There’s no sugar-coating it: The ongoing public health crisis has revealed massive vulnerabilities in the United States’ consumer-driven economy and in our ability to cope with a serious pandemic. Few understand this better than the millions of newly unemployed US workers and the small business owners struggling to stay afloat.
Although the economic outlook is still very uncertain, entrepreneurs are finding ways to forge ahead despite the challenges. Toilet paper may be out of stock, but the supply of old-fashioned American determination has yet to run dry. If you own a small business that has gone into survival mode, here are five actions you can take right now to give yourself a fighting chance.
1. Diversify Your Revenue Streams
If your business model depends on a single revenue stream and that stream is disrupted by the coronavirus lockdown, you will be forced to make very tough financial choices. Tapping into new revenue streams is one way to offset disruption, and adding new products or services is one of the most common ways to diversify.
If you run a restaurant or bar, you may have already ramped up your curb-side pick-up and delivery services. Unfortunately, some customers are avoiding buying food from restaurants and bars altogether. How can you earn revenue from customers that don’t leave their homes except for absolute essentials?
Gift cards can be an effective supplementary revenue stream. According to the Washington Post, restaurants in hard-hit cities like Seattle have successfully supplemented revenue with gift cards because loyal customers want to support their favorite local eateries.
Check out giftcards.com for more information on the various types of gift certificates available and how to utilize them. To maximize gift card sales:
- Allow customers to easily purchase gift cards online
- Promote gift cards on all your marketing channels to increase awareness
- Consider offering a special promotion, such as 15% off gift cards of $50 or more
Offering enticing discounts and deals for pre-purchased goods and services is especially important right now for service, travel, leisure, and hospitality businesses. Own a bed and breakfast or small tourism venture? Consider offering a special package deal that is too good to pass up and only requires a modest down payment upon booking. Offer an iron-clad exchange policy so customers can reschedule if they need to. Do whatever it takes to boost buyer confidence.
Of course, revenue diversification should go beyond gift cards and special deals. Start thinking about ways to market and sell information products. These products require little to no investment to create other than time. If you own a food service business, you could create a downloadable PDF cookbook with unique recipes and sell it online as a way for loyal customers to provide support. Entice customers into buying your downloadable content by offering free sample content and/or a how-to video. Other info products include eBooks, webinars, online courses, and live virtual events.
When developing info products, make sure you can:
- Provide quality content that is relevant to your target audience
- Deliver something unique and original with your own spin on it
- Teach people something beneficial or help solve a problem
- Make it affordable and extremely easy to buy online
Get familiar with social media and content marketing so that you can promote both your info products and your business. You can also provide content in installments, which will keep your audience anticipating future releases.
Branded “merch” like T-shirts, hats, sweatshirts, stickers, and mugs have tight margins but can bring in some additional revenue. By working with a print-on-demand business like Printful or Printify, you can market and sell branded products with minimal up-front cost. Consider working with a graphic designer to create limited-edition merchandise that will delight your most loyal fans.
Social proof matters! Allow your customers to review your business and products. If you deliver genuine value, this will be reflected in your reviews and inspire more people to purchase.
Finally, you may have noticed how many of the most successful online stores upsell and cross-promote products. A great example is Amazon’s “related products” carousel that displays prominently on every product page. Make opportunities to alert customers of additional (and pertinent) purchase options on your website.
2. Get Laser-Focused on Customer Experience
No business can survive without customers, and it’s generally much easier to earn revenue from loyal, repeat buyers.
Even during a public health crisis, many people will continue buying products and services from the businesses they feel most loyal to. However, it’s still extremely important to stay top of mind with your customers and incentivize them to stay engaged.
If you aren’t pulling out all the stops to maximize customer loyalty, now is the time.
Customer experience is also more important than ever before.
Failing to understand customers’ needs is one of the biggest ways you can fail at customer experience management. Get to know your customers’ pain points and clearly communicate how you help solve them. Long response times, lack of personalized communication, and poor user experience are some other common pitfalls.
Do you have a Customer Relationship Management platform that allows you to stay connected with your base, remind them you are still open for business, and alert them to new promotions? Modern point of sale systems like those offered by Square have CRM, email marketing, ecommerce, and customer loyalty features built in, making it much easier to manage relationships. Although upgrading your POS system costs money, the immediate and long-term return on investment may be significant.
Now is a good time to take a critical look at reputation management to see how you might improve or expand your efforts to cultivate honest, two-way conversations with customers. Don’t ignore the current pandemic situation. Be transparent. Reinforce the notion that “we’re all in this together.” (Of course, make sure your business is carefully following state and federal public safety guidelines).
