The recession changes: from revenue generation to retention

When times are good – people want it.
When times are bad – people need it.
The “desire buying” changes into a “necessity buying”.

This is also true for businesses:
The change of focus from revenue generation to revenue retention.
From lead generation to customer retention.

Prosperity: lead generation to grow business

During times of prosperity marketing spends lavishly on trade shows and advertising campaigns without much justification of measuring the results.
Anything or any method is good enough to bring more leads, more customer acquisitions and more expansion potential in different markets.
The challenge of obtaining ever more market share and customers.
Maybe the goal of Marketing is to make an impression on customers, potential customers, competitors or even the Board Of Directors?
At the same time sales people are eager to gain new customers as these have to potential of bringing even more revenue, thus more commissions for them.

During good times the focus is more on lead generation and conquering new markets than on customer retention and optimization of operational costs.

Management wants to realize expansion plans as they believe in the potential of their business. Probably in order to sell the dream of a big company to their Board of Directors for the sake of ever bigger bonuses.

Management and Board Of Directors both want more revenue.

Recession: customer retention to keep business

During a recession or depression, cost needs to be cut. Management will question any marketing initiative and restrict trade shows and advertising. Generating leads is an expensive process with a big risk of failure, thus not so much in favor.

During a recession the focus is on customer retention: as retaining a customer costs about 6 times lesser than customer acquisition.
The challenge is in keeping your customers.
Nurturing leads and customers is utmost important in order get additional revenue at the lowest cost.
Less costs, less expansion focused, but more revenue at less expenses.

Generating leads is great, but the road to invoicing and getting paid is long.
Thus addressing existing customers is a much shorter journey.
Management just need sales – the sooner the better.

Management and Board Of Directors need revenue.

Does your management wants business or needs business right now?
The question is what can?
(Yes we can)