Sales and Marketing in Uncertain Times: On the Front Lines

Sales and Marketing has always been on the front lines—touching the customer directly, regularly. So, during tough times that contact needs to be maintained with increased attention. Sales used to be about making numbers; it’s now about making profit--margin. They’re different. How much money will the sale bring to the bottom line and how much will it cost to service the client both have new meaning when CASH and not growth is king. Here are a few of many suggestions Charan has for leaders in uncertain times.

1. Evaluate Your Organizational Structure: Perhaps reorganize on functions, not regions, for added efficiency. Convert your sales people from “order takers” to “problem solvers.”

2. Create Intelligence Agents: Make sure that sales people become the eyes and ears of the company in the field. This could take on a war room mentality. They can then report back on customer viability for the future, issues at play, and how to help customers succeed.

3. Set and Reward Realistic Sales Goals: In concert with the hands on, head in philosophy that Charan recommends for CEOs, this advice he applies to sales. Sales goals should not be compared to last year but should likely be set month to month to stay realistic. On the other hand, Charan warns not to be too quick to reduce targets, lest they become self-fulfilling prophecies.

4. Other important areas that Charan comments on in this section are as follows: Help Determine Which Customers to Drop, Know What Your Customers Want, Be Sure You Have Input into Product Decisions, Craft Better Value Propositions, Do Not Sacrifice the Brand, Target Advertising and Promotions, Adjust Pricing Fairly, Cut Costs Wisely, Link Sales People to Operations and R&D, and Link Sales People to Senior Management.

Marketing in a Downturn Economy

This is the 2nd in a series of several posts this week from a review of the April issue of the Harvard Business Review, which focuses on navigating in a downturn economy.

Article Review: How to Market in a Downturn (by John Quelch and Katherine Jocz).

The authors suggest that marketers in any company consider four (4) psychological states that their markets might be segmented into:

1. Slam-on-the-Brakes: People most affected by the recession—lower income or anxious consumers. They halt all but the most necessary of purchases.

2. Pained-but-Patient: More stable and optimistic about the long term. Less certain about the future. Cautious about larger, less necessary purchases. Typically the largest segment of population, who are often unscathed by employment issues.

3. Comfortably Well-Off: These folks continue to purchase nearly at the same levels as pre-recession. They think they can ride out the bad time.

4, Live-for-Today: This group tends to be urban and younger consumers, unconcerned about savings, who yearn for experiences, less than possessions. They tend to buy today and are unlikely to change their habits.

I like the easy-to-comprehend matrix that describes each class of consumers and well worth studying and applying to your particular market segment.

The authors have also have created a second and equally useful matrix called “Tailoring Your Tactics” to the above 4 psychological market against types of products at risk described as follows:

--Essentials—basics products/services needed to sustain life (survival)
--Treats—indulgent products/services considered justifiable
--Postponables—needed products or wanted but can be put off
--Expendables—products/services that are both unnecessary and unjustifiable.

For example, the authors suggest when marketing Treats to the Pained-but-Patient consumer, offer frequent patron use items (buy 3 and get one free), advertise products as morale boosters, and advertise products as options to more expensive and frivolous luxuries.

The authors also offer a list of “7 Smart Ways to Economize on Advertising.”
For example: “#4 Advertise brands jointly with a marketer in a different product category that targets a similar consumer segment.

This article is well worth the read in its entirety for any business in the midst of trying to redefine a strategy for troubled waters.