Down But Not Out

Professor Georges Knell’s 10 Tips to Boost Profits

In response to plummeting economies, the world’s leaders have responded. US President Barrack Obama injected $750 million into the American economy to boost activity. Hu Jintao of China, invested almost a $1000 billion into the Chinese economy to build and create jobs. France’s President, Nicholas Sarkozy, invested in new technologies and small businesses.

What can we learn from these leaders?
You need to spend to boost activity. And marketing budgets should not be reduced too harshly.
Nevertheless, marketers typically see their budgets dwindle when times are hard because marketing budgets are often calculated as a percentage of future sales. So when sales go down, so do budgets.

It is important for marketers to react by refocusing their activities and finding new ways to create value and maximize return on investments (ROI). They must show that, more than ever, ROI is at the top of their agenda.
As companies tread through tough times, we present:

10 Tips to Boost Profits:

1. Pareto principles always work. Focus on your key clients who bring most of your turnover. Don’t let them down.

2. Create new incentives for your loyal customers to consume more. It costs six time less to keep an existing customer than to win a new one.

3. Focus on today, leave expensive innovations for better times.

4. Negotiate better with your suppliers, but don’t squeeze them. They need you and you need them.

5. Work closely with the Finance team; you will gain in credibility and efficiency.

6. Make sure you calculate clearly how every dollar spent in marketing will bring in sales.

7. Reinforce your key brand. In periods of uncertainty, people like to be reassured by their favorite brands.

8. Have your Key Performance Indicators and scorecards ready to remember what counts.

9. Drop campaigns that are just about awareness and not sales.

10. Most importantly, remain confident and stay positive.