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Friday, Oct. 10, 2008 at 5:18 am

Online Marketers Can Weather the Financial Crisis

By Bryan Eisenberg
October 10th, 2008

The financial crisis is here. It’s not a matter of if it will affect you and your company, only a matter of when and how much. Clients and friends are checking in with varying reports, some are watching their growth plateau, others are watching sales trend downward.

Overall, conversion rates are starting to trend downward.

Almost everyone I speak with is looking for areas to cut expenses in and approaching spending from a more frugal mindset. Some are beginning to make drastic cuts, including personnel. While I’m not a financial expert, I can safely predict that this financial mess will likely get worse before it turns around. This isn’t another dot.com bust but a larger crisis that will leave few untouched.

So what does this mean to you, your company, and your conversion rate? Can you come out of the other end of this with little to no damage? Anyone who has been in business through a recession knows it’s absolutely possible to survive and, sometimes, even grow a bit (or a lot as competitors fold under pressure).

They will also tell you that it’s never easy.

For online marketers wishing to thrive, a down economy brings two big-picture lessons. First, now is the not the time to stop being innovative. Second, efficiencies are not an option.

Innovate Your Way Through

In a good economy, the rising tide lifts all boats. In a down economy, you’ll quickly know how good you really are. And let’s face it, we could all get a little better, right?

Conversion optimization basics may no longer be working or working less well. You must innovate your way through.

For example, I was recently asked in an interview about creative use of personas. The interviewer and I were talking about a retailer who was worrying about cutting inventory on hand. I was asked if the retailer could use marketing personas to help people buy more effectively or target more profitable buyers. The answer is absolutely yes.

Creative merchandising, creative buying, creative offers, creative marketing, creative cost-cutting, and creative customer-relationship-building will make a difference between who thrives and who dives.

When I say “create” or “innovate,” I’m not talking about a crazy sock puppet ad or simply redesigning a logo. Instead, I’m talking about offering customers more perceived value at less cost to them and you. I’m talking about finding innovative ways to cut through the clutter of our media-crazy environment and the pain people are feeling from this crisis by increasing message relevance and spending less. True innovation always stretches those limits. And that involves much more than screaming louder, telling a funnier joke, or changing the color of the “buy now” button.

Work harder and more creatively at answering the question: what can we do for our customers today? There are only two things riskier than being innovative: being gimmicky and doing nothing. Neither is acceptable.

Offer your customers something better — or your competitor will.

Bow to the Throne of Efficiencies

The more you master the craft of doing more for less, the more secure you’ll be in the coming months. Don’t try to do three jobs with one person until that person begs for mercy. Instead, make marketing dollars go much, much further. That includes cutting fat from marketing budgets and creating a culture of marketing optimization that leaves no penny unturned. It takes work, but it will bulletproof you internally with the bosses and externally with the customers.

Your customers are already acting more efficiently. You should, too. Recently I noticed a pattern in the top 10 retailers by conversion rate. Last month three big florists made the list, but FTD.com fell off the list. More important, The Children’s Place made the list in September, but not in August during the back-to-school shopping season. That raises the question: is this a sign of early holiday shopping? Could this be a sign that people are looking for a better value by shopping earlier and earlier?

You must start optimizing now.

Need help? Refer to my latest book, “Always Be Testing.” There are reasons why I chose to write a book about Google Website Optimizer, even though there are other, more sophisticated tools. And for many looking for efficiency in marketing, Google Website Optimizer is the right price — free to get started with. This is a first step your company can take to get focused on continuous improvement.

A Few Tips for Rocky Times

Finally, a few tips as we head into the storm:

  • People will still buy what the need and want; they’ll just buy slower and more methodically. Expect longer sales and lead-generation cycles. Customers won’t ask you for more value, they’ll just search for it elsewhere.
  • Don’t be shocked by changing patterns in your metrics. Your customers may behave differently based on newfound attitudes. Ask why they are doing what they are doing. Use personas to find ways to persuade them and calm their fears. Test to find the answers.
  • Don’t cut back on optimization.
  • Consider visiting or revisiting price-point- and shipping-cost-related offers. They are at least worth a test or two.
  • Stay focused on your customer first, not on the market.
  • Even though you can, don’t blame the economy. It likely won’t hear you, and if it does, it won’t do anything about it.
  • Don’t think you’re immune. I don’t want to see you in the ash heap.

