In our current economy there is a fine line between a thriving and sinking business.
Recent ABS figures show retail businesses only enjoyed 0.3 percent growth in April, with a small increase in clothing and soft good retailing, household good retailing, and other retailing, whilst food retailing, department stores and cafes, restaurants and takeaway food services declined.
According to marketing consultant Connie Kosti, the one thing that differentiates who will and wont survive is their ability to adapt to the changing economic environment.
“The key to keeping your head above water is to always be in touch with clients, to understand what they need and what they don’t like. You need to be flexible so you can modify what you are offering in response to the market.”
Such a strategy has allowed Peter Mavridis, CEO of IT Services Group, S Central to find a niche in the information technology market and enjoy 33 percent growth in the last financial year. This at a time when the industry has had negative growth.
“S Central has positioned itself during this downturn by focussing on its customers and delivering to their expectations,” Mavridis said.
“It focuses on IT Services and that business has continued to grow as organisations are reducing the size of their IT Departments and requiring organisations like S Central to make up the technical requirements.”
Kosti underscores that marketing is a crucial element of surviving the downturn.
“Even in good times businesses need to be marketing so that when you continue marketing in bad times business remains constant.”
Founder of Souvlakihut, Bill Fotiadis, attributes his company’s 20 to 25 per cent growth to a significant, long term investment in marketing.
Souvlakihut is currently advertising on TV in three states and is aggressively rolling out new stores across the nation.
“Remember if a potential customer does not know what you do or (what you) sell, they will never walk into your store or use your service,” Fotiadis said. “Get out there, be loud and get everyone’s attention.”
Kosti explains that larger businesses can afford to undertake long-term mainstream media campaigns in difficult times and adds that small businesses can still create employ an effective marketing strategy with a limited budget.
Regular calls or email contact with existing and prospective clients, sponsoring community clubs, internet advertising, and importantly, bundling services are some of the marketing initiatives small businesses can implement.
“Lets imagine you are a tourism business in Wollongong. You would aim to give people a strong reason to visit your destination by packaging a complete service.
“That is, by pulling together flights, accommodation, wine, cheese manufacturer and art gallery visits into one package. In this way you not only touch on all the senses, you also make it easier for the consumer.”
While consumers are spending less, Kosti encourages a focus on adding value rather than discounting.
Fotiadis has successfully employed this technique with Souvlakihut’s ‘Kids Eat Free’ promotion, which has resulted in both consumer affordability and increased sales.
Kosti also suggests networking with related businesses to drive traffic to each other. For example a fashion store could offer their clients exclusive discounts to the nearby hairdressing salon, with the logic that the client may be looking to have their hair styled for that special event.
The hairdressing salon could in turn offer discounts to their clients at the coffee shop next door.
There are different ways that businesses both large and small can take to ride the downturn.
Kosti reminds us to stay confident.
“As a business owner you have to be optimistic and feel there’s opportunity to keep growing. If you start believing everything you read or hear you are going to be affected.”
This message is reinforced by Fotiadis who says that when you are in business you should look at luck as a dividend of sweat. The more you sweat the luckier you will get.
Business tips in a snap shot