Preparing for an Economic Downturn (Part 2)
Know Thyself – Know Thy Customer / Stay in Your Lane but Diversify
NOTE: As I explained in my first article on this subject, this was written back in February prior to the global impact of COVID-19. It’s amazing to read now, in light of our current situation. Below, I use the example of Chick-Fil-A as I talk about diversifying within your niche, but now we’ve all seen such rich examples of this from organizations across America, like LL Bean, who matched their niche (no, not clothing … sewing!), and applied the pivot, turning their sewing machines into weapons on the unseen enemy by making masks for workers on the front lines. That is a company that knew what they did well, stayed in their lane, and successfully diversified during difficult times!
In my last article, I encouraged you to get clear on your vision in order to help your team stay engaged. Now I’d like to focus on your customers. It’s time to define your niche, determine your lane, and press hard into it.
As the economy weakens, many organizations will try to drum up business from sources they previously hadn’t. That’s good … and bad. I’m all for diversification, don’t get me wrong. And I love the concept of the pivot, where we, as business leaders, shift to ensure that we not only survive, but thrive as the economy struggles back to health. That’s the very heart of entrepreneurship! But, too often, our reaction is more of a panic, as though we’re barely treading water and fear that we’ll drown at any moment. When we react that way, it’s not pretty.
Instead, you must be proactive and consider your niche – your sweet spot – the place where you’ll live as an organization. Identify the thing or things that you do well, and firmly place yourself in that space. While it may feel like that’s limiting, it’s the opposite! Instead, you’ll find that you will be firmly anchored in what you can succeed at. Then you can figure out how to diversify based on your strengths and who your audience may be.
Work to answer the question, “Who is our ideal customer?” What’s their demographic (who they are), geographic (where they are), and psychographic (how do they think)?
From there, consider who ELSE might need your product or services. Is there a population out there that you’ve not recognized previously as a potential customer? Consider which companies and industries might have money during a recession, including a look at regulatory requirements for other industries that will mandate that they meet certain standards to stay in business, and consider how you might sell to them as well. Just don’t forget to stay in your lane while you’re looking for that new customer base!
Let’s get a better understanding of where this does and does not take us.
Chick-Fil-A does chicken. Only chicken. They decided early on that their chicken recipe was the bomb and that they wouldn’t sell beef or pork or even tofu, but just chicken.
There are all kinds of options when you visit their restaurant, including salads, sandwiches, grilled chicken, fried chicken, and even some sides. But they have remained true to themselves, selling what they consider to be the best chicken in the industry. If you’re hungry for a burger, you won’t go to Chick-Fil-A. But if you’re plain old hungry for great food, or fast food, or even great service, you just might hit up your local Chick-Fil-A. This means that their target market is people that are in the mood for a great chicken breakfast, lunch or dinner. Or perhaps even a snack. See, just because they decided who they are (chicken!) didn’t mean they could only sell one kind of chicken. It just meant that chicken is what they would do REALLY WELL.
All that said, once you’ve identified your niche, now it’s time to reach your audience, creating your own voice and tone, so that customers feel who you are. So that your words ring true evoking a confidence in your product or service when things are turbulent. Just like the afore mentioned Chick-Fil-A, who developed a fun message with a cow holding up a sign saying, “Eat mor chikin,” you’ve got to develop a strong, concise marketing message that resonates, using words and phrases that are uniquely you, bearing in mind that you’re not intending to reach everyone, just your specific audience.
While times are tough and the economy has taken a hit, this isn’t the time to throw in the towel. Some of our greatest organizations are run by leaders who learned their greatest life lessons from a failed business, a bankruptcy, or during a time when they struggled the most. Success is most often born from adversity. So, let’s learn, and emerge stronger!
Up next, in my last article of this series, I’ll focus on running lean and smart, and ensuring that you’ve got the right people on your team.
About the Author
Kirsten Smith, founder of Made to Thrive Consulting, is a business management strategist and EOS Implementer. She has over 20 years Business Development and Management experience with small and large organizations alike, including those listed among the Fortune 500. She is considered both a business professional and motivational speaker covering a range of topics including attitude change, effective sales techniques, customer service excellence, and personality profiling. Her passion is helping entrepreneurs and leaders be the very best version of themselves and to do more than just survive … THRIVE!
Contact Kirsten at ksmith@ThriveEOS.com.
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