The R Word
Rather than use the euphemistic “economic downturn” is it possible that by actually typing “recession” into this blog entry there may be some search engine making tabulations of its repetition across the world wide web that then reaches a threshold causing a report to land on a famous economists desk who then declares “we are now officially in a recession because the last of the indicators has confirmed it from all sides!”
Talking about it can make it so. But if it is going to be, I would rather talk about it and get prepared. So, let’s talk.
I have been in quite a few conversations lately about recession proof this and recession proof that. Stocks, housing, customer segments, products, there seems to be no end to the list of topics that people think they have found that could be recession proof. Maybe it is something to consider, but most of us are going to be working with the situation that we have, so we might want to think about how to make it successfully through this bumpy ride. (For those of you who have specialized in serving customers who are mostly in the sub-prime mortgage industry, you probably want to seek out a different vertical).
So, I guess the question I should be asking given the nature of this site is what about your CRM program? What are you doing relative to CRM to ensure that you are going to ride this out well?
I have consulted to companies through a number of these cycles. The last time, brought on by airplanes flying into skyscrapers, caused many of my clients to want to find ways to cut costs. This is tempting. Figure out a way to keep your business going but in case the revenues drop, make sure your costs drop and keep the margin positive. I don’t know about this. Just this week I watched a segment on the evening news pitching this idea to consumers – offering all kinds of advice to cut spending. Hello! Fan those flames. Too many of those segments on the local news across the nation will cause the recession to go deeper. If we all cut costs we are going to dig a very deep abyss.
My recommendation is to take a tack that probably seems a bit counter intuitive. Build your CRM strategy to drive business development, not cost efficiencies. IBM hired extra sales people during the great depression rather than laying them off. We all need to sell ourselves out of this thing not hunker down and hope it blows over. A lot of hunkering is going to lead to a lot of recession. There, I typed it again
Go after the market with guarded confidence (as opposed to economic denial like our nation’s president). Improve your marketing reach if you don’t want to expand your salesforce. Invest in better sales effectiveness if you can’t invest in more actual headcount. Develop a new channel to expand your reach, maybe it is time to involve partners. Perhaps you need to analyze your customers to assure you are targeting the segments correctly. Going after the wrong segment with the wrong resources will become more exposed during an economic downturn. The investment in analytics will help to position your channels toward the correct segments and drive better results.
Either way, CRM can be a key to success, even if you do want to find a few places to make some efficiencies. Just don’t spend too little.