'The Recession is a roller coaster thrill-ride to hell that will leave you breathless and broke. The worst financial crisis since the Great Depression!'
And people believe the hype. When you have financial gurus like Suze Orman going on CNN predicting there will be bread-lines in the streets, frantic Americans are already starting to line up. Politicians add to the drama. How many times lately have we heard, 'If we don't act now, it'll be the end of our way of life as we know it.' You know, maybe we do need to have some things come to an end in order to reassess our priorities and put duct-tape over the mouths of some of the people we let influence us.
There's no doubt there's a violent storm all around us, but I refuse to fly into it. Like an eagle, I'm going to use the wind to soar above it all. If you don't think there's any substance in a statement like that, ask yourself if you really do have a choice in all of this or not. As my dad said to me growing up, 'You can't control what happens, but you can control how you react to what happens.'
I get e-mails and IM's from other developers and clients asking me my opinion on The Recession. I won't comment on the actual events that got us into this mess, because what good will that do now? The past is prologue, and I'm focusing on what I can do to contribute to a brighter future. Therein lies the big question all of us have to first ask: Will it get better?
I believe most of us would answer that question in the affirmative. If not, the alternative is just to give up. Real entrepreneurs never give up; they have the grit and determination to press on no matter what circumstances come their way.
Things will most assuredly get better. The aftermath may not be exactly how we pictured it, but those that are able to strategically adjust will be in a much better position afterwards. A fire is currently raging throughout the forest of our economy, and it's guaranteed to burn up all the small trees, bushes, and even the bigger malformed trees. The tall, strong trees are going to be the only things left standing. So what are some things online retailers can do to be one of those trees that not just survive, but thrive?
First, a bit of history is in order. Some of the largest brands out there were birthed out of a hard economic climate:
* William Wrigley Jr., the maker behind Juicy Fruit and Wrigley's Spearmint gum, started his company with $32. When he set out to sell soap, he included free gum as a gimmick. When the soap didn't sell, he was savvy enough to focus on the gum itself.
* James Casey, 19, formed his delivery company in the miserable economic climate of 1907 with the mission of out-servicing unreliable companies out there with courtesy and respect. His company? UPS.
* Broke partners Tom and James Monaghan borrowed $500 to make a last-ditch effort and starting a pizza shop called 'DomiNick's' in Michigan. They delivered pizzas so quickly that it turned into Domino's pizza.
* Super 8 Motels got their name by setting a recession-friendly rate of $8.88. They used the momentum they garnered by franchising their motels, currently opening up a property every 18 days.
* Microsoft started in a motel room when the country was still reeling from Watergate. They chugged along until 1981, during another recession, where they introduced MS-DOS, catapulting them to the industry forefront.
* Remember the dot-com bust? NewEgg.com sure does. When other companies crashed and burned around them, they focused on excellent customer service and are reaping billions a year.
What do we do now? What can we learn from some of the examples above? Here are a few things to focus on:
1.) Strengthen your brand.
If you are focused purely on slashing prices to stay afloat, you may be neglecting your most powerful asset: your company brand. If customers don't trust the power behind your brand, they won't buy your products. Ignoring your brand-building during these times will handicap your chances of success more than anything else.
2.) Make customer service a top priority.
Most of the stores seem to make a game out of hiding their contact information from their customers. Make sure they can contact you easily, and that every interaction with them is prompt and friendly. Advertise front-and-center on your store design your commitment to serving your customers by telling them exactly what you'll do for them that the other guy won't.
3.) Invest in your people.
Make sure your core management team is as strong as possible, by eliminating sources of stress around the office and amping up the amount of encouragement, training, and benefits. This will give you a strong advantage over competitors when the economy turns around.
4.) Be the leader.
You have to make every commitment to being the leader in your niche, or you could soon find yourself following the rest over the side of the mountain. Get on top of the mountain. I'm not talking about being the leader in your target market; that's too broad. I'm talking about being the leader in the niche within your target market. Also, your employees need to see you as the leader, and so do your customers. Refuse to give in to fear and embrace faith.
5.) Discount, but don't go crazy.
Anybody can lower their prices in order to try and be competitive. Do yourself a favor-- try steps 1 through 4 and then let's talk about how cheap you need to go. My advice-- let your pricing be a pleasant after-dinner dessert on your menu and not the main course.
I'm getting fired up just by writing this entry. I could go on and on, but I'm going to focus the rest of my energy on getting back to work at making EYStudios better than ever. If you want to join me in being pro-active about strengthening your company for tomorrow, give us a call.
And remember, eagles don't flock with turkeys.
