A common theme in conversations with prospective clients lately is the “desperation motif.” A client operates a tool making factory and orders have slowed down to such a slow trickle that, as he forecasts future orders, a huge question mark lingers over the horizon: he knows he might not make it. Or, the Realtor dealing in commercial real estate who has clients eager to buy but are succumbed over and over by banks backing out at the last minute, hesitant to lend money in an uncertain economy.
Is the economy improving? There definitely are signs indicating such. Then why are people and businesses so scared?
It’s an endless, self feeding roller coaster. A company is afraid to increase investment because the economy might fall backwards and they want to minimize the risk. The provider in turn, whether it’s a construction company or supplier of equipment, is forced to cut back because, long term, until their buyers’ frozen checkbooks thaw, they stand to have to wait out an even longer recovery period. The provider lays off employees whose income is then deducted from the local economy. Grocery stores, restaurants and retailers see their income continue to decline. And the initial company’s fears are realized as accurate.
Many heads of corporate marketing are eager to break out of this vicious cycle. A two year plus recession is two years too long. But, while the initial steps are taken (i.e. research into new promotional marketing strategies, requests for proposals from marketing firms), the follow up is what is still lacking. Companies are afraid to jump from the cliff because they are afraid of the fall.
Does there have to be a fall? Inevitably, in our apparently slowly regaining economy, there will probably be some fall. The billion dollar question, however, is how much of a fall will a brave, cutting edge company that steps forward from the hesitant pack experience?
Over the past month, I have run into many companies in this same predicament. With my efficiency consulting and internet marketing background, my advice to some is to jump and take the risk. While the investment may be a total loss, the gamble is worth it. While key competitors continue to cut back, a slender company with some extra backup funds in the bank should risk a complete loss because gain is presently the least expensive right now. Companies experiencing the “desperation crisis” should also move forward taking the risk for wild future growth.
Advertising costs are relatively low as media conglomerates are scurrying themselves to minimize layoffs and are bending over backwards to attract ad buyers. Online investments continue to take place, but the overall online growth is much slower than it was just two years ago as most venture funders have significantly scaled back on their green flow. While customers are still hesitant to make spontaneous large purchases, the trend is for savings bored shoppers (and businesses) to loosen up and spend.
Courageous – yet gambling – companies who step forward now and risk an investment in growth and marketing may be standing at the open door of a lifetime. Admittedly, it’s hard to see because that opportunity is handed to us with a blindfold as part and parcel. It’s up to your vice president of marketing to brave the blindness and see beyond it to the glimmering gold ahead … and then he or she needs to force their persuasion on the corporate head.
So go for it. Sink or swim. If the sounds of the funeral bell are pealing in the distance for your business, go forward and take the risk for success. Just don’t blame me if you sink, because I’m making the same gamble too!
CEO of Sozo Firm Inc