This downturn has forced customers to rethink their expenditures. This is pushing many companies, services and products into the Marketer’s Gap of Despair.
What is the Gap of Despair? It’s the terrible place you end up when your product simply isn’t enough.
Isn’t cheep enough, good enough, needed enough, wanted enough. You get the idea.
During a downturn it becomes more likely that your product or service will fall into the Gap because customers are paying more attention and spending less. Convenience means a bit less, unused features don’t cloud the decision making process, and NEED outweighs WANT. (A picture of what this looks like is at www.frogblog.biz.) Products are judged on a scale of need vs want and utilitarian vs feature rich.
The Gap affects companies large and small. It is always something to be avoided, but in a recession it is deadly.
So, what is a small business to do if they find themselves trapped in the gap?
First: Assess yourself, your direct competitors and products/services that are different, but still can replace you. (For example – if you are a restaurant, the grocery store – if you are a dry cleaner, ready to wear clothing – if you are a furnace repair shop, DIY)
Second: What can you control? Price is often the easiest, but can be the most destructive. What about product mix, sales area, marketing? Can you split your services into smaller chunks? Can you add services that push you in a natural direction without necessarily adding cost or price? Is your product something that meets a sustaining need, an investment, a guilty pleasure? (Restaurant. promote Dessert and Coffee only option – dry cleaner – laundry by the pound and delivery – furnace repair, workshops on service.)
Third: Survive or Get Out? If you entire product category has fallen into the gap then the category will shrink. Can you survive longer than your competitors? Can you buy your competitors? Can you grow into a different category? This step is the most unpleasant to think about, but critical. Those with funds to survive will pick up the remaining available business.
So, evaluate your business and push it away from the gap. This doesn’t always mean lowering prices, but sometimes it does. This in addition to the social marketing you should be doing will help improve your businesses health.
Fred H. Schlegel is a marketer and writer at http://www.frogblog.biz