Time's a tickin'

Have you thought ahead about your marketing plans for 2010? What’s that? You can’t because you don’t know where the economy is headed? Point taken. But yet, you can’t avoid thinking about your plans forever.

To help get you thinking in some sort of strategic direction, Business Week published an article last week that considers three economic scenarios. Read our synopsis here, or read the entire article here.

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The economy has been in decline for 22 months, and as we head into 2010 many pundits assume things are going to continue as they are—or maybe get even worse. Others figure 2010 can’t be anything but better than 2009 and recommend business leaders plan accordingly.

Here are three possible scenarios for 2010; consider how each might affect your company’s marketing strategy. Under all three scenarios you’ll have to manage limited resources and keep a tight rein on cash. And under all three you’ll need to keep an eye on market share, top-line growth, and bottom-line management (among other things). But each of the scenarios presents not only different challenges but also unique opportunities to those who think strategically.

Scenario 1: More of the Same

Under the first scenario, 2010 looks pretty much like 2009, with good news dulled by bad, ups offset by downs. Those who have managed to achieve some sort of new equilibrium in 2009 might be able to make further adjustments, while companies that haven’t will continue to grow weaker—some not surviving at all. That spells opportunity to those that remain.

Key marketing strategy: Focus on share. This scenario presents a continuing opportunity to realize share in market gains as your competitors go belly-up or continue to cut back on marketing (some going all the way to zero). They may also have suffered slippage in customer satisfaction, making their clients more open to considering new options. Market as aggressively as you can to generate trial. Focus internally on good service and quality control. Ensure that existing customers have no reason to go elsewhere and new customers have no reason to go back to your competitors.

Scenario 2: Things Get Worse

If the recession continues to deepen or world events cause some other discontinuity, your attention will have to turn almost exclusively to keeping your business alive. Some companies won’t be able to retreat further without critically compromising their core competencies, and under this scenario they’re not likely to survive. While additional cutbacks may be necessary, do everything you can to avoid ceasing marketing entirely.

Key marketing strategy: Cut back, don’t cut out. Recognize that the vehicles through which you promote your company will also be suffering and will be highly receptive to making deals for their continually expiring inventory. This scenario will present more of a buyer’s market than ever, and those who can continue to buy will buy cheap. You’ll look back on resources you invest in marketing today as time and money well spent.

Scenario 3: Rapid Recovery

While we all hope for healthy growth to return, this scenario is in some ways the most dangerous as companies stock up, staff up, and ramp up their growth engines. The faster the economy recovers, the more we could be in for hyperinflation. You’ll once again be hiring, but the best talent will quickly get snatched up (and their compensation bid up). You’ll want to expand your inventory to meet rising demand, but inflation and materials shortages may threaten your ability to do so. You’ll be ready to market more, but the cost of media will rise as your competitors try to seize the day as well. It will be easy to become undisciplined in a free-for-all chase for growth.

Key marketing strategy: Moderate demand through pricing and payment terms. The greatest danger will be in growing too fast and running out of cash as your receivables grow (collecting money from customers facing the same challenges won’t be easy). Quality control may also become an issue as you rush to meet demand. While the temptation after two lean years will be to grow the top line as quickly as possible, focus on quality growth and protecting your margins. You’ll likely need the money.

It’s no fun to think about continued economic stagnation (or worse), and it may seem unrealistic to prepare for a rapid recovery. But that’s where the discipline of running a good business comes in. Take some time now to imagine yourself facing the three scenarios above and consider what kind of decisions you’ll need to make under each. The bigger a head start you can get on each of these scenarios, the better off you’ll be once one of them comes to pass.

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Steve McKee is president of McKee Wallwork Cleveland Advertising, a firm that specializes in helping stalled companies rekindle growth.