Finding opportunity in a business crisis
Disney. Airbnb. FedEx. HP. IBM. What do these businesses all have in common? Aside from their iconic status, each of these companies were formed during a crisis. In a recession, to be exact. In this article, we’ll set out a plan of attack for businesses in crisis mode. We’ll also show you how compelling copywriting can grow your business.
These global powerhouses took advantage of weak and uncertain economic conditions. They honed their strategies, forged connections, and built relationships with their customers during bad times. More than that, companies like Airbnb took advantage of customers priced out of the hotel market during the 2007-8 financial crisis. Today, Airbnb is worth upwards of £30bn.
Currently and around the world, major and developing economies have plunged deep into the throes of a recession. And there’s no end in sight. Business owners, managers and leaders ought not to despair, however. With surgical-level planning and the benefit of foresight, your business can continue to deliver on its objectives and targets.
A close examination of the impact of recession on business reveals a pattern. These patterns materialise in the form of consumer behavior and a firm’s strategies. These two elements are related, and one could argue, intimately so.
Interviews with small business owners in the US reveal that business owners are doing whatever it takes to get by. Plenty of businesses were granted access to fast and easy cash (many of which are unlikely to ever be paid back). Moreover, plenty of brick-and-mortar businesses struggled to get their business online (think online stores). The consequences of failing to think ahead and plan for a digital e-commerce landscape has put many businesses out of commission for the foreseeable future.
And for what? Well, we argue that with the benefit of strategic planning, many of these pitfalls ought to have been avoided. It is imperative for your business to consistently think ahead and anticipate any disruption to operations and ability to execute flawlessly under most circumstances.
Recession Psychology
During a crisis, it is crucial for your business to take a closer look at customer consumption behavior. According to Harvard Business Review, during recessions, consumers set strict priorities and adjust their spending habits. In response to falling revenues, businesses often make the mistake of cutting costs. Inherently, cutting costs without offering prior consideration to the drivers impacting consumer behavior, is a flawed decision.
Rather, and as opposed to cutting costs, businesses should adjust strategies, tactics and product or service offerings in response to a change in demand. Embark on the worthy exercise of customer segmentation. For example, and as a first step, identify where most of your customers fall on the following scale:
- Hardest hit: This group will halt all but essential spending (think food, shelter)
- Just getting by: During a recession, it is likely that the majority of consumers will fall into this bucket. They may choose to reallocate spending to more essential items and forego other expenditures (think eat in, a form of essential spending), and avoid eating out (a luxury)
- The 1%: This elite group is the most likely to continue living through a recession with minimal financial concern. Armed with well-padded bank accounts to last a recession and beyond, decision-making regarding expenditure and spending is unchanged (relative to the rest of the group).
- Living for today: Harvard Business Review refers to this group as those consumers who are unlikely to change their spending habits unless they find themselves unemployed in the process. Moreover, this group is least likely to worry about savings, and will likely live through the recession. It’s just another day, after all. Spend on, they will say.
With a clear sense of where your customers are most likely to fall, you’ll likely also have gained some insight into their psychology. Is your customer living in fear of scraping just enough to pay rent this month? Or are they on a flight to Cannes where they’ll spend the next two weeks basking in the sun, sipping $60 bottles of wine? Regardless of the customers you currently serve, the insight from such an exercise will help you make your next strategic move.
Plan of Action
Armed with information about your customer’s psyche, you’re ready to cater and adapt your business strategy accordingly. This may be different depending on your business, including your existing service/product offerings and other factors. But the process is rather intuitive. The hardest part may be confined to the customer segmentation exercise.
Here are some tangible business strategies:
Focus on your loyal customers
In times of hardship, customers will look for comfort in every corner. This includes seeking out the comfort from reliable, trustworthy businesses they have purchased from in the past. The last thing you want as a business during this time is loyal customers who switch to another brand.
Cater to your customer
In response to a crisis, businesses will cut costs. More often than not, it’s spending on research, advertising and other non-critical activities that get chopped first. However, it’s important to keep open lines of communication with your customer. If this means remaining top of mind via targeted Internet ads, then please do keep money flowing through this channel because cutting advertising costs may just mean putting up a wall between your business and your customer.
Show some empathy (as a business)
In uncertain times, human beings are naturally inclined to succumb to feelings of fear, anxiety, depression. What’s more, they’re more likely to demonstrate a general tendency towards substance abuse. Use your social media channels, blog articles, and touchpoints with each customer to simply check in and ask how your customer is getting by. It’ll show the human side of your business and demonstrate your commitment to your customer’s wellbeing.
Your copywriting roadmap in times of crisis
Copywriting in times of crisis is no different than copywriting in good times. At its root, the art of copywriting is composed of one human being writing to another, in an attempt to communicate a worthy message that results in a desired form of action.
The best copywriters are trained (or at least self-taught) in the principles and motivations that underlie human behavior. More than that, disciplined copywriters take the time to feed an inherent curiosity that drives thoughtful, authentic and meaningful copy. Naturally, this implies that the copywriter maintains her finger on the pulse of the crisis at all times. She is tuned into what the hardest-hit consumers are feeling, and where they feel the pain most. Furthermore, the astute and well-trained copywriter will have the audacity to write in inconspicuous terms that resonate with his audience. In times of crisis, your copywriting roadmap must demonstrate humanity, while communicating value.
Invest in great copywriting
All good things must come to an end. This applies to the good times and bad. One day, when this crisis is behind us, your business will rise a stronger version of itself. Mistakes will be made, write-downs may be inevitable but a failure to make agile changes to your business strategy, including your copywriting strategy, will remain unforgivable.
Looking for determined, driven copywriters? Get in touch with us today using the form below and let’s start rolling out some remarkable copy for your website and online presence.
