Rebooting your Business After Slowdown or Shutdown
Using a Digital Tool Kit to Bounce Back
2020 presents a new challenge for many businesses of every type and sector. Many businesses are severely damaged after weeks or months of shutdown or near shutdown.
Cash flows and working capital are depleted, customer demand and confidence has dissipated, and employees and suppliers are disconnected. Confusion, uncertainty, scarce resources and fear are the playing field on which we have to bring our businesses back to life.
There are many questions in every business manager’s mind about how and when we will emerge from the economic crisis resulting from the Covid-19 pandemic.
Right now, each business owner and manager should be planning to recharge their business, and to reconnect with employees, suppliers and financial partners. Most importantly, this must be done with a keen focus on capital conservation…one more than just being stingy, it must be creative, and effective, with every investment yielding a significant, reliable return.
At Roxiticus Ventures, we are now applying the same capital acquisition and allocation strategies for businesses trying to bounce back as we would for a business just getting off the ground the first time. Business managers trying to “reboot” their business have many of the same issues to address as would a start-up. Many have bigger problems, high cost structures or debt service, supply-chain and trade credit issues and many of these do not afford the luxury of time.
Every business should be working right now to recharge its re-entry into the market, and every business manager must understand that the market may have dramatically changed. Your reentry business model and plan must be prepared to address a “new normal” when you open the doors.
How can you plan now when there still are so many unknowable, but vital bits of information needed to make every decision?
It may seem that your business is in “no man’s land” when it comes to decision making, but standing still and waiting to flip some imaginary switch to turn your business back on is not going to work.
You will be hearing the term “AGILE” a lot. The luxury of time, usually on the side of mature businesses, is no longer available to most businesses. “Agile” is a term widely used in technology development now, but it will must also be applied to the management of every business and every function as we all work to reboot the economy and restore our business to some kind of new normal.
Every business owner and manager will now have to reassemble its team, replace some of the team members lost to other endeavors or worse, to re-train, re-motivate, and to restore team and supply chain confidence in your organization.
Here’s where to start:
Revisit your mission and your business plan
Together with every one of your constituencies, you should start by revisiting your mission. Do you have to reconsider how you will serve your customers in new ways? Ask customers you know and trust how they see their world changing in the next few months and years. Ask your team for their thoughts. Remember you are in business to serve customers and to meet their needs. If their needs change, so too must your business change.
Rethink your operating model
How you operate your business also has to be revisited, as does your cost and revenue model. Think about your facility. Will people be afraid to eat at your restaurant or shop at your store, visit your theater, ride in your vehicles? How can you assure people that doing business with you is safe? Do you have to assume that more consumers will want to purchase your products on-line? Can that be done? Is there another way to deliver your services while maintaining a comfortable social distance? Are your suppliers still ready to provide what you need? Can they continue to offer you the credit terms you need to run your business? Do you have to ship or deliver more? How will that affect your costs and pricing? Gather information, make some new assumptions based on what you’ve learned and begin reacting to those assumptions, right now.
Reinvest in customer acquisition and engagement
For most businesses, reducing costs and managing cash flow and working capital will continue to be a priority and focus, but for every business, marketing and customer re-acquisition must remain a top priority. You cannot just cut your spending to succeed, you must restore and regrow your top line and secure your margins.
While it may sound impossible for a capital- and cash flow- constrained business to reinvest in customer acquisition and marketing, you must be creative in re-engaging with your known customers and a consumer who may be looking for a provider that is addressing their needs in a new way.
You must: Stay active, anticipate, but be agile and ready to adapt to change quickly. You must be creative in the way you re-engage customers, while at the same time learning how to work within the limits of your available capital.
React to your “new normal” with a new approach
Many business managers may just restart or continue traditional and previously dependable operating and marketing methods. These business owners will hope that those “old reliable” methods will work again as they did before. No doubt some of them will…but the “new normal” will require adapting to a fluid and rapidly changing market place as businesses and consumers redefine their lifestyle choices, change the way they interact with others, manage their priorities and work through the post-crisis stress that has changed all of our lives. Every customer’s savings and disposable income equation has changed.
