Why Marketing is Integral to Surviving Economic Downturn

A few years ago, we published the blog The Importance of Marketing in a Downturn Economy, a title very similar to this one. The Oil and Gas industry had just crashed, businesses were struggling, and Alberta was in a full-blown economic crisis. Most large-scale companies in the industry attempted to survive by laying off thousands of employees, and many small businesses folded completely, regardless of industry. Times were hard, and while we may not be in as large of a crisis right now, the current state of the economy has some entrepreneurs and business owners thinking about keeping costs down.

Despite learning from the ongoing ebbs and flows of the economy, businesses always seem to fall into a pattern of cutting their marketing budgets when times get tough. While cutting excess spending to keep afloat is crucial during tough times, research (and experience) has shown us that cutting all marketing initiatives will do more harm than good in the long run. Business owners often feel marketing is the easiest expense to let go of because it doesn’t demonstrate immediate return on investment (meaning they feel the business can survive without it for a while), and it doesn’t seem as important as other factors such as employee retention and business development. What they fail to realize, though, is that ensuring that marketing stays as an integral part of the operation will pay off in the long-term, helping to save jobs, fortify your brand’s presence, and ultimately bring in new work.

In tough times, marketing is often viewed as an expense when it should be considered an investment. Maintaining a strong brand and communication with audiences sets a business up to appear strong in the public eye. During times of hardship, taking a step back to re-evaluate if your marketing efforts and brand are still aligned with your organizational goals and values will help you visualize the future rather than put out immediate fires.

Ensuring you have the right budget to continue marketing in a downtown can also help your business do a few other things in times of uncertainty:

 

Strengthen Your Brand

While it may seem like a challenging time to strengthen your brand as there is less work and, in turn, less money flowing in, think of this time as an opportunity. It is a chance to reassess your “why.” Remember what brought you into this business in the first place. Your business provides some sort of value and solution (otherwise, it’s not the economic downturn that’s causing you trouble), so take advantage of the time you have and go back to the drawing board. Work with your staff on marketing efforts to communicate to your audiences the value of your brand – showcasing who you are and what you believe in in a consistent and sensitive way.

Stand Out from the Crowd

Cutting marketing in times of hardship is a common practice. Many businesses see it as the only way to avoid complete annihilation (however untrue that may be). While everyone else plays it safe, this is your opportunity to stand out from the crowd when others are no where to be found. No matter what the situation may be, continuing to invest in marketing will appear as a sign of continued strength in the public eye. So, while your competitors are hiding, you’re staying top of mind with potential customers.

Maintain Transparency

We often say that people do business with people. With so much choice and information out there, consumers, whether B2B or B2C, are looking to do business with brands they can trust. Continuing to support marketing efforts while your business lays off valued employees and loses business may seem like poor optics, but in fact, it’s the opposite. Being honest with your audiences (both internal and external) and showing that you are still thriving despite setbacks shows strength, and during times of crisis people are looking for signs of strength.

Your business will take a hit in an economic downturn – that is inevitable. The key is to not succumb to fear and go into panic mode. Understanding the benefits marketing is bringing to your business will allow you to reassess its importance. Marketing is integral to survival, but it is likely you will need to reassess your spending to become even smarter about your marketing efforts, enabling you to adjust as needed. However, identifying where to allocate marketing costs effectively is not easy. Luckily, we’re experts. We’re here to help you in your time of need and find the best way to bet your brand out into the open without losing it all.

Need a hand? Give us a call.

Energy Series – How to Get Potential Customers to Notice You

The energy sector is Canada’s beating heart. While being a challenging industry inundated with competition, significant opportunity exists for business. To not only survive, but excel, brands must shift their way of thinking in order to stand out from the crowd. But how?

Whether you’re targeting B2B or B2C consumers, here are five ways to get potential customers to notice you.

