Part 1 of a 6 Part Recession Survival Series

As belts tighten and budgets squeak, people are drawing new lines to define what they think of as essential, and what they classify as a luxury. They’ll hang onto essentials, they’ll either let the luxuries go, or they’ll find lower cost alternatives to them.

Right now, that line is being redrawn almost constantly. As people realize that it isn’t just a blip. That it isn’t going to go away, that it is going to be long, ugly, and bad. This means their idea of what you are, is going to be in a state of almost constant flex. It means you have to think ahead, not just about what they think today or tomorrow, but how they will think if worst comes to worst, and life gets very hard.

So who decides whether you are essential, or a luxury?

You do. But you can’t just TELL your customers or clients that you are essential and BE essential.

You have to listen. You have to HEAR what they think essential is. Then you have to BECOME what they define as essential.

It means being creative. Maybe soap is essential. But maybe the good soap becomes a luxury because now they can only afford $1 per bar for soap instead of $5 per bar. How will you become essential again when they decide like that? Can you?

If you insist that the $5 bar is better for their skin and preserves their health, reducing the cost of lotion, or allows them to wear less expensive fabrics and be comfortable, or that since they use less of the expensive stuff to get clean that it is actually a better deal that it appears, then maybe you can be moved into the essential classification again.

Half of this is going to be marketing. How you describe the benefits. What was a benefit yesterday may not rate as an important benefit today. “Indulge yourself” as a slogan may become completely irrelevant. Cease to exist as an effective message. “Affordable Indulgence” may be a message that was scorned yesterday, but embraced today. People may want you to tell them what a good deal it is today, when yesterday they were only concerned with how good it was. Mincsets and thought processes, priorities, and values, are GOING to change.

The other half is the actual product or service. Can you change it, make the effort to contain costs, through creative strategies, while still keeping the price the same (while your expenses rise), or even drop the price, offer a lower cost option, etc? I’ll address specific ideas in a later article, but this question is the one that defines the successes in a tough economy. If you can do this, you can survive. If you cannot, you probably won’t.

So go look at your business – examine your products and services with a critical eye. Look at your marketing messages and figure out whether they are going to meet the changing needs. Be creative, and come up with a way to change what you do, so you can be essential. Because if you are a luxury, you are going under.