As a business manager you can be sure that every one of your competitors is working to get (your) customers and rebuild their businesses too. You will be competing with many savvy and creative marketers who have learned how to address new consumer needs and demands, and how to formulate and present new and differentiated value propositions, to a market place seeking a new sets of relationships. Many of those businesses with which you compete will be willing to invest a lot to re-connect with their customers, and to acquire new customers, including those that have drifted away from your business.
Be prepared to change your offerings, your facilities, and attempt to address new social norms. Rethink how your value proposition will need to change as customer needs and government regulations dictate. Research what your competitors are doing. Look at their web sites, publicity, marketing, and social media posts frequently.
Those business managers who understand how to use technology and to remain AGILE to effectively navigate the changes in the economy, market, and social behaviors, and to make adjustments in real time, will be more likely to engage the right consumers at the right time with the right value proposition and create a relationship. They will do so before you even determine what to do to communicate to that consumer if you are using traditional marketing tools.
Many of your competitors have learned to more effectively hyper-target potential customers in real time, using information assets more effectively and making decisions instantaneously based on that information. Those able to react to changes, get real time information and interact with consumers as individuals will have a distinct competitive advantage in their ability to target and convert consumers to loyal customers.
They have already moved to change their use of web sites, email marketing, social media posts and search engine retargeting. (You should be too!) Many businesses have already shifted to ecommerce or on-line versions to support the changes in their business. They have already moved from targeting using third party information to retargeting and hyper-targeting using first party, person-based, real time interaction. They have addressed near customer concerns and are working to establish a new trust bond with their (and your) customers.
In order to effectively compete in this new arena, to get a new and higher ROI on customer acquisition and reacquisition budgets, and to regain competitive advantage, you too must transition to digital communication models and digital marketing methods to engage your customers and acquire new ones.
Move beyond traditional demographic, behavioral, or geographic market assumptions. Rely less on information gathered by third parties to target prospective customers. Shift to retargeting and hyper-targeting: identifying individuals using first party information to engage with each unique individual based on the direct interchange of information.
You should be ready to accept that advertising agencies or media outlets, once the right adjunct to your business, must be replaced or at least augmented by technology companies who can enable you to hyper-target and interact in real time, rather than take you out to launch and present new creative ideas for a TV, radio, print, or outdoor campaigns and charge you to run a campaign next month. You need tech geeks not Mad Men. You need to have as part of your team people who know how to use computers, huge amounts of data gathered in real time, machine learning, and artificial intelligence to navigate the new marketplace operating and changing in millisecond intervals, not with one-week deadlines. You need to change marketing tools with customer interaction capabilities and you need to “own”, not share the interaction with a potential customer.
Without using the traditional one-size-fits-all marketing approach, each business can quickly and effectively leverage the growing digital marketing playing field to re-engage, re-connect customers and foster a renewed customer loyalty, one customer at a time, with extremely high frequency.
Using a technology-enabled marketing model to recharge your business begins with a reassessment of YOUR new normal. Traditional models and assumptions on which you have operated your business have to be reimagined, and you must reassess every aspect of your business including the marketing models that had proven to be reliable “B.C.” (Before COVID).
You should NOT assume you are just turning on the lights and going back to business as usual. The market has changed and so must your business.
Reboot your business – summary
- Start with a new plan!
Rethink what you business plan would be if you were restarting a new business knowing what you know now, and starting in the position you expect to be in the next few months. Here’s your chance to streamline you business, refine your processes, and to think about what you do, and how you do it.
- Don’t wait
Don’t expect to hear the national anthem play, or a government announcement like “Gentlemen, start your engines!” You need to be working everyday to build your own glide path back to restore your business to profitability, and you need to be moving now.
- Be prepared to move quickly, learn to be AGILE
Review your options and refine your plan every time you see a new trend emerging or regulation forcing you to move in a new direction. How comfortable will people with lingering concerns (customers and staff) feel in your facility? Don’t wait to see, ask them, and make the changes. Can you accommodate some space between consumers in your facility? How about your workers? How will this affect your capacity? Your pricing model?
- Understand the Technology and Resources you now have available to Interact with the Market in Real Time!
