Down Economy = Marketing Scrutiny

Deeper understanding of customers is essential in a down economy. Ideally, marketers have been building this knowledge and segmenting customers along the way. Starting during the downturn can be a challenge when budgets are tight. Businesses with a strong balance sheet are likely to have more marketing flexibility during tough times. The impact of decreased spending and tanking consumer confidence is being felt by companies across the board. Often, none feel it more strongly than the marketers within those small businesses. Now is the time for marketers to prove their value by demonstrating the revenue-generating potential of their job. The knee-jerk response to shrinking sales is to focus on growth through customer acquisition. But you must concentrate on understanding and keeping your current customers.

Understand your customers
Marketers must look at their customers in a new light as they begin to tighten their belts. That means understanding what customers expect and what is important to them in a slowdown. Don't assume your previous customer insights hold true, as economic challenges can change consumer views dramatically. Focus research investments more on customer behavior and tracking tools and less on branding. Create and disseminate engaging and relevant messages based on a solid understanding of customers' preferences, needs and behaviors.

Concentrate on current customers
During a slowdown, it is smart to generate more value from current customers than to pursue new ones. In tough economic conditions, customers also feel vulnerable and are more likely to stay with a company than make a switch. Capitalize on the trust and goodwill that you've created with existing customers and find ways to help them navigate the slowdown. That's a strategy that will build both business and loyalty.

Analyze and segment
Customer profiling, clustering and value models are essential to identifying which customers spend the most, learning how to lift sales and detecting high-value customers showing signs of diminishing value. New behaviors are sure to emerge during a slowdown. Proactively assess and respond to them.

Knowing who to market to is often overlooked when marketers are forced to focus on just scrapping up enough resources to market to anyone. By focusing on these steps for gaining better customer understanding marketers can demonstrate their value as an asset with the potential to help any business ride out even the lowest of economic tides.