It’s still all about customers

At the end of the day, it was and always has been about customers. A business can’t survive without them. It needs ways of engaging and connecting with both existing and potential business.

Social media doesn’t change this basic business principle. Social media provides a new communication channel for customer-to-customer and business-to-customer.

Therefore, the same rules still apply…

1. Go where your customers go
All social media sites have ‘contexts’. They generally have a defined purpose; function; knowledge focus; or social context. Understand this and you’ll have your answer to whether you should be involved in any particular social media site for your business.

For example, if a social media site has a primarily American social context but you are in the UK selling to the UK market, then it won’t help you much!

Similarly, if it is a car support site and you sell gardening equipment, then that’s not a good start.

Just do a bit of research and then use your common sense.

Here is a list of over 400 social media sites to get you started. It has some categorisation but you’ll need to do a bit more work to identify those that are appropriate for your company or charity.

2. Appropriate communication
Appropriate communication will depend on many factors. It will depend on your business type; on whether it is business-to-consumer or business-to-business; and on how it is appropriate for you to relate to, and communicate with, your customers.

For example, if you tend to have a more formal business-to-business relationship with your customers, Facebook may be the wrong context; you could come across overly familiar and customers may not wish to share at that personal level with you.

However, if you sell to consumers, Facebook may be just the right communication channel. People represent themselves on Facebook (not their employer as they would in B2B) so if they care about your product or service they may well sign up to be associated with you or any groups you create.

It’s a whole new world

Social media may seem daunting at first, but the first step is to give it a go. Sign up for something and start learning. The more you do this the more natural it will become. Before you know it you’ll feel right at home!

So, how should you respond? Do you know how you can make your business stronger and more competitive and therefore better able to deal with a recession? Markets shrink in a recession so where there were lots of people wanting and willing/able to pay for your product or service before, there are now less people able to purchase what you have to offer. That means you are going to have to change your strategy to win the remaining customers and fight off your competitors.

Here are 5 steps to prepare your business for a recession…

1. Plan for the future
   Don’t just meander along hoping for the best – plan! Your business will work best if you know where you are trying to go and what you are trying to achieve in the next 3-5 years. It doesn’t have to be a long, detailed or ‘impressive’ strategy, but it does require thought!
2. Draw up an action plan on how to get there
   You will need decide on short, medium and long term actions out of the strategy you drew up. These are specific actionable things that you can start working on, starting immediately. There will be both big things that you can do to improve (break these down into manageable parts) and also lots of little things. Don’t forget to prioritise.
3. Forecast your money
   Prepare a 3-year financial forecast or get someone to do it for you (like your accountant). Add in your costs and expected benefits from the action plan above. Even with a positive economy businesses often over-estimate sales, so be careful. Try cutting your revenue in half and see what it looks like; how would respond if that actually happened? Try cutting it in half again. Keep updating it monthly so you can see where you are against your plan. This will give you early warning of when you might run into problems. If things get really tight, then move from a monthly cashflow forecast to a weekly one, and watch your money like a hawk. When you see a problem do something about it in advance – don’t just wait for it to hit you!
   
4. Spend time working on your business not in it
   In order to implement your plan you will need to starting working on your business. It’s the difference between say, restoring and renovating a house and just cleaning it. It can be hard work and uncomfortable knocking walls out, getting a plasterer in etc. but you end up with a much better house at the end of it. Don’t fall into the trap of just doing continual maintenance work when  actually there is significant change that needs to happen. Don’t get me wrong, maintenance is important but it won’t significantly push your business forward. Your business needs to be the best it can be in every area. If you don’t have time to do this, then you either need to make time or find someone to work with you to implement the action plan.
5. Don’t stop marketing, just do it better
   As things start looking tight many companies start to reduce their marketing budgets. Proceed with caution on this one. You should do a separate 12-month marketing plan that links into both your strategy and your general business action plan. You might not know how effective your current marketing actually is; measuring its effectiveness can be hard but certainly not impossible. Marketing shouldn’t just be seen as a cost – it should bring in more business in monetary terms over the year than you spend on it. It is worth noting there are no silver bullets when it comes to marketing; it is about a consistent, focused approach in line with your branding and strategy (hence the plan!). By all means, put your marketing effort under the microscope and work to make it more effective, but don’t just cut it to cut costs; there is a real danger that you’ll end up cutting yourself off from your life blood – your customers!

Though it would seem that there are difficult times ahead, don’t panic and don’t give up. Times like these can actually be a real opportunity. Whilst you might worry about what is just around the corner, the fact that you are looking at what you can do about it now puts you in a much stronger position than most. This could be your opportunity to build a stronger, more resilient organisation and to outshine and outperform your competitors.