How to Market Your Business During a Recession

As consumers' expectations for discounting continues, how do businesses continue with promotional strategies without losing their shirts?
Amy King, vice president of business intelligence at Valpak, tells businesses to start with a plan - and then stick to it. King shares some straightforward do's and don'ts of promotions and discounting and advice on how businesses can monitor their campaigns to make sure they are generating revenue.

Difficulty: Moderately Easy

Instructions

1. 1) The discount should be relevant and make sense for your business.
   
   Make sure the offer is appealing to your clientele and fits how your customer buys from you. For example, Buy One Get One Free (BOGO) appears to be a strong offer on the surface, but if your customer wouldn't typically buy multiples at the same time, it is not likely to work well. Be sure you understand your customer so that the offers are relevant," says King.
   
   Also, businesses must stay focused on the objective of the advertising campaign. "Offers should match the behavior that you're trying to create," says King. That might mean using themes or offers that encourage repeat visits. Also, diversify your offers to appeal to different types of consumers.

2. 2) Be committed to your campaign.
   
   One of the most important parts of any direct mail program is frequency. You need to advertise consistently so consumers see it and can respond when they are ready.
   
   "Sometimes a consumer sees the offer but they don't respond right away," says John Widmer, Valpak's Audience Research Manager.
   
   Depending on the buying cycle of an industry or personal economics, businesses need to remember it can take several months or more for a consumer to respond. "That has to do with need and timing," says Widmer. "Consumers look for an offer that is appealing and has value, and they may respond immediately. But with big ticket, high commitment items, they are likely to take more time to consider the offer and wait until they need to make the purchase."
   
   "They may not seek you out unless you're right in front of them when they need you which is why it is important to advertise regularly," says King.

3. 3) Mail to the right homes - don't waste your advertising dollars.
   
   How do you know who to mail? Target your mailings to your best potential customer and then decide how large an area to mail.
   
   You wouldn't stand on a street corner and shout your offer to random traffic would you? To get the best use of your time and energy, you'd want to target your message to the people most likely to respond. Do the same with your direct mail advertising. Take advantage of marketing partners that can provide you the latest research as well as consumer targeting by geography, demographics, behavior and past expenditures.
   
   As for how large your mailing should be, that's not just a budget question.
   "When asked, "How far would you drive for an offer?" consumers in our focus group told us that the better the offer, the further they would drive," said Widmer. "If it's a good offer, a high ticket offer, then they are willing to go further."
   
   Now, think about your business. How far can you go? Don't overextend your business to the point where it may impact your bottom line or service level. For example, if you're in a service industry and have a limited number of trucks, you may need to limit the territory where you mail.

Tips & Warnings

• Success is a science And once consumers do respond, measure results against your objectives. Was your goal to generate new customers? To drive phone calls? To promote a new menu item? Make sure you compare results against those goals. "And don't just staple the coupon to the receipt and put it in the register. Analyze the transactions. Did those customers just buy the discounted item or are they spending more?" said Keith Malo, Valpak's research services director. Valpak research shows that well-planned discounting typically prompts customers to spend more.
• Be prepared, or it could flop When businesses discount or offer a coupon for the first time, they may not be prepared for the response it will generate. King warns that could be a mistake. "If you drive consumers to experience your product or service and you're not prepared to be at your best, you might as well shoot yourself in the foot" said King. "Educate and train your staff to accept the coupon. Not only so you can measure it, but also so the consumer feels wanted, welcomed and appreciated. Training your staff to handle promotions coupons is just as important as the offer itself." Although many businesses depend on a seasonal rush, a well-planned, trackable incentive or discount will continue to connect them to their customers throughout the year.