The technology industry has a history of volatility, but recent years have been especially unkind to providers. From supply chain issues to increased competition and consolidation, many dealers already understand the tough road ahead of them.
In kinder economic times, many of us could simply throw money at problems and make them go away. But with profit opportunities declining in print, that’s no longer feasible. Some tried and true methods of weathering tough times will likely work again during this recession, but others are likely to backfire.
Age-old wisdom doesn’t always age well
This isn’t the first economic downtown most of us have experienced, and it probably won’t be the last. Many business owners may be tempted to do what they’ve always done, which is to slash their marketing budget. However, I’d advise against that. Over the past 10 years or so, smart business owners have come to understand that their customers now expect more from the relationship, and strong relationships need good communication. This is not the time to neglect your brand.
Continuing to communicate with your customers effectively is critical to maintaining their trust and reminding them of the value you offer, or better yet, stepping it up. However, traditional marketing methods are often expensive, unable to deliver highly targeted messaging, and can’t always prove their ROI. Your marketing dollars may have done quite a bit, but your sales team gets all the glory because they’re the ones who can show real numbers.
Here’s the kicker, though. The things that are easiest to cut in a recession are those that aren’t good at demonstrating value. If you cut your old-school marketing for failing to prove its value instead of revolutionizing your tactics, you may also fail to demonstrate your value to clients and end up in the same place as your marketing budget — eviscerated.
Fortunately, digital marketing is relatively cheap, can be spectacularly effective, and is easy to track. Even better, digital marketing tools paired with inbound marketing strategies allow you to use your dollars more effectively and see exactly how much you’re getting from them. If you haven’t seen returns from your traditional marketing efforts, don’t cut marketing altogether. Revolutionize your strategy.
My prediction: the businesses that are best at maintaining close relationships with their customers will ultimately come out ahead.
The user experience could predict your own
Henry Ford was not wrong when he said, “Make the best quality of goods possible at the lowest cost possible, paying the highest wages possible.” However, providing the best user experience possible is another powerful way to differentiate your business, especially since technology can be so complex for end-users.
Simplifying your customer’s experience with buying, using, and getting support for their technology is crucial, and they’re willing to pay more for a provider who can make life easier for them. Fortunately, once again, digital technology has made it easier than ever to do that.
An example of that would be an online client center that makes it easy for clients to manage their accounts, initiate and track service requests in near real-time, order supplies, and more, or a solution that helps speed issue resolution to clients.
It may be a good time to think about what you could offer your clients that others don’t, and new technologies that can help you do that relatively cheaply.
Keep your staff close and your highly skilled workers closer
Have you noticed that the average age of skilled printer/copier technicians is climbing? Holding on to your most talented staff has been a universal problem over the last few years, but we have a bigger one, and it’s not going away, no matter what the economy does. Attracting and retaining great people is important to every business, and it’s no less so when you’re a tech provider.
Unfortunately, fewer young people are showing a desire to enter what is often viewed as an older industry. We know that printing will always be needed and can deliver value, but the perception that printing needs will shrink significantly isn’t exactly helpful.
Younger workers also don’t view skilled trades the same way their parents did, and they certainly don’t see promising career paths there. You’ll have to overcome that mindset if you want to stay in business long-term. If you don’t address the issue soon, don’t be surprised when someone leaves, and you suddenly can’t find anyone to replace them.
“No one wants to work anymore” is the business catchphrase of 2022, but I haven’t found that to be true. People want to work, or rather, they want the things that typically only come from working. But most young people don’t want a dead-end job in a specialized trade where their skills may be largely useless in 10 years. They want a living wage from a company that values them and finds tangible ways to show it. The trucking industry has the same problem if that’s of any comfort.
Restructuring the business to be more efficient and responsive to clients may serve organizations well in the coming years. Some additional hiring may be necessary, but often it’s possible to just move people around internally and provide additional training where necessary. If there aren’t paths forward in your company, try your best to create them; if there are, make sure everyone knows about them.
Create customer stickiness with more touchpoints
Once you’ve sold equipment or a service to a customer, is that the last they hear from you unless something goes wrong? Is the only time they see your name when they get a bill? Look for other ways to grow your relationship with your customer … and I don’t mean bombarding them with unnecessary and irrelevant emails. No one likes that.
But within your existing customer base, there may be a way to cross-sell other goods or services like cybersecurity or software subscriptions. And especially if you had good data about who your customers are and what they need and use, you could use that data to significantly increase your revenue without having to attract one new customer.
Is a certain product they’re using about to reach its end of life? Is a contract or subscription about to expire? A perfectly timed email or phone call could make all the difference. These strategies also provide additional value to your customer and build their trust in you as their provider.
You may not be able to design an online customer portal — that takes quite a bit of time and resources. But you might include helpful tips on your website. The trick is to put yourself in your customer’s shoes and think deeply about what you can do to make their life even slightly easier.
The long and short of long-term planning
Not even the world’s top economists can agree on how long this recession will last or how severe it will be — nothing new there. But having a few unknowns doesn’t mean long-term plans are completely ineffective for businesses like ours. It just means you may have to adjust your plans as your circumstances change. Nothing new there either.
We already know the major problems we’re facing — recruiting, consolidation, and a significant economic downturn — which means all of us know the broad strokes of what we need to plan for. That’s enough. If you skip the planning process altogether, you’ll spend the next few years reacting in the moment to difficult, yet largely predictable circumstances, which will put you at a tremendous (and completely unnecessary) disadvantage.
Recessions are especially terrifying at their start, but they can serve as a nudge to address any inefficiencies in your processes. On the other hand, boom economies come and go, and they have a way of glossing over ways your business is underwhelming your customers or wasting money.
Finding new ways to be more efficient, attract and retain top talent, and offer more benefits to your customers will serve you well, no matter what the economy’s doing. It’s always tougher to do all three during a recession; I get it. But a long-term plan that can address each of these upcoming challenges in a way that’s sustainable for your business will pay off.
Shift happens in business. But I, for one, can’t wait to see how our industry finds new and creative ways to help our customers and make our businesses stronger.
Doug Albregts is the CEO of Marco, the largest IT integrated solution provider in the United States. Before joining Marco, Doug served as Group CEO at Scientific Games, where he was responsible for a global operation of $2 billion in revenue. Previously, Doug was President, CEO, and Chairman of Sharp Electronics America, where he was responsible for the overall leadership of the consumer products, home appliances, robotics, display devices, energy storage, and business/office groups. He has also held executive management roles at American Express, NEC, Samsung, Canvys (a Division of Richardson Electronics), and Golden Books Publishing.
