Serving your customers should always be at the heart of your selling and marketing activities. But while businesses have radically changed in the last few weeks, it may not be all systems go for your customers.
Before you hit the sell button, adapting your sales strategy by understand the evolving consumption patterns in a downturn and how to serve your customers when they are faced with stricter priorities on their wallets and reductions in their spending. It could make all the difference to the survival of your business.
STEP 1 - customer mindset
What category do your customers fall into?
Stop the car - These customers reduce all spending by eliminating, postponing, cancelling or substituting purchases.
20m/hr zone - These customers are optimist about the longer term but are conservative about the near-term spend and their ability to cover costs in the short term - they will economise.
Cruise control - comfortably have enough money in the bank and can sustain a volatile market. If they are a B2B business they aren’t needing to raise any capital and are serving customer segments that have equally haven’t been as affected
100m/hr in a 60m/hr zone - Carries on per usual and hopes not to get a speeding fine. It’s likely this segment will extend larger purchases for safer times.
STEP 2 - spending vs sales
Where does your product/service fit within your customer’s wallet?
No doubt you’ll know how price-sensitive your customers are. But how about thinking about adding additional value to what you’re selling? You could use this opportunity to reposition your offering. Or you might be willing to engage in a price reduction exercise to gain traction or to boost growth. Where does your product or service fall within your customer's strategic / volume decision matrix.
Adapted from HBR article, How to Market in a Downturn
STEP 3 - where are the new opportunities?
What opportunities can you seize from competitors who are ‘stuck’?
Should you double down on your core business? Or continue to chase higher growth potential opportunities?
What are the customers’ or competitors’ pain points that create an opportunity for you?
What can you get at a lower rate to add efficiencies or enhance your product?
STEP 4 - sales strategy
You typically have four sales approaches:
New offerings to new customers - this is difficult and will take resources
New offerings to existing customers - this requires a repositioning with existing customers, it’s cheaper as you forgo the costs of opening the door but it’s difficult to reposition, especially if you are looking to add on high-value offerings
Existing offerings to new customers - this is easier as you have a product and now it’s about building repeatable and scalable sales processes, but it will require a different focus
Existing offerings to existing customer base - this is doubling down and finding new customers. Success will largely depend on where you are at (saturated market / open opportunities). Will likely require a new pricing strategy
Once you’ve decided your plan of attack, make sure you show empathy to your customer’s current situation. Check your marketing approach is well-positioned and captures market sentiment.
Then it’s back to the drawing board of analysing, measuring tracking, testing, tweaking and repeating until you find a new normal.