One of the magazines I look forward to reading for inspiration is Harvard Business Review. Typically, full of new strategic ideas, innovation, and best practice, it challenges my thinking and informs my consulting processes. The last issue was depressing. Its focus was on leading in a low-growth economy and covered topics like “subtraction” strategies and how to share bad news with employees. It is not that these aren’t real challenges in the business world, and economic cycles are real, it just raises the question of why we accept low growth in any economy?
Our economy right now is full of uncertainty. Things are shifting. The recent government closure created hardship and disruptions. Good investments are hard to define as historical performance doesn’t predict future performance. AI is becoming more prevalent but as yet has not replaced the workforce in any substantive way and may not anytime soon. Currency is even changing as the penny is going away. That may sound unimportant, but I have had clients that priced to the penny in highly competitive markets. Uncertainty, however, often leads to status quo and it is status quo that leads to low growth.
In every economy, there are winners and losers. The ability to win in any economy is dependent on our ability to adapt to meeting the needs of our customers better than others. What can the average company do to grow in uncertain economies?
- Have a product that solves a specific need. Zoom flourished during Covid as stay at home orders forced the workforce to connect in new and different ways. Companies that have developed omni channels of communications with customers are prepared to build stronger relationships in any economy.
- Lower priced options may be more valuable. Discount retailers like Dollar Tree or Wal-Mart tend to benefit from customers who trade down in slower economies. When Hallmark Cards was battling competitive pricing from the Dollar Store, they offered a small selection of cards at 99 cents and that made a huge difference for them (prior to the internet!). Offering a small line of lower priced items or bundling items for less than full price if bought separately, signals a respect for customer budgets. Look at Amazon Prime, Microsoft 365, Telecom bundles, or even fast-food value meals!
- Helping customers save time, especially if they are right sizing work forces, can be as valuable as saving money. How do you provide them with more support than you have in the past, which allows customers to continue seamless execution?
- Recurring revenue strategies that sustain purchases over a period of time provide customer convenience while assuring a steady flow of revenue for the provider. Streaming, maintenance and support, apps and replenishment offers are popular. They often fly under the radar during cost cuts as their customers become dependent and they are not receiving regular invoices, so they are less visible. Pre-paid maintenance packages on your vehicle, Caterpillar and John Deere have service and maintenance packages, and GE Aerospace offers “Power by the Hour” services, recurring maintenance tied to flight hours.
- Strong brands, not easily replaced, often have sustainability in tougher economic cycles. Brands that are mission critical, protected by patents, hard wired into infrastructure, or have other unique differentiation, especially for discerning customers, are an asset. Even in uncertainty, these brands should lean into who they are and not get watered down by short-term economic impact. The customers who value them may see them as a staple or even a lifeline, and raising the value delivered to those core customers is key.
Rather than seek ways to sustain, look for ways to grow, in uncertain times. When competitors hunker down or cut back, it is your time to shine with customer-focus strategies that provide more value and more seamless integration, building trust and loyalty. Want to know how your company can grow in uncertain times? Reach out and let’s look at it together.
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