How small business owners should adjust budgets during tough times
There’s a saying “tough times don’t last, but tough people do” … never has this been more poignant than right now. Nobody will go unaffected by this virus, and if we’re all honest with ourselves, we will admit that we’re all a little uneasy. Even if you’re fit and healthy and pretty sure you’ll fight it, you’ll have the financial impact to worry about.
I have many stories to tell you about this new virus – from my travels to my own health. But I’m here to be proactive, so let’s talk about how your business can survive this unpredictable time.
I use the word unpredictable strongly because it’s just that. Nobody has faced this situation before, so all we can do is take one day at a time and keep a level head. While none of us have the answers, a bit of logic can go a long way.
As a small business owner, your first instinct will be to panic and cut outgoings. Cutting unnecessary outgoings such as those rarely used subscriptions is spot on… do it! We could all do with a little housekeeping now and then. However, if one of the outgoings you are considering cutting is your marketing – you might want to think again. This is a bad idea because right now you’re going to need all the leads and sales you can get. Cash flow is crucial to you.
Here’s what you should do instead:
Reduce your marketing budget for brand awareness. All that matters right now is cash flow so move all your budget to where your cash flow can be improved.
Stop all testing. Carefully analyse all your past data and only focus on what works. Whatever tests you do right now will not give a true figure, it’s all messed up.
Focus on ROI. If you knew your cost per lead/conversion before all this, then you’re in a stronger position. It may go up a little but at least you’ll know where you stand and how much you can afford to spend per lead/conversion.
Prepare to get creative. Your customers persona has changed, how you get them to connect with your product/service has changed. They have other things on their mind – so you may have to revisit your marketing persona strategy.
If you rely on local business, then be prepared to turn to social media to let customers know that you understand their fears. If you’re a tradesman, you can explain that you can quote a landscaping job for example without meeting them. Even if you’re not worried, they might be!
Only focus on what works is the key here.
Above all else, don’t panic. If you panic, you’ll find that you can make a decision that will have a negative impact on the future of your business that extends well beyond this difficult period.