Tips on Marketing Through a Downturn: Focus and Prioritisation
By Sanjay Nijhawan, COO, Guoman Hotels (UK)
Whilst we are living in unprecedented times there is no reason why the basic precepts of good marketing practice should suddenly be removed and replaced by knee-jerk reactions and cost-cutting. Indeed the opposite is true - never has it been more important to be faithful to your brand's promise. Now is the time to remember what makes marketing work effectively and, even more importantly in the current climate, efficiently. Maintaining your marketing activity and budget, whilst ensuring it is working as hard as possible, will be vital to negotiating your way through this recession and in ensuring you are in a strong position when we come out of it. So, here are my top tips for marketing through an economic downturn.
Prospects are not going to make you successful next year - customers will. Existing customers are up to 7 times more profitable to deal with than new customers - so there has never been a better time to identify who your best customers are and get as close to them as possible. Particularly in times of economic uncertainty and tight budgets, there is no point in trying to be all things to all people; it is ineffective and costly. Much better to reach out to customers who will be glad to work with you.
Regular communication with your key customers is vital. Understanding and addressing their issues will be key to your survival, retaining their business and preventing them being wooed by an ever more active competition. Simple steps include targeting your sales-team with regular meetings with these key accounts; develop simple communications, such as email updates, to keep them abreast of any developments or special offers; provide a senior point of contact so they feel recognised, they have a direct communication channel with your company and can speak to an individual empowered to make decisions that will help retain their business.
Differentiate your offering
In tough times it is easy to be too focused on price. Find alternative ways to compete other than solely on price. Not only will your activity be more profitable (as price reductions immediately hit the bottom line) but it will stand out against your competitors, increasing the likelihood of generating responses from your target audience.
Remember your offering is about delivering value rather than simply a low price. And being close to your customers (see above) will help you understand what really motivates them, so you can quickly identify and differentiate your offer to meet their needs. What additional benefits can you offer to loyal customers? What terms can be loosened on a temporary basis to help maintain trading and volumes? At Guoman Hotels we are developing additional benefits for specific international markets to better meet the guest needs and secure more business - for inbound travellers to London from India, simple benefits such as vegetarian breakfasts, early room availability (as flight arrivals are often during the night) and extra benefits and discounts for long-stay guests make us more attractive to this growing audience.
There is no doubt that we are facing the most challenging sales environment for decades, and these changing times are increasingly hard to predict. Therefore, we should prepare ourselves for change and expect it to happen. A good approach is to scenario plan for the best-case and worst-case scenarios - enabling you to understand potential outcomes in more detail, and prepare contingency plans for them.
Equally it is important to keep your finger on the pulse, monitoring changes and trends and taking opinions from key customers, suppliers and industry colleagues. The ability to see threats and opportunities, and to swiftly react to meet the new conditions now facing you, will be key to maintaining the effectiveness and efficiency of your marketing.
For example, the significance of the internet to marketing strategy cannot be underestimated. Over half of consumers use the Internet for business travel arrangements; two-thirds of travellers use it for leisure travel. Consumers are getting their information about us from one another, putting more trust in peer reviews than messages from our marketing departments. Whilst this development poses new challenges, it also means that there are highly cost-effective ways to communicate our message to our most important markets. There are also new and evolving channels such as email, interactive websites, blogs, podcasts, PDA's, WiFI, mobile phone technology and others. Staying abreast of these new marketing opportunities, and utilising those that provide an efficient solution, is key to maximizing your potential.
Understand the difference between effectiveness and efficiency
When budgets are tight it is important that we recognise the marketing actions that are effective and those which need to be undertaken more efficiently. 'Effectiveness' is about doing the right things, creating the most impact or effect. 'Efficiency' refers to delivering a similar outcome for less resources (time, money or both), providing either cost savings or more resources for other activity. Measuring performance, challenging existing process and constant review are key to ensuring you are doing the right things, and doing them well.
Now is the time to be reviewing marketing spend and its effectiveness - not looking to reduce it (in fact evidence from previous recessions suggests spend should be increased, or at least maintained) but to ensure it is well targeted. Going back to point one, regarding the importance of existing customers, your marketing budget should be spent reaching these key targets through efficient direct marketing. Utilise the internet, providing scaleable and measurable activity to reach your key audiences. Re-direct budgets from advertising - brand awareness still needs to be driven, but focus on cost-effective PR rather than expensive advertising. With PR, seize the opportunity to innovate - at Guoman Hotels we secured significant PR coverage for the launch of the refurbished The Royal Horseguards hotel by building on the hotel's heritage and military background, setting up close ties with the local cavalry regiment and a charity supporting injured servicemen, Help for Heroes.
Maintain a positive outlook
Although the headlines are full of doom & gloom (as the media thrive on headlines, and bad news always sells more than good) the world does go on. Business still has to do business, and customers still need to be served. Have confidence in your brand and what it delivers, and ensure that you are marketing it effectively. Previous evidence shows that businesses that market their way through recessions come out stronger on the other side, so ensure that your brand is one of them.
Consider that both the Empire State Building and the Golden Gate Bridge were built during the Great Depression. Now is a time to think big, create your vision and take action. With more people living in fear and fewer people taking initiative the rewards and recognition will be greater for those willing to work hard and dedicate themselves to building a great business, product, service, and vision. As we know, there is no substitute for hard work and now is a time where those with a positive attitude and great work ethic will shine.
With extensive experience oin working for some of the biggest brands in the business, including Hilton, Holiday Inn, Marriott and Forte, Sanjay Nijhawan has been in the hospitality industry for over 17 years. Mr. Nijhawan joined Thistle Hotels in 2004 as general manager for The Tower in central London. Earlier this year Mr. Nijhawan was promoted to Chief Operating Officer of Guoman Hotels (UK) overseeing the development of a collection of six international deluxe properties in central London. Mr. Nijhawan graduated from Thames Valley University in 1992 with a degree in hotel management. Mr. Nijhawan can be contacted at 0870 333 9280 or Sanjay.firstname.lastname@example.org Extended Bio...
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