  1. Have a Stand-Out Portfolio

Your portfolio should tell your brand story, describing the “why” you do what you do and “why” you are the best at doing it. A good portfolio includes an “About” section (your brand story), samples of your work, testimonials from past clients, and how to get in touch with you. Features of your work from a range of different clients should be the primary focus of your portfolio, and should be chosen based on the audience you are trying to attract. It should define your strengths, and follow suit with your brand both through language and stylistically.

To build the best portfolio, do research on your target audience. Understand their drivers, motivations, what they value and what they don’t. Cater your content and projects to them. Do you have both B2B and B2C clients? Multiple audiences mean multiple portfolios and sell-sheets specifically tailored to that audience. One size does not fit all.

Having both an online portfolio as well as physical copies allows for increased visibility. For online portfolios, you can use Search Engine Optimization (SEO) so that when consumers search for something related to your business, product or industry, your company name will be ranked higher in the search results. Be sure to have something impressive and relevant for them to look at when they find you!

  1. Be Social – Use Social Media

Get on consumers and clients social radar – how can they choose your company if they do not know who you are, what you sell, or why you’re the best choice? Social platforms and energy news platforms allow you to target content specifically for the audience you are trying to attract. You can also decide exactly which platform to use based on who you’re targeting and which platform they are the most active on.

Social and energy news media offers unparalleled access to target audiences and decision-makers on their own terms, and on platforms of their own choosing. And guess what? They appreciate that. They also like when your social activity is an authentic representation of your brand, is honest, and is human. Know your audience, their interests, values, lifestyles and aspirations, and play to them. Whether it be sharing a relevant article, or just commenting on last night’s hockey game, communicate and encourage two-way dialogue. In all your communications, remember to explain the “why” of your brand and to share your story in a relatable way. While being social on social media is likely not going to close any major business deals as that will likely require face-to-face interactions, it will get your foot in the door and keep your “brands” in front of  people.  Out of sight….means out of mind!

  1. Network, and get Face-to-Face

Face-to-face conversations are the comeback of the business world. You will not be able to close any major deal without some sort of face-to-face interaction, be it at a networking event, tradeshow, community volunteering, client meeting, or so on.

Some of these events are likely to be outside of business hours, so be prepared for that. At the very minimum, invest your time and attend at least one after-hours industry-related event a month. While you may have business representatives for these sort of events, it never hurts to have high-level management present at important speaking engagements or conferences. Ensure that whoever represents your brand is fully aware of your products, services, and what is included in your portfolio and sell-sheets. They will be the human depiction of your brand, and will leave a lasting opinion in the memory of consumers and partners alike. Be sure they’re the right fit.

Fill up your tank, get business cards printed, have your impressive portfolio on-hand, and get ready to go full steam ahead. Networking and being present is a sure way to get noticed, and be remembered.

  1. Create a Common Enemy. Be the Solution, and Incentivize

Let’s first define the term “enemy.” Your common enemy is not a competitor, but rather a common problem that your target audience has, and one that you have the solution for. For example, think of early Apple advertising which considered PC as the enemy. Apple marketed themselves as partnering with consumers to solve any identified PC defects to create a better tech experience. Or, think of automotive companies which classify bad weather or the winter as the enemy, identify their product as the solution, and encourage consumers to unite with them to fight this enemy.

Ally with your target audience to unite against a common enemy. If they see the relevance, they will get fired up to purchase your products or services. It’s important to be extremely cautious when determining your common enemy. Do not relate it to politics, race, religion, gender, or other sensitive topics, as this could cause people to dislike you and your brand.

Instead, locate your clients weak or sensitive points, and use them to come up with your enemy. Create a sense of urgency and make a case for why this enemy is a problem that needs fixing quickly (i.e. winter is coming). Be and offer the solution, and incentivize these value-added services or products to inspire quick action. If its relatable, it’ll be sure to get you noticed.

