Happy Birthday Little Recession…
Hooray! Happy birthday to the recession! We’ve recently passed the one-year mark since the official crash and resultant “little” recession. How did you celebrate?
Actually, it hasn’t been just a little recession, has it? It has been, and continues to be, a big recession. A devastating one for many people. Unemployment at higher levels than it has been since the Carter administration. And this despite record low interest rates, that you would think should stimulate the economy and enable people to hire, make capital purchases, and grow.
But it ain’t happening. The stimulus hasn’t stimulated and we remain in an economic malaise.
Of course, I recognize there have been some positive economic signs of late, but many indicators suggest – and many pundits agree – that with what’s on the horizon, the recent positives amount to a dead cat bounce, and, while the downward trends may be leveling out, they have not bottomed out yet.
I suggested one reason why we’re at a standstill in my recent post on Political Paralysis. Those conditions still exist and I suspect they will continue for some time. There are other challenges, most of which were either directly or indirectly caused by government, and we the people, buying in to the “sugar fixes” our elected officials have given us over the years.
But I don’t want to talk about any of that. I want to talk about the people who have chosen NOT to participate in the recession. Common, ordinary, low-tech businesspeople, in common, ordinary businesses, who have quietly plodded along and had the best years of their careers in the last 12 months.
Let me talk about three plumbing and heating contractors. One located at the crossroads of the west, in Salt Lake City, one located in near-depressed Ohio, and one on the east coast, in the Wilmington, Delaware/Philadelphia area.
Kent Whipple is the owner of Whipple Service Champions in Salt Lake. Over the last few years he has grown his business into the largest residential plumbing and heating company in his marketplace. He hasn’t done it by acquiring other businesses. He has done it by simply growing his own.
Kent may not admit it, but I believe his success comes from smart marketing. Here is what he has done…
- Established credible points of difference in the services he renders and the way he renders them, between himself and the competition. (Yes, there is an operational aspect of this, but the decisions on differentiation are primarily marketing driven.)
- Made sure his technicians are all trained, not only in technical competence, but also in providing an exceptional experience for the customer. And that includes at least attempting to solve ALL of the client’s plumbing, heating and air conditioning problems in one service call, and setting up systems to economically PREVENT problems in these home systems in the future. To do this, his technicians must have systems for selling and know how to use them.
- Priced his services commensurate with the value being rendered. Kent is not the cheapest plumber in town. But his pricing if fair, when considered in the light of the exceptional services he provides. And unlike his competition, by refusing to compromise his pricing, he has insured enough profitability to STAY in business, while so many of his competitors have low-priced themselves right out of business. How does that serve the customer, either now or in the future?
- Kent continues to market and advertise. He hasn’t backed off because of the recession, as so many of his competitors have. By continuing to market aggressively, Kent has poised himself to be there when competitors fail. This has allowed him to grow right through the recession, and positions him for explosive growth when we finally turn this thing around. He’ll pick up all kinds of market share that has been abandoned by fallen competitors, and even those who have survived but have failed to maintain their spot in the market, because they cut their advertising.
Bill Blind (pronounced with a short “I”) of Blind & Sons Tri County in Barberton, Ohio provides plumbing, heating, electrical and air quality services to the greater Akron area.
Of course, Ohio is one of the most depressed economies in the nation, a big issue of which was made in the last election. But Bill hasn’t bought any of it. That doesn’t mean he hasn’t made some adjustments.
“We’ve gone back to the basics… the fundamentals,” he told me. “We have our entire staff focused on billable hours, and we’ve established a way that staff members can be rewarded for helping to generate more billable hours, in the customer’s best interest.”
In other words, Bill has his plumbers recommending clients get their heating and AC systems checked, electricians recommending air quality inspections, and so forth. There is no better way to grow, especially in a recession, than getting more sales and bigger sales from your existing customers.
Mark Aitken runs Horizon Services, headquartered in the greater Wilmington, Delaware area, and serving both that area and Philadelphia. Mark’s story is, perhaps, the most dynamic of the three. When Mark and his partner Dave Geiger first enrolled in my Principle-Centered Marketing Coaching™ program a decade ago, they had already grown their business from under a million dollars to nearly five million, in just a few years. Since that time, they have grown it to nearly 34 million with average growth rates close to 20% a year and sometimes substantially more.
Mark tells me that so far this year leads are up nearly 30%, and while closing rates are down a bit and so is the average transaction, that huge increase in leads means revenue is actually up 12% and profitability is also up over last year.
Mark has actually increased his marketing budget from 5% to 7% of sales. That’s about a 30% increase in actual advertising expenditures. (Interesting that leads have increased at about the same rate as his ad budget.)
Mark also says a return to fundamentals and an exceptional emphasis on training his people to sell is at the heart of Horizon’s success. And he does think that his increase in marketing while others are cutting and then failing, is bring abandoned clients his way.
So again the question, how are you celebrating the birthday of the recession? Are you fretting, cutting, operating out of a scarcity mentality? Or will you simply choose not to participate.
THE END
EDITOR’S NOTE: Jim Ackerman is a Salt Lake City-based Marketing Coach, Writer and Marketing Speaker. His new book, How To Market Your Crap When the Economy is in the Toilet, contains 12 vital strategies for unclogging the American economy, one business at a time, and is now available at a discount directly from the author. Contact Jim at 800.584.7585 or go to www.marketyourcrap.com.
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