It’s also important not to be tone deaf. A lot of businesses are pushing out generic messages like “We’re here for you,” and some customers may find this disingenuous, especially if you sell jewelry, cosmetics, or other non-essential luxury goods or services.
Whatever your business model, if you have the budget, do something that contributes to helping your community, such as donating a portion of profits to an organization that provides protective equipment and supplies to medical professionals like Direct Relief or a regional food bank. Even small contributions can make a difference, and customers will appreciate the effort. Is this good PR for your business? Yes, but it’s also just the right thing to do.
3. Revamp and Expand Your Marketing
When you’re operating on a shoe-string budget, marketing may seem hopelessly difficult. Although you’ve been forced to run lean, now isn’t the time to put marketing on the backburner. Now is the time to double your efforts by heavily investing time and energy into perfecting your customer-centric inbound marketing strategies. This includes strategies that attract more people to your brand, boost engagement, build brand loyalty, and delight people so much that they can’t help but come back for more in the future.
The best thing about inbound marketing is that it’s very cost effective compared to traditional advertising. It all starts with your online presence.
People are spending a lot more time online right now, but there is also more competition for people’s attention. Growing a following doesn’t happen overnight. It requires a lot of work, experimentation, and critical thinking. However, if you figure out the right formula for your audience, you can reach many more prospective customers.
If you own a small local business that sells non-perishable goods in a storefront and you’re not selling your products online, now is the time to quickly pivot into ecommerce. With a service like Shopify, you could be up and running within a few days. All-in-one website platforms like Squarespace and Wix also support online sales, and you don’t have to be a web developer to create a website (just make sure you follow basic UX best practices).
Unfortunately, just having a website doesn’t mean you will show up in search results without good SEO (search engine optimization). Check out the Definitive Guide to Local SEO before launching or updating your business website.
When thinking about your marketing mix, don’t leave out video. According to Hubspot, video is still the #1 form of media used in contemporary content marketing strategies.
Additional, cost-effective marketing strategies to consider include:
Figuring out a digital marketing strategy isn’t easy or simple, but it is one of the most effective ways to successfully promote your business and increase revenue during a time when more people are spending more time on the internet.
Not sure where to start? Check out the Ultimate Guide to Digital Marketing.
4. Find New Ways to Reach and Engage Your Customers
For some B2C organizations, serving customers during the Great Lockdown has simply required a willingness to get creative with new technologies. Some gyms, yoga studios, martial arts schools, and other fitness-based ventures are keeping members active and engaged online by offering live sessions via video conferencing solutions like Zoom. Although some members will still cancel their memberships, some will opt to remain customers if they receive something of value in return.
Sometimes just being honest with members or clients and putting in the extra effort to continually deliver value is enough to keep the doors open (so to speak) until the world returns to normal.
During a time when the world is full of both uncertainty and distractions, focusing on customer engagement is more important than ever. Speaking of engagement, if you aren’t utilizing personalization in your marketing and communication efforts, you’ve already fallen behind the curve.
Already doing everything you can to engage your audience? Consider forming business partnerships to access a wider audience.
Strategic partnerships allow you to reach more potential customers by pooling resources with another business or entrepreneur that shares similar goals. Check out “6 Steps to Creating a Partnership That Drives Strong Business Growth” for tips.
5. Ask Your Customers to Become Investors
If all else fails and you are forced with the decision to close permanently, there is no shame in asking your customers directly to help keep your business from going under. This might involve a crowd-funding campaign using a site like GoFundMe or Kickstarter. However, another option is to create a membership program (assuming your customers are not already members) or a subscription program.
Your membership or subscription program should include multiple tiers or levels with increasingly better perks and/or discounts for each level. Provide a wide range of options to accommodate customers with different levels of disposable income. Some customers may only be able to contribute $5 a month, while others may be willing to contribute significantly more in exchange for a personalized and highly enticing membership package. Clearly communicate terms, such as what members will receive and the length of the membership and/or subscription.
Finally, if you ask people to invest in keeping your business going, be 100-percent transparent and honest about your financial situation and how much you will need to keep the doors open. To be completely transparent, this may require sharing some of your personal financial situation, e.g. how much salary you are paying yourself and your employees. Explain what measures you have taken to cut operating expenses and overhead. Provide regular updates on the situation so people feel in the loop and remain invested.
Visit NoCo Recovers for additional information on loans, grants, and other financial assistance programs. Also check out CSU’s Institute for Entrepreneurship to learn more about free business workshops and mentorship opportunities.