  1. Invest in Your Brand – Invest in Marketing.

Nothing promotes growth quite like effective marketing. Depending on your target audience, you can differentiate your brand and gain a significant amount of attention if you base your marketing on the right strategy. Tactics compliment strategy, including social media advertising, SEO, radio ads, digital marketing, print collateral, or any combination thereof. The use of marketing tactics such as blogging can also help humanize your brand which helps distinguish you and make you more relatable. If your business looks attractive and is being promoted correctly, there’s a much higher chance that more people will walk through your door or reach out.

Your time, effort and investment in marketing can help you outshine your competition, build brand equity and enhance your overall reputation. In truth, an investment in marketing is an investment in your brand, and one with a high ROI if done properly. Even a moderate marketing budget can make a world of difference when it comes to getting your brand noticed.

Get going, and get noticed.

Energy Series – Don’t Fall Victim to These Social Media Fallacies When Promoting Your Energy Business

As social media madness continues to progress, the phenomenon has acquired a bit of a reputation. Companies operating in highly regulated industries like the energy industry often perceive social media as more of a risk than a strategic asset, with its dynamic and fluid nature seeming like more of a legal or PR nightmare waiting to happen. However, energy companies need not fear. Like most presumed reputations, not all the assumptions are exactly accurate, and with a thorough strategic plan, companies can harness the power of social media to attract, compel and have conversations with their audience.

Understanding social media and its challenges is essential to conducting yourself appropriately and not wasting valuable time and resources. Read on to ensure you don’t fall victim to some of the most common social media fallacies.

1 – It is not free. Yes, the download and sign-up are free, but that’s where the gravy train ends. In order to use social media properly and for the best return on any investment you will need to devote something integral into it – some time. No one ever got into shape with a gym membership by not showing up to put in the work.  You will get out what you put in.

And as we all know, time equals money. Businesses which think they can just sign up, post a cookie-cutter post once in a while and expect miracles to happen are bound to be faced with a social media-tinged reality check when they realize their number of likes and followers are consistently staying in the single digits. Each social media platform has best practices associated with it, and it is important to familiarize yourself with them before embarking on your social media mission. Posting spam to Facebook, not interacting with other users consistently on Twitter, posting the same pictures of you equipment working on Linkedin simply due to a shortage on time, are all social media faux-pas that businesses should tenaciously steer clear of. 

2 – It is not just a marketing and advertising tool. Social media is a method of communication, a tool which enables us to connect with humans from all walks of life, humans whom business giants would have previously not been able to reach directly on such a large, yet still intimate scale. Human connection is a breeding ground for loyalty—the holy grail of branding. Human beings want to be acknowledged, validated and seen. Social media is a bridge between your business and its customers, and it’s not a second or third-degree connection, it’s a direct overpass. GoPro, a wildly successful manufacturer of action cameras, is an example of using social media to build connections with its customers, and thus, brand loyalty. By using the photo-sharing app Instagram, GoPro shares daily pictures with its 9.7 million followers, submitted to it by consumers who have taken their photo with the GoPro camera. This user-generated content is completely free for GoPro, allows it to recognize and celebrate individual customers, while still promoting its business and product in an authentic manner.

3 – Contrary to popular belief, your business should not utilize any and all social media platforms available. There are currently dozens of social media apps offered to businesses, but social media is another case of quality versus quantity. When writing the social media strategy for your business, decide which platforms or apps are the most in line with what products or services you are offering. For example, a landscaping company may decide to target Instagram and Houzz (an online community which shares architecture, interior design and decorating, landscape design and home improvement) as these apps will allow the company to share photos of their work. Twitter, which is based on short, 140 character messages, is likely not a medium the landscaping company should focus it’s time, efforts, and money on, and instead stick to apps which are comprised of more visual content.

4 – You’re using Twitter, Facebook is your friend, and you even have Instagram and Linkedin running somewhat smoothly – shouldn’t you be good to go? Unfortunately, you will likely never be completely free to rest on your laurels. Social media is constantly evolving and spawning new, unique platforms, primed for businesses to realize their potential power. In addition to the above social media platforms, energy companies will also want to use platforms that are focused on their specific target audience. In Canada, in particular,  EnergyNow.ca is one of those platforms that not only delivers energy industry news, data and events on a daily basis, but their platform also strategically markets the products and services of energy companies as well…very effectively.

