During the ‘Dot-com’ bubble burst of the early 2000’s, more than half of all digital start-ups collapsed and during the height of that recession 51 companies a day were closing in the UK, with around 27,000 by the end of 2009.
Most businesses will suffer in a recession, usually because demand reduces and uncertainty increases. Experts are talking about this being like no other similar economic situation witnessed, there have been no oil price increases, financial panics, and most governments have moved to implement unprecedented measures to assist companies to ‘hunker down’ and weather it out as best possible.
But whilst it is unlike previous downturns, there are certainly some lessons that can be learnt and there is plenty of evidence to support how you might weather this storm and come out of it in a relatively strong position ready to build again.
Get comfortable with change
You’re probably dealing with an overwhelming amount of decisions from debt management, client relationships, how best to support your workforce in their new ways of working, how to adapt your services to be fully remote and getting your head around the lightning speed your organisation has had to digitally transform. But the underlying thing to remember is that a recession is a high-pressure change management environment, you need to get your flexible head on, be comfortable with change and be ready to adjust quickly.
Focus on your current customers
Take an empathetic approach, check in regularly, think about what their pains are right now and consider if there is anything you can do to help. Switch your focus onto your clients and not yourselves, understand the crises they are facing and how you could help mitigate their problems. Now is the time to strengthen those relationships even more than before. If you don’t have key client plans in place, get them done. If you do, review them at the very least weekly. Get your best people client facing and engaged.
Double down on sales and marketing
You’re probably thinking ‘well they would say that wouldn’t they’ – but it’s not just from personal experience of the last recession, there is plenty of evidence to show that those companies that simply switch off all sales and marketing efforts in a downturn take longer to turnaround and risk losing audience and momentum. The flywheel has to keep spinning and the more fuel you add to it the more momentum you gain for the upturn.
We are all going to have to make some very difficult decisions in the coming weeks and months that could have ramifications for a long time after this global crisis comes to an end on the future of our businesses.
Whether you’re a new business or one that’s been around for decades, these times might be more difficult than you’ve ever faced before – seek out the opportunities in dark times and your business will survive, you just have to be bold enough to go for them.