Growing Business

12 August 2009 – 9:19 am

The Editor of Growing Business, James Hurley, contacted me and asked if I could answer one of his reader questions, you can see the question and my answer below.

Q. My business-to-business logistics firm has been holding its own in the recession, but cashflow remains a concern. I’m keen to reappraise costs, particularly in advertising and marketing. I’ve spent a fair bit on public relations, but it’s hard to measure the impact on the bottom line, so I want to invest in more measurable campaigns. Are there any risks associated with reducing or even completely cutting out PR?

Xavier Adam writes:

I would advise you to question whether you really want to put your PR and marketing on ice. No doubt you’ll have heard something similar banded around by the industry, but it’s true. As a business owner, I fully understand where you’re coming from. However, my organisation, AMC Network, is currently doing more marketing than we have in the last 10 years. Advertising, sponsorship, digital communications and PR are all on our shopping list.

Marketing works – we have tangible enquiries coming in as a result. If you’re a good client, treating your suppliers with respect and paying bills promptly, I’m sure they would want to help you. Have you spoken to them about your cashflow predicament? If you are straight and tell them how it is, they may be able to accommodate you, perhaps with temporary reduced payment terms, delayed billing periods or some added HR from your firm.

In terms of effectiveness, you can measure all you like, but have you straw-polled your audiences? I certainly do this on a regular basis, to ask them how they have heard of ‘things’, from campaigns to events and new products. This may not be very scientific, but it is effective, and you hear it from the horse’s mouth. It’s fine to back this up with research centre data, but getting a first-hand feel for your customers’ reactions is a good solid activity at any time, and one engaged in by most major retailers, for example. They will get on the shop floor and see what their customers are doing. All marketing is quite cost-effective right now, as demand is weaker than it was 18 to 24 months ago, but note that good operators will only price cut marginally. While there may be fewer buyers, there are still plenty out there for good suppliers.

A presumptuous approach, as we have experienced a couple of times, will not work in your favour. So talk to your suppliers to see if there is middle ground, and gauge effectiveness by polling your contacts. Remember, your suppliers and customers want you to succeed.

Xavier Adam runs PR and marketing firm AMC Network, which operates in six countries and is often engaged in wider global campaigns. www.redamc.com

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