coverage for
anything.
This will cause many people who would normally be pitching stories to
the press to shelve their publicity efforts until after the war is
over.
But don't forget that every major newspaper and magazine in the
country has many other sections to fill, like food, auto, fashion,
lifestyle, seniors, sports, business, entertainment, etc. that
probably won't be covering the war. Plus, every radio station,
especially the talk channels, will need to fill blocks of time with
non-war coverage.
Some stories will have additional interest in times of war, including
stress relief, anti-terrorism projects, building love and unity
within families, counseling, finance and debt management,
communicating with friends and loved ones who are away from home,
creating bomb-proof investment portfolios, insurance, how to explain
war and death to children, etc.
This combination of lack of stories being pitched and continuing
demand from reporters gives you a great opportunity to get a story
run that you probably couldn't obtain otherwise.
2. Be opportunistic in purchasing advertising.
The Gulf War taught advertisers that it wasn't a good thing to have
their ads run right after pictures of smoldering tanks and dead
bodies. Consequently, most major advertisers have a blackout plan in
place that cancels ads when the shooting starts.
This leaves you an opportunity open to pick up advertising at an
inexpensive rate. We don't recommend running your ad during war
coverage (especially if it turns bad). But there will be an
opportunity, during the first day or two of the war, when media ad
salespeople will be deluged with calls to cancel advertising. If you
would place calls at that same time, to actually buy advertising
space, you're liable to be able to negotiate some great deals for
advertising to be run after the war.
3. Visibly support the troops.
Vietnam taught us a principle that now resonates deeply within the
heart of many Americans -- that no matter your personal feelings
about the politics behind the war, the troops need the support of
those at home. Recent poll numbers confirm this, indicating that
public sentiment has turned towards supporting the troops.
For example, WTMJ in Milwaukee, Wisconsin, created an online petition
supporting the troops in the field. Not only did it garner 48,173
signatures, but it also generated huge goodwill for them in the
Milwaukee market in the process.
What can you do to support the troops and to help rally the goodwill
of others?
4. Publicize your connection with the war.
If you have viable, real connections with the war, you may, want to
publicize those connections (depending on the support you see for the
war among your customers.) The place where this is most likely to
succeed is with the local media, especially local television news
stations who are looking for stories that localize the war effort.
Story opportunities range from having 10% of your staff on
deployment, to having a government contract to supply something for
the war effort, to how you're managing your small business when the
boss is deployed, to the campaign to support the troops that you
started in point 3 above, to one of the parts you manufacture being
used on the troop transport vehicles. Of course, all of us have seen
the publicity generated by the restaurants who poured their French
Wines into the gutter, or renamed their French Fries as Freedom
Fries, but unless you're first, you won't get the benefit of the
publicity from these types of actions.
Be very cautious with this strategy though, to ensure that it doesn't
backfire on you. It needs to be a real connection with the war, not
just a way to manipulate people into buying your products. Some will
create their own problems like a restaurant promoting their delivery
service as a great way to be able to stay home and watch the war, and
the sale of American flags and genuine Iraqi desert sand.
What crosses the line? Try the smell test v does it smell like a
promotion? Giving a week's worth of profits to the International Red
Cross to support feeding Iraqi citizens during and after the war will
work, but promoting your product as the official hamburger of the Los
Angeles Coalition to Oust Saddam Hussein won't. Support works,
blatant promotion doesn't.
But no matter how hard you promote your business, it's virtually
inevitable that your phones are going to stop ringing, customer
traffic will whither, sales will decrease and your people will have
time on their hands.
Unfortunately, the natural inclination in times like these is to run
huge sales, cutting prices to buy more business.
We don't recommend doing this. Remember that your customer's
attention is focused elsewhere, not on running out to support your
huge sale. So, you'll pay lots of extra money to promote your sale,
and the sales that result will be less profitable. The net result v
an unprofitable sale!
Our recommendation? Instead of sweating trying to pull in more
customers, spend this time doing those things that will build your
business in the long term v those things that never seem to get done
because of the pressures of day-to-day business from your customers.
Analysis, planning, customer service and training are all potential
tools.
Possibilities include:
1. Analyze your customer base.
Who are your customers? Where are they from (plotting them on a map
is oftentimes helpful.) What do they have in common? What
businesses are they in?
But analysis does no good without application v how can you reach
more people who are like your current customers? Create a plan to do
so, with specific action steps to reach and convince them to try your
products and services.
2. Analyze the profitability of your current customer base.
If you're like most companies, a small portion of your current
customers deliver the bulk of your profits, and most of the time,
your biggest customers are not your most profitable ones. Create two
lists, one ranking customers by net sales, and the other by net
profits. Then look at the differences and why they exist. Is it
what they buy? Is it because they're a house account so you don't
have to pay a sales commission? Is it how they buy, requiring less
of your staff's time?
