Marketing in Tough Times
Copyright 2008, Carol Ann Waugh
With all the emphasis on the federal government’s "No Child Left Behind Act,” we sometimes tend to lose track of a very important point. State and local governments provide the overwhelming majority of funds to support the K-12 market. The latest NCES statistics for school year 2004-2005, reported that the state provides 47%, local governments provide 37%, and private sources provide 8% (primarily from private schools) while the federal government's share is only 8%.
Why should this concern us? Because it is difficult to pick up the newspaper lately and not find an article on how states’ budgets are being slashed due to reduced revenues. In addition, the housing crisis will seriously affect the collection of local property taxes – a major source for local school funding. We can see the writing on the wall. State and local funding for K-12 education is going to be reduced in the 2008-2009 school year and perhaps for several years after that.
As schools receive less money, they are going to have to make some difficult choices. And putting off or reducing technology and supplemental purchases may become a necessity as districts struggle to balance their budgets.
Chances are, you’ve already been thinking about how to pare down your marketing investment for 2009. So what’s a smart marketer to do in the face of this forecasted downturn? Here are some practical strategies for doing more with less.
Reduce Your Spending on Unqualified Prospects
This strategy calls for a renewed concentration on targeting your most lucrative prospects. It’s sad but true, but approximately 25% of the market will never buy from you. Identifying prospects with little potential can help you focus more attention and time on the prospects who might turn into customers in the near future. This is not only a strategy for selecting direct mail marketing lists, but one that can apply to other marketing investments such as advertising and exhibits. It doesn’t mean that you should eliminate advertising or exhibits next year, but it does suggest thinking about creative ways to pare down the time and effort spent in these venues with unqualified prospects.
Shorten Your Horizon
As strategic marketers, we like to look three to five years down the road and plan our marketing investments accordingly. But in tough times, a smart tactic is to shorten your timeframe to one to two years. Why? Because surviving in times likes these means getting an immediate return on your marketing dollars. So before you spend even one dollar, ask yourself the question, “Will this marketing investment pay off within the next two years?”
Being from New York, this strategy comes as second nature to me but now that I moved to Denver, I can see that being aggressive is not a national trait! But in these difficult economic times, smart marketers realize that everything is negotiable – printing, ad space, and yes, even creative costs like copywriting and design. In this market, your suppliers are also having a hard time and will be more anxious to get your business. And don’t forget to ask, “What’s free?” Many suppliers are offering “free” services such as banner ads on their Web sites, extra circulation of their magazines, and three different catalog treatments for the price of one.
Remember, the education market is cyclical and schools will always need instructional materials. They just might buy less of them this year or delay their purchases. And tough times always evolve into better times. Marketing smarter now will ensure that your company is around for the good times ahead!
ABOUT THE AUTHOR
This blog was written by Carol Ann Waugh, president of Xcellent Marketing (http://www.xcellentmarketing.com), a Denver-based consulting firm specializing in the K-12 education markets. Carol can be reached at email@example.com or by calling 303-388-5215.