Friday, September 12, 2008

Rejecting the Recession

Technically, we haven't had a recession. In fact, growth was larger than expected last quarter.

So the economy is growing, has been growing, and is expected to keep growing. All this despite the fact that we're dealing with the largest bailout of irresponsible homeowners, irresponsible realtors, irresponsible loan officers, irresponsible bank officials, and irresponsible government hacks in the history of the world.

That's a resilient economy!

Slower growth is not fun, but it's not a recession.

One of my favorite Infopreneurs is Stephanie Chandler. She wrote From Entrepreneur to Infopreneur.

Anyway, I was preparing to interview Stephanie for the Promotion Monkey Newsletter, so I visited one of her web sites:

www.thebusinessgrowthconnection.com/. Up pops this cool graphic.



As you may know, Erick Simpson is brilliant. He knows how to market. One of the ways he's been marketing himself is to go around the country taking advantage of people who believe the empty suits in the media. Recession, Recession, recession.

Even though Erick knows there's no recession, he gets himself in front of a crowd so he can talk about making money in an economic downturn.

I've posted several times that my companies are sitting out the recession. We reject the recession.

So I was very happy to see that Stephanie Chandler is singing the same tune. See Stephanie's Blog. Five great ideas for fending off the recession. I don't want to steal her thunder, but her first point is 100% on target: "Businesses that continue to market through a recession come out ahead when the economy begins to turn."

You don't have to buy billboard space and time on TV, but don't cut your marketing budget just because things slow down!

This is more important for small businesses than for bigger businesses. Remember, small businesses tend to market to small businesses. There's always some "churn" and turnover. Businesses come and go. That speeds up a bit during downturns. And when the sun comes out, it means something when your business has survived a dip in the economy.

Hang in there. Work hard. Focus on the basics. Get the job done.

And when things turn around, you'll be ready and primed to win the next round!

:-)

6 comments:

  1. Erick Simpson10:18 AM

    Karl - great post. I'm happy to see that Stephanie agrees with us both! She highlights several strategies that I also communicate during my "Increasing Service Delivery Revenues During Economic Downturns" presentation. Here are all of them:

    - Target the right clients and verticals

    - Shape your marketing message to reflect alignment with your prospects and clients' needs

    - Modify your deliverables to be more attractive to prospects and clients

    - Modify your pricing and payment options

    - Increase marketing activities over historical levels

    - Reduce internal costs wherever possible

    - Raise your rates regularly

    - Continue to invest in tools and technology to increase your efficiencies, scale and profits

    - Partner with vendors and other providers to offer additional services which you do not that your prospects and clients need

    - Move the balance of your deliverables to reduce commodity-based products and services

    - Leverage your vendor and distributor relationships to obtain participation in co-operative marketing events and receive marketing development funds

    - Add financing as an option to each and every proposal

    - Investigate the viability of offering HaaS and Saas solutions to prospects and clients

    - Build deep client relationships as the Trusted Advisor/Business Partner to lead enterprise change in your client environments

    There should be no reason that service providers who sell on and deliver real value to their prospects and clients should be anything but successful with the right strategies.

    Who would like to add to the list? Your comments are requested.

    Erick Simpson
    MSP University
    www.mspu.us

    ReplyDelete
  2. See? I TOLD you he was brilliant.

    Dear readers: Take Erick's advice to heart. There are people paying to get this advice every day.

    Erick has just summarized his 90 keynote speech.

    Thank you, Erick. I'm looking forward to the Absolute Best Practices preday event.

    ReplyDelete
  3. Hi Karl,

    I guess we have different views what a resilient economy is then! A robust economy would've let the privtaely owned Fannie Mae and Freddie Mac go to the wall. Isn't that the way of the Free Market? Except the US Govt has taken them over and very kindly going to get you all to pay for it! Much like Northern Rock for us except we call it Nationalisation in the UK.

    I would've thought that in business planning people should assess the threats/risks otherwise how can you mitigate them? This is not to create a doomsday scenario but just to understand that a lot of people are hurting out there.

    Technically the UK is about to enter a recession, we have just a one quarter of negative growth and the OECD is predicting recession for us and our Chancellor has just told us things are bad as if we needed to be told!

    Like you, I too will be trying to reject the recession and taking Erick's very good advice.

    Cheers mate

    Vijay

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  4. Karl,

    I agree that we need a positive attitude and to keep moving forward despite the failures in the current economy and that there are opportunities to be had for the creative and hard working. But to say that we aren't in a recession doesn't make sense. What we can say is that the old measurements aren't working. Rational people can look at our failing banking system, increase in foreign ownership of the backbone of our economy, decrease in production, uncontrolable deficit, lowering of the income of the middle class as all evidence of an instable economy and recession. That we can't detect evidence with the current recession measurement only indicates that it's time to look at what we are measuring. The times are changing and if we don't change our measurement along with our attitude and our businesses thing won't get better.

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  5. Vijay, it's pretty darn resilient when you can have the failure of institutions that hold the financial paper on half the homes in the country and we have very little economic ripple.

    Yes it's nationalism. But we don't use that term here. It's really socialism, but we don't use that term either.

    Looks like the U.K. has a couple of bad quarters ahead. I just hope you don't have such a large population of irresponsible people. We breed them here.

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  6. Amy: I'm not saying there's no downturn. There's a slowdown. But that's not a recession.

    The basic economic construct is about growth. The economy is either growing or shrinking. Setting aside this moment in history, we'd still want to measure when the economy is growing vs. shrinking.

    Slow growth is not shrinking. Very slow growth is not shrinking. Very very slow growth is not shrinking.

    Recession is the label we have for when the economy is shrinking. Slower growth, slowdown, and downturn are all great descriptions of what's going on.

    I'm happy to have someone come up with a word for what we're going through. But if we adopt the word recession, then we need a new word to describe an economy that is shrinking.

    The other day I heard on the radio that China's economic growth rate had slowed from 15% to 8%. So their current growth rate is 8%. We'd love that. But the commentator said:
    "When you're used to 15% growth, 8% feels like a recession."

    Same with us. When you've just gone through 5% or 6% growth, 2% feels like a recession.

    But it's not a recession.
    :-)

    ReplyDelete

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