Lessons from a Down Economy
If we merely survive this economy…
…we’ve wasted an opportunity to grow.
The Dalai Lama says that we ought to be most grateful to those who cause us the most trouble because they afford us the greatest opportunity to learn. The same can be said for challenging times.
There is little doubt that these are uncertain and confusing times. The question is what lessons can we take from these times to better position ourselves for the future. Here’s what I’ve learned.
Resilience
We’ve lived through tough times before and come out stronger for the experience. We will again. I’ve lived through the recession in 1974 when interest rates were an alarming 12%. Only to find them pale in comparison to the 21% rates in 1983.
By the way, I was in the mortgage banking industry during both periods. People in that industry have asked that I not return. Sorry folks, but whether I re-enter that market again or not, we’ll see much higher rates in about three years.
The lesson is that regardless of the depth of the problems we’ve faced in any economy, we’ve always recovered. We’re human beings, we’re resilient.
You’re in the marketing business
Success in business has less to do with what industry you’re in, what offerings you have or what business model you use, than it does with your ability to market your offerings effectively. If you doubt that, recall the tremendous success Microsoft has experienced because they were more effective than Apple in marketing in the early years. Once buyers become accustomed to a vendor it’s difficult for them to change even when they’re experiencing problems. Again, that’s human nature at work.
If you want to enjoy greater business success in the future, use this economy to gain greater clarity about who your ideal customer is and how to tailor your marketing message to attract them.
Value is more important than price
Many business people think that buyers become more price conscious during a down economy. The reality is that they become more value conscious. It becomes more important to the buyer that every dollar spent provides optimum value. Let’s say that you’ve historically bought name brand canned vegetables. In a difficult economy you may try a store brand, but if it doesn’t taste as good as the name brand, you’re not going to change. If there isn’t a noticeable difference, you’ll switch to the store brand. Either way it’s a value decision.
It’s counter-intuitive, but focusing on what we can learn from a down economy instead of survival will allow us to enjoy success in any environment. Some of you may be thinking “That’s not counter-intuitive!”
If you’re right, then why are so many people operating from fear? Why are business people focusing on pricing instead of marketing? Why do business people lower their prices in attempts to salvage market share when that strategy has failed in every economy in the history of commerce? Why do job seekers use the same techniques that everyone else is using?
This discussion of a down economy reminds me of an old baseball adage. An umpire is asked “How do you know whether a pitch is a ball or strike?” His response was “It ain’t nothin’ til I call it.” This is a down economy only if we choose to call it that. Our mindset is going to determine how challenging these times are and what we gain from them.
The 7 Steps to Becoming INVALUABLE program is designed to help you see more effective ways of doing business – ways that dramatically improve your bottom line while making your life easier. In today’s blog I used Step 6, Eclectic Education, to gain insights from the Dalai Lama. Step 4, See Similarities, to demonstrate that the concept applies to situations as well as people. I also used Step 5, Contrarian Mindset, to demonstrate that the approaches businesses use in down economy are counter-productive. For more information on the 7 Steps to Becoming INVALUABLE visit www.furtwengler.com/7steps.htm.
If you’d like to receive a weekly email reminder with a link to The Invaluable Leader blog or if you’d like me to address specific topics, please send me an email at dale@furtwengler.com. Please share your experience with our readers by posting a comment.
Borders bookstore is hosting a book signing for my latest book, Pricing for Profit, on November 10, 2009 at 5:30 p.m. There will be a brief 10-minute presentation on Common Pricing Errors…and tips for avoiding them followed by a Q&A session.
On November 17, 2009, the Cottleville-Weldon Springs Chamber of Commerce has graciously invited me to present an expanded version of Common Pricing Errors at their breakfast meeting at 7:30 a.m. http://www.cottlevilleweldonspringchamber.com/
Coming soon! I’m starting a new blog, Pricing for Profit, which is dedicated to helping you get compensated well for the tremendous value you provide. Stay tuned for more information on the Pricing for Profit blog.
