Making the Best of the Economic Downturn - Part 1 - Leverage the Change

We've just finished a series of posts on the green wave.  But even as I was writing them, the green wave was colliding with another mighty wave, the current economic crash.

What does the economic downturn mean for green marketers?  There are two parts to the answer, because of the split personality of these curious professionals.  Green marketers are green marketers,  and also green marketers.  And yet they are always both at once — they must market green.  But economy impacts the two halves differently.

So let's first see how the current economic climate affects us as marketers.  Here, we're in the same boat with all other marketers at this moment in history.  Then we'll explore the difference that green makes in our situation.  (It's big.)

So... we know which way the economic winds are blowing.  They're blowing down — although we don't yet know how far.  The question is, how should your business respond?

The first thing to remember is that the winds are blowing down for almost everyone — your company, your customers and also your competitors.  You are not the target — the change is across the board.  So you need to respond proactively to outmaneuver your competitors in winning customers during this economic downturn.

From that standpoint, at least, the downturn is not bad news.  It's not good news, either.  It's just a change.  And as business guru Peter Drucker once said, the job of business leaders is to "exploit change" — that is, to leverage it to your advantage.  So rather than thinking of this as "bad times" during which you need to tighten your belt, look at it as a market change to leverage competitively with the resources you have available.

How do you leverage an economic downturn?  Respond to the total situation.  The cash & credit crunch is only part of it.  More important is how your marketplace will change in response.   So begin by asking, "How will my customers respond?  How will my competitors respond?"  Then you can craft your own response to leverage their responses.

Your customers — and, if you're selling B2B, their customers — will likely be cutting back.  But they still have needs.  In some cases, they'll be putting off the fulfillment of those needs, or cutting down on quantity, and there may be nothing you can do about that (although lower-priced models and extended payment plans can help).

In other cases, customers will still make purchases to fulfill their needs, but they'll tend to do it more selectively.  Or more accurately, they'll shift their selection criteria.  They may downgrade their quality standards in favor of lower price, for instance, and shift from a focus on long-term value to immediate cost.  And their values will shift away from luxury or "frills" towards practicality, the basics.

All of this may indeed shrink your market for the time being, and there may be nothing to be done about it, other than retooling your products and prices towards the downscaled values of the marketplace.  But if you stop there, you've left out the most important part of the picture.

What's that?  See our next post.

Keith Borden, Consultant
Brilliant Green Marketing