Currently, the mobile app Snapchat is cited as being the fastest growing social media platform, with over 100 million active users, and increasing at a rate of 8 per cent, while other platforms have remained stagnant, such as Twitter, which has not grown in number of users since 2014, according to a survey from Harvard University’s Institute of Politics. If you, like many, are lost on how to effectively use the app, which allows users to share photos and videos which can either “self-destruct” after ten seconds or be pinned to their “story”, which disappears after 24 hours, simply do your research. Keeping up to date on the social media trends and emerging technologies will allow your business to get an edge on the new platforms and with that, create a link to the growing audience of millennials, if that’s who you’re targeting.

The bottom line is that social media has taken on this fluffy reputation, a reputation which precedes it as being easy to manage and needing little time or effort in order to maintain. Of course, you could treat your business’s social channels with those kind of kid-gloves, or you could recognize that these platforms are a direct link to your customer that should be strategically handled with the utmost professionalism and care. As an energy company, you need not be afraid. By understanding common misconceptions and taking advantage of social media, you can successfully take advantage of opportunities and possibilities that other channels cannot offer.

Energy Series – How to Determine Your Ideal Marketing Budget

Energy companies without a marketing department or executive level marketing staff member too often arrive at an annual marketing and sales budget by determining how much the company can comfortably afford, subtracting sales person salaries, and then revising that figure downward to make it more palatable to the Owner/President/CEO. While some understand that marketing plays a vital role in empowering a company to meet its objectives, others do not, and do not spend accordingly.

But if not based on affordability, on what should one base a marketing and sales budget?

Company Objectives: You can also set an optimal marketing and sales mix based on a sound strategy to achieve certain objectives. This approach requires that experienced marketing and sales managers create a Marketing Communications Strategy that is designed to accomplish the company’s targets and objectives. The plan must include detailed tactics with associated costs. Those costs are then totalled, and that figure is the required budget.

Percentage of Revenue: The time-honored method of setting a budget is to base it on a percentage of historical or projected revenue, which is a common top-down approach. Revenue is a result of marketing and sales, so not spending enough on it hampers a company’s revenue generating potential. Few small to medium-sized energy companies (1,000 employees or less) spend this large of a percentage of gross revenue on marketing. Still, companies need to leave room in their budgets for marketing and should spend between 1% and 5% of gross revenue on marketing, depending on industry maturity, reputation, customer churn, and level of competition.

Volume: Another means of determining one’s marketing budget is to calculate what the cost of marketing and sales is for each unit of the product or service to be sold, not to be confused with cost of goods sold, and then to determine the expected volume of sales. This is a variation of the percentage of revenue method, but it frames the budget in a way that focuses on units of sale. The limitation of this method is that without accurate historical data it can be difficult to determine the cost to sell each unit. This method is excellent for companies that are limited by production or service capacity.

Competitive Parity: This approach is based on competitors’ marketing and sales spends. Simply look at what a competitor of around the same size is spending on marketing and sales, and spend the same. This on its own is rarely an efficient strategy as companies’ have different marketing and communications strategies, resources, and situations. It can also be difficult to obtain information on competitors’ marketing spends.

Many successful companies will cite 10% of annual revenue as the prevailing wisdom, but the truth is that the amount companies spend on marketing and sales varies greatly depending on their industry, service type, stage of growth, and competition, among other external factors. Specifically, in the energy industry, B2B companies have elaborate and extensive sales functions that require strong direct sales representatives whose salaries range from $100,000 to $300,000+ CAD. This is critically important for Oil and Gas companies in Western Canada and the United States, where deals often go to the firmest handshake.

For most energy companies to be competitive, they should spend at least 7% of annual revenue on marketing alone, including planning, digital marketing, brand upkeep and strategy, and advertising, among other marketing initiatives. A company that makes $100 M annually should spend around $7,000,000 on marketing to be competitive. One that makes $6 M annually, should spend at least $420,000 to be competitive.

