COVID-19 has played havoc with the economy. No one knows where things will go. The only certainty is uncertainty.
by Eli Greenbaum
When the economy goes downhill for any reason, it is only natural for businesses of all kinds—including towing- and recovery-related services—to wonder how the slump will affect their revenues and what, if anything, they can do about it. With the pandemic swirling around us, economic concerns are spiking.
As sales slow and revenues tail off, some companies almost reflexively move to cut overhead, slash costs, and save every nickel possible. It might seem like a sensible maneuver, as it is logical to think that with fewer dollars coming in, fewer dollars should be going out. For most companies, this translates into cutting marketing and advertising budgets first. After all, why pay for all those ads, television and radio spots, and social media messages when customers are not spending? When the economy is up again, that is when you will spend on marketing again, you rationalize.
In reality, this may not be the best tactic. Here is why: By cutting back, you might be ensuring that your sales and revenues will continue to decline—exactly the opposite of what you really want to do. Suspending marketing efforts because sales are decreasing cuts expenses, but by reducing marketing activities you are making yourself less visible, easier to forget, and virtually guaranteeing that sales will continue their downward cycle. You are actually implementing a self-fulfilling prophecy. By saving a few dollars now, you could be losing a lot more in the long run.
Consider a less obvious methodology that could work very well for a towing service or sector supplier. There is a line of reasoning that says when the economy tanks—as it is doing right now thanks to COVID-19—this is the time to make a more energized effort to protect your business and your brand. In fact, this may be the right time to expand your marketing efforts.
Putting the brakes on marketing may
assure your business’s demise.”
During difficult economic times, when most companies pull back their advertising, the playing field presents less competition for the companies that are not afraid to stay in the game. It has been repeatedly shown that companies and brands that maintain—and even increase—their marketing programs make out better in the long run simply by staying visible.
Maintaining composure when the economy is wobbly is not easy. You want to protect your assets. You have worked hard to build your brand and you are a known entity in your area. But instead of worrying about the economy harming your business, view this as an opportunity to take possession of a bigger share of the market—the share that other companies have abandoned by withdrawing. Putting the brakes on marketing now may assure your business’s demise. As Henry Ford once said, “A man who stops advertising to save money is like a man who stops a clock to save time.”
A man who stops advertising to save money is
like a man who stops a clock to save time.”
It is important to control spending during a downturn, but it is also important to protect your brand by remaining visible, taking care of your customers, and recognizing that a little more effort than usual may be needed to safeguard—or grow—your market share. This is the time to be smart about where you put your money.
As a former advertising agency creative director working on marketing strategies with various types of businesses, I have seen what happens when companies either cut back or seize the opportunity that awaits them. I have been in those meetings when clients have their aha moments and suddenly understand that with the competition pulling back, it is their chance to go full steam ahead.
Experienced business people know that a company’s success is not only about market share, it is also about share of mind. Advertisers with the confidence to maintain or grow their budgets through a shaky economy are often rewarded with enhanced sales and market share when times improve. That means staying on the consumer’s mind and keeping current and future customers aware of you, even though they might not be buying that day. It means hanging in for the long haul, knowing that the reward may not be felt for months.
“It’s important for a company to maintain visibility during tough times,” says Keith Donovan, president of Airfoil Communications, a U.S.-based public relations company. “Customers want to deal with companies they can trust. Being visible and appearing strong during difficult economic cycles helps instill confidence in a customer’s view of a company, and that can make all the difference in which company a consumer ultimately patronizes.”
Now, you may be saying to yourself, these tactics are great for most types of businesses, but the towing sector is different. Not so. Regardless of the economy, people are still driving, maybe not as much, but they are still on the road. Vehicles still break down, accidents—unfortunately— still happen, cars are still parked illegally, vehicles are still impounded, and when such situations arise, towing help is still needed. Bottom line, the towing sector is active. So, as a towing service or industry supplier riding a rocky economic road, here are some things you can do to position your business for survival and success during tough times.
Take a close look at your spending
This may not be the time to severely limit your spending, but it may be time to rethink it. You will need to evaluate which of your marketing efforts have been successful, and which have not. You may want to reallocate your dollars: Stop spending on what does not work and prioritize what does. If social media is working, keep it going. Take a close look at which print or broadcast channels are most effective for you and support those. What about outdoor signage? And if you are committed to Internet or digital advertising, consider connecting with a knowledgeable marketing agency that specializes in search engine optimization and can help you take advantage of the new data technologies that support marketing communications and target your prospects. That could be money well spent.
Take advantage of your competition’s fears
When other towing services and suppliers cut back on marketing in rough times, they are no longer competing with you for the customer dollars available. Their pullout from the marketing arena gives you more room to flex your advertising muscle. You will be more noticeable by simply maintaining a market presence. Remember, the most important thing you can do during down times—and good times—is to stay on the customer’s mind. In tough times, promoting your services and products sends a clear message that you are open for business.
In the current coronavirus situation, adding messaging that speaks to the safety measures you have put in place says, “We are open for business, and we are doing X, Y, and Z.” Greater visibility and safety protocols—such as drivers wearing masks, truck cabins being sanitized, etc.—will boost consumer perceptions of your strength. By marching forth when everyone else is retreating, you have a real opportunity to keep current customers and acquire new business.
Understand your customer
Your customers are probably just as nervous as you are about the economy. Bad economic news erodes confidence, and no one is about to spend money imprudently. Frankly, that is a boon for you because people may be holding on to their vehicles. Those vehicles are getting older, less reliable, and, as noted, more prone to breakdown and crashes no matter what the economy is like. They still need towing services and towing services still need suppliers. Whether you provide those towing services directly, or are a supplier to towing companies, contacting former customers via email blasts and offering special promotions or discounts can generate business. If nothing else, they will know that you are there and ready to serve them.
Make some deals
Since many companies do cut back on marketing, media channels are often more willing to make attractive deals to retain or gain your business—they, too, may be feeling the pain of a southbound economy. With some astute negotiation, you may also be able to get a great ad rate and lock out your competition. This would be a good time to secure long-term rates that will still be in effect when the economy turns around. It is an opportunity to spend less now and actually get more now and later.A bad economy could have a silver lining that turns into a golden opportunity. It is not easy to take a disadvantage and turn it into a genuine benefit, but it is possible. Staying the course, knowing the down cycle will eventually turn up, and trusting in a long-term marketing strategy can help you survive the downside and be ready to soar on the upside. Keep in mind that marketing and advertising costs are not really expenses, they are investments in your company’s future. And with proper oversight, the dividends could be very worthwhile.