Is the economy affecting you yet? How? Let me know.

* cross posted from ClickZ

Editors Note: You can also download our white paper titled Grabbing Market Share: Marketing in a Recession.

Add Your Comments

Comments (16)

  1. Bryan, 10 words towards the bottom of your post should be the mission statement for all modern marketers … online or otherwise.

    “Stay focused on your customer first, not on the market.”

    With the correct focus, a proper plan, executed properly – Today’s marketers should be able to chart their own course through this storm.

  2. It is scary out there right now but I’m with Dan, you gotta start planning now and follow through. IF we could make it through all the other storms, New Orleans has proven to me that we can make it through anything so hang in there. Great post by the way!!! I look forward to reading more and more.

  3. This is the time where you go back to the drawing boarding and really take a look at your overall situation. Shaving costs I think will be at an all time high for many companies.

  4. I didn’t have time to look at the details, but here’s an extremely interesting piece of information.

    Look up Google for the keywords “founded” “1929″ and “USA” and guess how many responses you get?

    12,900,000!

    Of course, that’s just a rough Google search, but you’ll find that tens of thousands of businesses were formed at the peak of the Great Depression. And many of them exist today, and thrive today.

    Yes things will get rough.
    But hey, the proof of the pudding is in the history.

    Do the right stuff, and the storm will eventually pass.

    Sean
    http://www.psychotactics.com

  5. I’m a copywriter for the natural health market and I’ve been giving a lot of thought to what is going to keep customers purchasing even when their wallets are shrinking:

    1. new positioning – place your product in the light of necessity and characterize it as smart move for the future. The methodical persona – looking carefully for the longterm benefits – is taking over.

    2. emphasize value. While you may need to have sales and price test, don’t short shrift the value of your product. Find SPECIFIC ways to convey to your prospects that your product is worth their precious money.

    3. emphasize relationships. People are conservative and are less willing to try new things and companies. Put much of your marketing dollars into keeping your old customers returning to you. Build your relationship with them through valuable content and communication.

    I’m looking forward to hearing more about what people are doing strategically to make transform this challenge into an opportunity to distinguish their business and even grow.

    Thank you Sean for that interesting google insight.

    Sarah
    http://www.healthwriterclachar.com

  6. Wallets do shrink, but it’s also interesting to note that some businesses don’t do less business (or earn less profits). In good times, people buy anything. In bad times, people buy good things. It’s a matter of getting your stuff to be consistently good. In good times or bad.

    Did I overdo the word ‘good?’ :)

  7. I think as you said this is time when we can sit and decide how we should react to this crisis. One idea is as you said, work on better conversion and offer more perceived value to visitors to your website. Also another thing we can do is find out ways using which we can drive more traffic to website. For example there are always some keywords which we are not targeting. We can include those and work on them to get more traffic in coming months.

  8. Bryan, it’s interesting the while forecasts are being revised downward, there’s still serious growth expected in online marketing while overall marketing stays static or decreases. It seems like the opportunity is shifting even more strongly to online.

    That said, while the opportunity exists, my experience is that clients will even more risk averse than usual (which is a lot). It’s time for a lot of handholding and explaining from us online folk.

  9. This is excellent advice. I felt more like a shrink than a marketer over the last month with clients…everyone wants to cut costs, but I always say you are in business to stay in business for the long haul. If you cut too much you risk your long term growth in your market…anyway this is my 2 cents :o )

  10. [...] be make-or-break for a lot of eTailers.  So, like Bryan Eisenberg mentioned in a recent blog, the time to innovate is now, and relying on the status-quo isn’t [...]

  11. [...] Online Marketers Can Weather the Financial Crisis – Grokdotcom [...]

  12. Great advice!

  13. I especially liked the optimization tips.
    Don
    http://www.gamebay.com

  14. I keep finding more online based companies that are thriving rather than having a hardship in this economy. Being an online company, I appreciate that.

  15. During the financial crisis, people are getting smarter on how to spend their moneys on quality products/services.

  16. Bryan nice article there on financial crisis.It scared the hell out of me but the truth is truth.And been passing through it shows the importance of your words.

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Bryan Eisenberg, founder of FutureNow, is a professional marketing speaker and the co-author of New York Times and Wall Street Journal bestselling books Call to Action and Waiting For Your Cat to Bark and Always Be Testing. You can friend him on Facebook or Twitter.

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