What's Great About This Recession...

With all the doomsday talk these days, I thought I would offer a bit of contrary editorial for your reading and consideration.

What's good about this recession? This recession, more than others I have seen, is really cleaning house with businesses that did not make marketing and customer service a priority. Don't get me wrong: I am not saying that any company doing badly in this recession was poorly managed before the recession. What I am saying is that a key marketing strategy in any recession is customer retention. And customer retention can only happen if customers truly value the brand. If you go into a recession with your customers placing a high value on your brand, then when push comes to shove and those customers must decide how to spend their fewer dollars in uncertain times, there is a greater likelihood that they will continue to spend their money on your brand and you will retain them as customers.

Regardless of whether you are currently employed or not, you have an opportunity to watch how virtually every organization you may have been previously interested in working for is handling these challenging economic times. And, while almost every business has been hurt by this recession, there are some number of companies who are still doing well. Pay attention. Watch closely. Some are actually prospering, and a larger number are getting by, turning a profit and taking care of their customers and their employees during all this mess. Those companies should be the ones you want to work for when times are better or they start hiring. Don't be surprised if they are not hiring long before most companies are, too.

To illustrate my point, let me offer for your consideration a local business that I frequent and think is faring quite well when many others are not. The Pita House, located on Pleasantburg Drive in Greenville SC, is a family-run business that offers a variety of foods from the Middle East. It is managed by Ziad with the help of wife, Ikhlas, children, cousins, uncles, aunts, nephews, nieces and friends. The place is always full. In fact, several weeks ago another customer surveyed the crowd that day and remarked, "There's no recession at the Pita House." Indeed, there is not.

Now, Ziad will tell you that he is blessed and he is. But he is also a great marketer because great customer service is one of the smartest forms of marketing and the Pita House makes great customer service a top priority. What can other brand-builders learn from Ziad for the future?

1. Be consistent in your quality. In my 500+ meals at the Pita House, I have never had a bad one. Neither have any of my take-out orders ever been inaccurately filled. Never.

2. Make loyal customers feel special. Many times, when I am in that restaurant eating with someone (rather than doing take out), Ziad has brought us a small dessert free-of-charge. This makes me feel appreciated but it also sends a message to my guest that I am a regular, someone special to Ziad and his family and perhaps they will be appreciated in such a way if they return.

3. Distinguish your brand in product and service. While there are a few other restaurants that offer similar cuisine, the Pita House distinguishes itself as much as a family business as it does with its cuisine. When I first went to the Pita House, I left a tip on the table, but John, another manager, followed me out that day and gave me my money back, telling me they were a "family restaurant," meaning that everyone was well-provided for without my tip. The fact that they had so much pride in their "family business" status to refuse the tip left an impression I did not forget.

4. Remember good customers' preferences. Many days I order the same meal because it is the cheapest on the menu. Most days when I walk in, they ask, "The usual?" and I nod my approval. Every now and again, I mix it up and they actually tease me when I do. It is another way they thank me for being loyal to them.

5. Don't let anything come between the brand and its customer relationships. Visit the Pita House tomorrow or in a month or in a year -- you will find the same people at the counter: Ziad, Ikhlas, John, and Manal. They do not vary who meets the customers and who services them. Pita House customers feel valued with the familiarity and that is another reason why they keep coming back. Familiarity doesn't really breed contempt, it breeds comfort. So many organizations change sales reps on their customers all the time. How valued does that make your customer feel? Or the company tries to use some form of technology to distance themselves from their customers. Not smart.

6. Consistently offer good value. The Pita House is by far not the cheapest lunch you can get in Greenville SC. In fact, most diners are paying between $6-8 to dine with Ziad and family. Why? Consistent product and service makes a strong restaurant brand and that is valued by today's consumers when so many others are inconsistent.

Now, I doubt Ziad will have a job for you now or after the recession is over. But others will be hiring and during these bleak times, take a good look around. Where are the great brands of this recession? Some companies are still prospering because they have created highly-valued brands. Those are the companies you will want to work for in the years ahead.

Great customer service is very smart marketing.

This recession will not be our last. In years to come, we will have others and the actions of organizations in this recession can tell you a lot about who you will want to work for in the next recession. Look for businesses and brands that don't just talk about how they value customers... look for the ones who are demonstrating it. Every day.

Thanks for reading.

More to come!

Dismantling Critical Infrastructure

I recently heard the CEO of a marketing communications firm talk about the advantages to organizations of maintaining marketing budgets in the face of this economic crisis. While I agree with him philosophically, I think the issue is broader than just maintaining a marketing budget during these tough times.

What I am witnessing almost daily is the dismantling of critical operational infrastructure of many organizations. And, as these organizations know, the building of that infrastructure was not easy. It took time to design the processes that were needed and to build an infrastructure to support that process. Then, they had to hire all those people and ensure they were trained adequately to support the process. THAT was a lot of work!

Now, organization after organization seems willing to throw out that infrastructure for the sake of what? Profits? Or real survival? I think this is a key question every "for profit" CEO and their board of directors need to think about. If it is actually the survival of the organization, I support those decisions. But I am not so sure that is always the case. There is increasing pressure on every publicly-traded company to deliver profits every year. And, most senior-level executives will admit that sometimes future opportunities are sacrificed for present profit. Even when those future profits might have far greater potential than the current market situation might offer. That is a reality of our "give it to me NOW" society.

In addition, I fear that businesses may be reacting like some of the journalists I have been listening to and giving in to a panic that only makes our situation worse. These challenging times call for courageous leadership from CEOs (and their boards) everywhere.

During the last recession, I owned a small consulting practice, which I sold in 2005. Near the end of 2002, I realized that I needed to revise my goals for that year and the near future ... that the ambitions I had entered the year with were not going to be realized. The insight I had at that time was that I needed to do whatever I could to make sure that my company made it through to the other side as unscathed as possible, regardless of what my personal lifestyle (that came from salary from the business) became in the interim. I knew that my company needed to be ready for that inevitable recovery when it did come.

What I am witnessing almost daily is the dismantling of critical infrastructure of many organizations.

Interestingly, I had witnessed three competitors close their doors and I did not want that to happen my business. So, I made the changes that allowed me to survive those difficult 18 months so that I could rise with the tide that came in 2004. And rise it did and my company did. But in those dark times, I made a decision that I would take very little income (and minimize my debt) so that I did not harm its ability to compete when things began to turn around. In essence, I sacrificed current profits for future profits.

As I look at these times, I cannot help but wonder if some organizations would not be better off if the shareholders made a decision to forgo profits in 2009-2010 for the sake of maintaining as much infrastructure as possible. To be sure, some cuts most likely have to be made. But there is also a sound argument for maintaining as many people, particularly in critical customer service areas, as possible. Every business owner will have to make this call themselves as they consider goals beyond our current economic conditions.

Thanks for reading. More to come.

[Photo used under the Creative Commons License courtesy of Flickr.]