Next, look at your least profitable customers. What do they have in
common? Is it possible to move them into profitability? How would
you do that? Or, are they hopeless, and should just be fired? We
make it a practice to fire 10% of our client base every year. Some
we fire because they're not profitable, others we fire because
they're a royal pain to deal with. And it's amazing, every time we
do this, another better company shows up to fill the vacuum, and
business becomes easier and more pleasant.
Application: Create an action plan to make each of your customer's
more profitable. Consider especially the changes you can make to
your product line, promotion materials and customer base to make that
conversion.
3. Analyze your product mix.
It seems counter-intuitive, but one of the best ways that you can
build your profitability is to get rid of products that don't
generate significant levels of sales. Remember that inventory, shelf
space and working capital costs dollars, money that can be better
spent in acquiring more profitable products or promoting the product
line that you currently have.
Application: Rank your product/service line by sales volume. Then
cut the bottom 5-10%. If you sell goods, return them to the
manufacturer, or put them on clearance. If you sell services, remove
them from your web site and other promotional materials.
4. Analyze your Web Site.
Business has clearly turned to the web. But most companies have
sites that are years old, that look horrible, and that aren't
equipped to help customers do business online. More importantly,
most companies sites aren't written to get good rankings on the
search engines, so they get no traffic.
Application: Do a thorough review of your site and its traffic. Make
changes to make it relevant, to ask for orders, and to get it high on
the search engines.
5. Analyze your systems.
The best businesses systematize how they do key tasks, eliminating
questions, standardizing behaviors and removing costs from the
system. Key systems to check are marketing, order processing,
accounts receivable processing, billing, job costing, and customer
follow-ups.
Application: Develop at least three new systems to handle tasks
within your organization, write system descriptions and train your
staff to use the new procedures.
6. Analyze your customer service practices.
Employees develop bad habits over time that turn customers away.
Carefully analyze your customer service norms. How long do responses
take? How empowered are your people? How do they deal with
dissatisfied customers?
Application: Develop an action list of customer service problems
that you need to resolve in your company, then get the training, do
the performance reviews, and if necessary, replace the employees who
create those problems.
7. Analyze your customer needs.
In virtually every category there are some major unmet customer
needs. You probably know what some are, but not everything.
Application: Pick up the phone or visit several major customers.
Ask them to tell you about the biggest challenges in their business,
and what they would like to see you do differently. Analyze your
customer correspondence, ask your salespeople, and look at the
industry literature for new products/services that you can offer and
ways that you can change your current products/services to meet the
unmet needs of your customers. Then create an action plan to better
meet those needs.
8. Analyze your business plan.
Are you hitting your numbers? Both sales and profits? What needs to
be done differently to ensure that your year comes in on target?
Don't blame the customer. Look at how you can better meet their
needs. The best companies flex, reforecast and revise their plans
frequently to achieve the desired objectives. Remember also, that
the most common practice of cutting marketing funds to hit profit
numbers is the last thing you should do if sales are low. Rather,
figure out how to spend them more effectively, test, revise and test
again to generate the results you need.
Application: Prepare a revised plan, including reforecast numbers,
action plans and measurements.
9. Analyze your habits.
Almost every business develops bad habits over time. Perhaps it's a
single ad that gets run over and over again, with no testing.
Perhaps it's a focus on a single trade show. Perhaps it's a total
reliance on sales reps. Perhaps it's a constant pattern of useless
meetings. Perhaps it's a reluctance to do business in a changing
world. Or maybe it's an insistence on a six-week turnaround when you
could do it in two if your systems were revised. Most of these
habits had a reason behind them at one point in time, but have never
changed through laziness or lack of analysis.
Application: Make a list of the things that constitute "the way we
do business." Then analyze it carefully. Create an action plan to
challenge and revise those habits that hurt your business.
10. Analyze the value you add.
Businesses exist because they add value that the customer either
can't or doesn't want to add. Unfortunately, the world may slowly
change to the point where the value you add is no longer worth the
cost required to obtain that value from you. Companies close every
day for this very reason.
Application: Analyze the value you add versus what the customer
really needs. Are you worth a continued position in the value
chain? How could you add more value? What would people be willing
to pay more to receive? Create an action plan to implement changes!
As you do these things, you'll find that your short-term sales and
profits decrease less than they might have otherwise and that you'll
find your business running at a higher level once the war ends v
creating more sales and profits for years to come!
Who says that war will be bad for business?
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Don K. Crowther specializes in helping businesses build their sales
and profits. For more information, contact him at
info@... or for a free subscription to his free
WinningAtBusiness newsletter, visit http://www.WinningAtBusiness.com