Sunday, December 7, 2008
Survive? or Thrive!
I remember like it was yesterday back in 2000 - Almost exactly 8 years ago this month when marketing spending literally shut off. My interactive media company's monthly revenues fell off the map with a 75% drop as customers shunted all media spending. We made it through and emerged on the other side stronger than ever before and this time around, we're continuing strong into territory that our contemporaries are back in the same trouble again as we all were 8 years ago. (I'll post more about how I did that recovery later)
So, what's going on here? Why are we looking to hire, when others are cutting staff and battening down the hatches?
A few things - first off, interactive ad spending is showing itself to be fairly resilient in this economy. I believe this is a result of the fact that you can track back revenue dollars directly to media spends for email marketing, keywords, etc. whereas in other spending (outdoor, broadcast, etc) you can't track those dollars. As a result, you don't know that your media buys are bringing in revenue, so you keep with what you KNOW is working (ie. interactive) and cut back on the rest - or shift those dollars into interactive.
In regards to us directly in terms of what we're doing right (and what we might be doing wrong) when we cmae out of the last downturn and prospered, we didn't change our value prop as things got good, such that we're operating with the same mentality that we had when things were really tough. Remaining in an downturn mindset keeps us focused on what's important at all times, regardless of how good things are (or aren't). Our clients continue to receive value from our relationship thus projects (and revenue) are continuing in ernest.
Mind you - every month we have to sell our A/R and while about 25% of our revenue is contractually recurring, we haven't adopted the attitude that we're bullet proof. Exactly the opposite is true. If anything, we're selling harder (and smarter) than ever and continue to add clients to our portfolio as we move forward.
As long as we continue to provide ROI much like online marketing is doing against other media, I believe we'll continue to prosper in these tough times.
Is your mentality one of survive or thrive?
Better yet, what is your competition doing?