There are new tools and business models that provide to every business manager a new real time connection to the market that change the marketing planning paradigm. You need to identify and quickly engage the resources to apply and provide new marketing technologies to your business.It’s time to adapt to use of technology to support your business in ways you didn’t think were important before the pandemic. People now are completely connected to their mobile devices and computers almost all the time. Every segment of our society is now comfortable interacting via the Internet, video communications, and by text and email constantly. From kids to boomers, mobile devices are always near by and active. These are the pathways to real time information exchange. Recognize that you are competing on-line even if you’re a small retailer or restaurant owner.
For most of us in business, we have relied on a marketing model where we communicate our message to promote our offerings to market segments that we assume may be likely to purchase our products or services. We throw out our lines and hope we get a nibble, but we’re fishing on a huge party boat with millions of lines in the water. While we were fishing along side everyone of our competitors, the world has changed! Now the demand side of the marketing equation has moved to the lead. Customers now are presenting to the market their wants and needs looking for providers to present their offerings to those seeking them right now! You must be able to connect with those customers seeking your offerings rather than waiting for them to see your marketing message in a noisy and crowded marketplace.
Consumers, with full-time digital connections, have become more available, yet at the same time, more selective. They are ready to engage via a technology-enabled connection and they are more likely than ever to present to sellers of their current needs, preferences, and desires to attract the right offers.
While search engine optimization, sponsored ads on search engines, are important tools in the digital marketing tool kit, they are not the end all, and be all. Social media posts also are tools, but they too miss the point. You no longer need to fish for customers in a crowd by hoping that your business is listed on the first, second or fifth page of results from a google® search. You need to connect directly to each customer. You need to become the only fisherman on their lake.
- Start using technology to enable a new connection with existing and new customers
You need to begin to use digital technology that is much more than just putting out a web site or a bunch of social media posts to engage potential customers. You must go beyond buying search engine keywords, posting to Facebook, or putting pretty pictures on Instagram, hoping to stand out in a huge crowd. Customers aren’t playing a game of Where’s Waldo, so stop hiding in the crowd.You need to adopt new technology-enabling connectors that have the effect of allowing each consumer to present all of their current wants and desires to your business, giving only you the opportunity to have the first shot to address those wants and desires.
To transition your marketing model from the traditional provider-to-consumer broadcast model to the consumer-request-to-provider-offer model, you must utilize digital marketing technologies that can act, react, and interact in milliseconds.
For many, the capabilities of digital advertising and marketing technologies when combined with machine learning, artificial information analyzing and reacting to first-party information are simply unimaginable! But they are actually available to every business of every size and they can be effective at every level. Mobile apps that can connect nearby customers seeking your offering, right now, are available to you.
Find the guru that can transform your marketing model. Do it quickly. Find a marketing technology geek with the ability to tailor an offer to acquire a customer instantaneously, based on the unique characteristics of each consumer and their then-current “offer” to engage.
Use “viral” market builders to identify, engage, connect, reconnect, and spread the word faster and more effectively than any print or outdoor advertising model could ever do. Use “Influencer Marketing” of every shape and size to connect to new customers that demographic targeting would never find. Deploy tools that enable customer-trained “Machine Learning” to tailor interaction with each customer.
- Understand the steps of building your marketing campaign using a digital strategy
Digital Customer engagement is an efficient medium of digital marketing used by marketers to deliver marketing messages to consumers through online paid advertisements including, but not limited to, display and video adverts, paid search and social ads, and sponsored articles to connect and mobile technologies to engage each potential customer on a one-to-one basis.
Find a digital marketing technology provider that is willing to work with you to reboot your business using the right technology toolkit. Find one that is willing to partner with you with your specific circumstances and within your budget.
Email me today at R.DeSimone@roxven.com to discuss your business and how we can help get you back to profitability.
Richard DeSimone is the Managing Director of Roxiticus Ventures, a private equity firm that specializes in business launch, re-launch and expansion, and commercialization of business offerings. He is a serial entrepreneur with successful businesses in the financial and marketing technology, business services, and life sciences sectors. Roxiticus Ventures focuses on supporting new and growing businesses with financial, mentoring, marketing and organizational resources.