Short-term thinking has been an unfortunate but often necessary response to the recent economic crisis. If you are fighting for your job or your company’s continued existence, then this week’s, month’s, or quarter’s results are all that seem to matter. In those circumstances, brand building, customer development, and research efforts, among other things, take a back seat to direct marketing tactics that produce impressive reports and return dollars now. It’s one of the well-publicized reasons that digital marketing has benefited from shifts in traditional marketing budgets. Now that we’re seeing signs of a recovery, maybe we can pull back a bit from survival mode and take a longer-term perspective on our actions and their consequences. It would be shortsighted to assume that the last 18 months haven’t impacted our future opportunities.
Update Long-Term Plans Based on New Assumptions
Some smart, well-capitalized companies have continued to introduce new products or refine existing ones, to reach for new customers and markets, and to expand customer relationships through social media and other efforts. These companies have clearly articulated goals and action plans weighted toward long-term success. It will likely work in their favor, but the big unknown right now is how much the U.S. consumer has changed in the stressful last year or two and whether the assumptions on which long-term plans were made will still hold.
Consumer patterns have changed in response to recessionary stress. Consumers realize that home values won’t automatically increase every year, that credit won’t always be available, and that a good job is not a given. Many surveys report an expected long-term change in consumer savings and spending patterns that may necessitate a matching shift in marketer’s thinking and approach.
Long-Term Planning Must Be the Focus
For many companies, long-term planning was a luxury not available this past year. These companies must now embark on some serious planning to fill in their knowledge gaps and rebuild momentum that will make them a sustainable business. Quarter-to-quarter scrambles for sales will not safeguard them. Sustainable businesses have a reason for the actions they take and can articulate plans for the organization. They recognize environmental changes and respond appropriately to them.
Companies focused on the short term must immediately assess the damage they may have done to their marketing programs and businesses by ignoring the broad range of metrics necessary to a healthy business. It’s time to again start tracking and acting on the ability to attract new customers, create demand, maintain margins, and compete for and win market share. At a purely tactical level, these companies may have weighted budget to immediate sales activities and in the process sacrificed pretty much everything else.
Where Does Your Company Fit In?
Almost no brand or company exists at either planning extreme. Wondering where you would be pegged? Ask yourself these questions:
- Have you continued to nurture customers all along the online continuum? Do they find you when they searching in your category? Do you engage and inform them on your site and through all appropriate interactive channels? Do you leverage customer information appropriately to up-sell and cross-sell in customer relationship management and e-mail?
- Are you budgeting month to month or quarter to quarter based primarily on expected short-term returns?
- Does your top management make company or brand decisions based on a broad set of metrics or is it only about top-line revenue?
- Are you optimizing on portfolio results rather than line items?
- Have you continued to support your R&D efforts, to update your sites, to clean your databases, and to experiment with emerging communication channels?
- Have you stayed current with your customers’ mind set and their decision calculus as it relates to your category? Has it broadened your competitive set?
I’m certain that no one would argue that planning creates good results both short and long term, but it’s an investment that may need some time to pay out. Now that some of the pressure is easing off, we must remember how to be good businesses and force ourselves out of emergency mode as soon as we can.