Even online businesses must be prepared for the fallout of an unexpected event.
Tragedies such as Hurricanes Katrina and Rita remind us how important it is for every business to have contingency plans. Even an online business located nowhere near the affected area must be prepared for the fallout of an unexpected event. It could be a natural disaster, terrorist attack, or major product issue (such as a recall).
One of capitalism's great advantages is the entrepreneurial manager is free to quickly and effectively respond to a sudden change in circumstances. For example, unable to create and distribute its print edition after Hurricane Katrina, the "Times-Picayune" turned its Web site into its main information source. Though you may not be able to forecast the next unexpected event that will seriously affect your business, you can plan for it.
Operationally, a major event or disruption can translate to an inability to service customers at all or to deliver products or services to affected areas. When your company's location has experienced a natural disaster or an attack, you must remotely administer backup resources.
If you supply products or services to the affected area, you need ways to stop deliveries and provide alternative communications. While doing this, put customers' needs first. Understand your own company's needs may not be your customers' highest priority.
Major events can create a significant shift in demand. If opportunities aren't monetized at that time, the potential revenue is forever lost.
From a marketing communications perspective, these situations require delicacy and sensitivity to people affected by the event, whether they're your customers or not. With communications' instantaneous nature, people who are physically distant from a traumatic event may feel a strong emotional connection to it.
Analyze Your Business History
To establish contingency plans, first review your firm's situation:
Develop Contingency Programs
Once you determine the historical effect of major events on your firm, consider potential contingency programs to ensure business continuity, as well as your ability to monetize or at least mitigate the financial outcome of such an event.
Be sensitive to employees' and customers' needs. They may be experiencing extreme disruption to their lives, and your company is the farthest thing from their minds. To prepare, have plans to stop or reroute services and consider how to provide necessary information using alternative means. How you handle this delicate issue can have a major effect on the public perception of your firm. You want to appear on top of things but not exploiting the situation.
When making contingency plans, don't underestimate the value of marketing communications and PR planning. Include the following:
Create Backup Marketing Programs
Since unexpected events may interrupt sales or create new opportunities, consider how to use these events to improve your relationship with customers and employees. At a minimum, plan a backup promotion to compensate for a sales shortfall. (If you don't need it as a contingency plan, you can always use it to compensate for another type of shortfall!)
From an e-commerce perspective:
Media companies may be able to predict the approximate number of times per year where there's a surge in readership so their ability to serve ads exceeds their sales. To this end:
Even if your firm hasn't experienced any major jolts to its business in the recent past, the Boy Scout motto, "Be prepared," still applies. The emotional and financial benefit of being prepared can help your employees, customers, and the general public better get through difficult situations.
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Heidi Cohen is the President of Riverside Marketing Strategies, an interactive marketing consultancy. She has over 20 years' experience helping clients increase profitability by developing innovative marketing programs to acquire and retain customers based on solid analytics. Clients include New York Times Digital, AccuWeather.com, CheapTickets, and the UJA. Additionally, Riverside Marketing Strategies has worked with numerous other online content/media companies and e-tailers.
Prior to starting Riverside Marketing Strategies, Heidi held a number of senior-level marketing positions at The Economist, the Bookspan/Doubleday Direct division of Bertelsmann, and Citibank.
Heidi is also a popular speaker on current industry topics.
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Wednesday, July 23, 2014