During the Cold War, President John F. Kennedy presented the
goal of landing a man on the moon and returning him safely to Earth by the
close of the 1960s, saying, “We choose to go to the moon in this decade … not
because [it is] easy, but because [it is] hard.” As we know, on July 20, 1969,
Neil Armstrong set foot on the moon’s surface.
Today, we live in a similar environment, but instead of moon
landings, we are faced with a deepening recession that few of us have
experienced.
Yet entrepreneurs have the same opportunity right now. They
are the JFKs of today. They dream of doing big things because they are
necessary. But unlike JFK in 1961, entrepreneurs have a playbook of successful
ventures to look to for guidance.
At Ernst & Young, we see success stories firsthand
through our Entrepreneur of the Year awards, and we’d like to share a few
pointers for entrepreneurs to use to drive successful businesses.
First, chase customers, not competitors. Often, companies
get into the “they-did-it-so-we-have-to-too” battle. However, competitors
aren’t going to pay you. Focus on your target markets and make sure they hear
your message and that it resonates with them.
For instance, when the economy took a downturn, Dream
Dinners, the Snohomish-based prepared-meals-to-go franchise, focused its
efforts on retention strategies with its existing stores. By redoubling its
efforts on existing customers, creating a customer loyalty program and
expanding product offerings while ignoring competitors’ efforts, Dream Dinners
doubled its retention rates and created a foundation of growth for the future.
Second, be seen. One of the worst practices that companies
fall back on in tough times takes them out of the potential spotlight: cutting
their marketing budget or eliminating it completely. By so doing, they neglect
the opportunity to be seen as a really viable company. History shows that
companies that continue to market through a recession come out of that period
in better shape than those not marketing themselves in tough times.
This is exactly the approach that Unitus took. Through
public relations outreach, the Seattle-based international microfinance
organization was recently featured in several media outlets, from Bloomberg
News to the Huffington Post. A nonprofit organization that relies on the
support of foundations and individual donors, Unitus understands that successful
media relations can strengthen an organization’s image with its target
audiences, whether they are customers or donors.
Third, keep doing what you do best. You saw a need and
developed a plan to meet it. Now it’s time to execute and build upon that plan.
Do so by observing what your target consumers expect and then meet those
expectations.
For example, rather than being trendy, McCormick &
Schmick’s restaurants provide dining experiences centered on quality service in
a comfortable atmosphere. They focus on their most loyal “preferred guests” who
return often, spend more and recommend the restaurants to others. Relying on
recommendations has helped the chain combat the economic downturn.
It was a bleak time in American history when we landed on
the moon, but the dream of a nation made it happen. Entrepreneurs have the same
opportunity right now. After all, a recession is a terrible thing to
waste.
Greg Beams is an audit partner in Ernst & Young’s
emerging growth and technology practices in Portland and Seattle and has served
as program director for the Entrepreneur of the Year Award Program in the
Pacific Northwest since 2006.