Whether you call it an uncertain economy, a down economy, or a recession, one thing is definite: buyer behavior is quite a bit different from what it was a year ago. Both consumers and businesses are more cautious about how much they're spending and what they're spending on. They're no longer making luxury purchases and are scrutinizing every cost, as well as demanding a faster ROI.
But small- and medium-sized businesses (SMBs) have an advantage over large enterprise counterparts in the current scenario. They are nimble enough to switch gears to market and sell more effectively—adapting quickly to this new buyer behavior—and come out ahead in this economy.
One proven strategy is to focus on customers: retain the ones you have, build stronger relationships with them, protect them from your competitors, and provide them with more value than ever. This will enable SMBs to increase wallet share from these customers, rather than the more expensive proposition of chasing new prospects. New prospects are even more hesitant to buy from new suppliers in this economy; they tend to mitigate risk with smaller purchases and by sticking to what they know.
A solid plan for all customer-facing departments, enabled with the help of a CRM system, can quickly help a company shift gears to focus on their customers to succeed through the economic downturn. Start with improving processes to make customers happier—solve their problems faster, mitigate their risk, and show them greater empathy.
Then look at your marketing budget and resources to determine whether and how much of your budget you want to shift from new customer acquisition to customer marketing initiatives. Identify your most profitable customer segments and plan your customer marketing initiatives around messages that will better resonate in this economy (e.g., greater flexibility, mitigated risk, greater value and ROI).
Make customers happier: a different approach in this economy. Don't let disjointed departments and processes get in the way of creating happier customers. Often times, SMBs' customer service departments lack process and systems in which to resolve, collaborate on, and mandate deadlines for resolving customer issues.
If your sales department is using a CRM system, investigate whether the system has customer service management capabilities—most do. With a CRM system offering sales and service modules, SMBs can design processes enabling easy transition of customers between departments, and insight for salespeople into outstanding customer service cases.
Typically, a salesperson isn't skilled (or compensated) to fix a customer's problems, nor are customer service staff trained to sell. CRM systems enable follow-up tasks and pop-up alerts to be easily assigned to appropriate personnel, whether they are working inside the office or out in the field.
Moreover, now is a great time to be proactive about managing customers. Instead of waiting for them to call when there's a problem, reach out to them—whether it's through account managers in sales, customer service staff, or both—and find out how they are using your product and whether there are any underlying concerns.
You may find customers had nagging problems people grumbled about, but no one had picked up the phone to formally address with you. This is an opportunity to anticipate problems and help resolve them before they become too large. And before they talk to your competitors.
Develop new target messages and identify profitable customer segments. Your marketing messages and sales tactics from a year ago will likely not work today. As such, after reviewing how much of your budget to shift toward customer marketing, the next step is to develop new target messages and identify profitable customer segments.
SMBs should gather the marketing, service/support, and sales management teams to identify customers' concerns and discuss how their product or service addresses those concerns in a different way now. For example:
• What are the risks that concern customers? Offer something to mitigate those concerns, such as better guarantees or value-add services.
• How are their businesses doing in this economy? Identify how your product actually helps them weather the economy.
• Do they want to buy in smaller increments or are they having problems accessing credit? Offer pilot programs with phased purchasing, or help with financing solutions.
• Are they concerned with the value they have derived from your product in the past? Design programs to show them how to leverage more value from what they currently have, and identify which additional products can enhance their experience.
Then, utilize CRM software to help segment customers in unique ways by looking at industry, techno graphics, brand loyalty, purchase behavior, and more. For example, in a retail or manufacturing environment, "prosumers" (highly sophisticated consumers) appreciate the chance for interaction with manufacturers, providers, and retailers. They are often a very profitable customer segment that will spend more and are less price-sensitive.
Identifying profitable segments and targeting them with unique messages and offers will increase revenue. This will also build long-term, successful relationships.
Not just to survive, but also to thrive in this economy, SMBs have an advantage over large enterprises in being able to quickly adapt to new strategies. Ultimately, those that devise new ways to retain existing customers, as well as create targeted messages and programs that resonate in the current climate, will come out ahead.
Angie Hirata is worldwide director of marketing and business development for Maximizer Software.