In a Recession Adapt to Customers' and Partners' Shifting Needs

In a Recession Adapt to Customers' and Partners' Shifting Needs
(Marketing Memo, December, 2008)

Anticipating the recession, John Quelch observed in the March 3, 2008, Harvard Business School Working Knowledge ezine, "The key�is to understand how the needs of your customers and partners change, and adapt your strategies to the new reality." ("Marketing Your Way Through a Recession")

From pencils to fuel, businesses are looking for ways to reduce expenses. In difficult times it is more important than ever to talk with customers and prospects and find out how their situations and needs have shifted so that you can adapt to these changes.

Watch the business press for news about customers and partners. Knowing when customers or partners are about to be acquired is critical as the acquirer will scrutinize all pending purchase decisions and other major decisions. You need to know if the company's center of gravity has shifted from Boston to St. Paul. Ask for the name of the new decision maker. Then redirect marketing material and sales calls and outflank competitors.
Study customer behavior. External changes have affected how customers purchase and use goods and services. Businesses reschedule deliveries to fill trucks and substitute electronic document delivery for delivery by Federal Express. Businesses also manage with older products. Adding a few nice-to-have features to your product will no longer lead to sales. Make an airtight case about the value of new offerings based on the customer's changing circumstances and behavior.
Identify "the why behind the why." An interviewer asked a plant manager if his company would buy software that monitored large rotating equipment. The manager replied, "No, because it wouldn't work." Further probing revealed fears that automating equipment inspection would lead to elimination of the plant manager's position. The software company learned it had to demonstrate that the product would help plant managers work more effectively. Online interviews would not have provided this insight.
Note new trends that are affecting customers and prospects. Some customer service agents now work in their homes in the US rather than in overseas call centers. Homeshoring and other new trends represent new challenges and new opportunities, such as equipping those home-based agents. If you train customer support personnel, consider offering online courses for home-based customer service representatives.
Repackage products and services. If prospects say they want a less robust version of your offering, consider such a strategy. However, instead of lowering prices, repackage offerings. Sell separate modules of your product, or bundle products with free product support, but for a shorter time than before, for instance 18 months, not three years.
Monitor competitors. Besides tracking product introductions, notice whether competitors are succeeding with new types of marketing, such as social media marketing. This means marketing through the use of wikis, blogs, podcasts, and social networking sites. Investigate whether these new outlets are cost-effective for your organization.

We can help you gain a better understanding of your customers' and partners' shifting needs. When you understand these needs, you can help your customers and partners navigate through turbulent times. They will become more loyal to your company and will be more likely to recommend your company to their partners.

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