Regardless of which of the above methods your company chooses to determine its marketing budget, it will likely be limited by available funds, regardless of its needs, objectives or how much revenue it is expecting to make or has made. Limiting factors are a fact of life, but particularly in the highly competitive Western Canadian energy industry, you cannot forget the link between promotion and revenue. A budget should be determined by following an objective, well-reasoned process that makes available the resources your company needs to succeed.

Stampede Marketers, Where Art Thou?

Get your cowboy boots, hats, and sunscreen ready, because Stampede season is here!

While the Calgary Stampede is a summer event that Calgarians (and especially us here at WJ) anticipate, there is a noticeable lull this year. Have you felt it?

In 2012, Calgary celebrated its 100th Stampede, and the city was packed with stampede-themed advertisements, decorations and, of course, parties. This year, though, we’re not seeing the same level of Stampede advertising (even the coveted Cowboy’s Stampede party isn’t sold out yet). Although the economy is slowly starting to get better here in Alberta, there appears to be less participation and less marketing from local businesses surrounding the Stampede.

While this is to be expected, we’re here to tell you that the value of marketing and demonstrating your commitment to the community in which you operate cannot be underestimated. In times of economic downturn, the concept of community is more important than ever. While consumers are spending less, communicating the idea that “we’re in this together” can help relate you to your target audience, who will subsequently develop a positive connection with your brand.

This is especially so during the Calgary Stampede – an event which only four years ago brought Calgarians together in a strong, emotional and unexpected way during the chaos and stress of extreme flooding. While spending capital on marketing may seem like it will cast a negative light on your brand, especially when falling oil prices have affected our city so greatly, it’s understandable that you’re cautious; however, a little can go a long way in terms of marketing.

Not sure what to think? Here are some things to consider:

Your brand is your most important asset

Your brand is one of your most valuable assets. Organizations which support efforts aimed at improving their brand and reputation are the organizations which are the strongest (and come out with the highest profit margins, even in a downturned economy).  Recessions don’t last forever, and businesses which recognize this fact and think long-term are the ones which succeed. What does that mean for you? Spending capital on improving your reputation and ensuring your brand is strongly represented amongst consumers and the community is not a waste of money. An investment in marketing is an investment in improving your brand equity, and that is just smart investing. See our previous blog on reputation versus brands here.

While your marketing budget may seem like an easy cut, consider this: a cost-cutting analysis of 1,000 firms during previous economic downturns produced by PIMS (Profit Impact Marketing Strategy) found that the most successful firms cut costs in manufacturing, administration, and spare capacity, and those that cut marketing budgets take a much harder hit profit-wise. Research conducted by AdWeek in 2009 similarly found that firms which cut marketing budgets during recessions saw sales fall anywhere from 20-30% over the following two years as a result. That’s a major loss.

Don’t make it about you – make it about them

While you may not have the marketing budget you once did, consider shifting your focus to your consumers who are also affected by the economy. For example, when do you think Calgarians most need your positivity, support and community involvement more than right now?

This doesn’t mean that it’s time for a big budget, flashy billboards and an aggressive social media strategy. What it means is show that you care, that you’re in it together and, most importantly, that you’re willing to show up for them. In other words, make an emotional connection between your audience and brand by playing a part in local and community-driven events, such as the Calgary Stampede. As AdWeek puts it, “word of mouth is a powerful amplifier”, and showing support for your community can build an emotional bond between your brand and your consumers, get mouths moving, and help to improve your overall reputation.

Maybe the economic climate means that you can’t sponsor as big of a Stampede pancake breakfast as you once did; however, there are still ways to add value. Consider how you can save consumers money or time, or think about showing your employees how much you appreciate their dedication by sending personalized thank-you’s for all of their hard work (they are your biggest brand ambassadors, after all). Of course, this advice can be taken into consideration for any relevant community-centred event, not just the ones that involve plaid, short-shorts and cowboys.