Recession Beater #4: Small Business Marketing Consulting
One man’s crisis is another man’s opportunity.
We’re all familiar with this concept.
Mold remediation companies, bankruptcy firms and oil spill contractors all depend on others’ setbacks for their livelihoods.
The crisis-opportunity dynamic is woven into the fabric of their businesses. Yet, few who need their services think to themselves: “this opportunist is profiting from my misfortune.”
This dynamic will be with us for as long as man inhabits this spinning rock.
How about those of us who are entrepreneurs, marketers and consultants?
These days, most of us are concentrating on shoring up our own businesses while preparing for the next round of thunderclaps in the financial markets. Yet, however we feel about it, the crisis-opportunity force strengthens by the day, like a hurricane over open water.
The Two-Word Question That Reveals Everything
Take this test.
The next store, shop or restaurant you’re in, ask the owner or manager this simple two-word question.
How’s business?
If you’re in a hurry, you’ll need to prepare your exit because he or she may give you a fifteen minute (or longer) answer.
All their anxieties, all their worries come poring out. Many times, they’ll reveal their deepest, darkest snake pits that are keeping them awake nights.
That’s because, almost no one ever asks them this question and most of them are more worried now than they’ve ever been in their business lives.
In June, I wrote about why small business consulting is a golden opportunity in 2008.
At the time, few could forecast the degree of upheaval that would happen in four short months. One who did was Clayton Makepeace, one of the smartest minds in the Smoky Mountains. (Hey, Clayton, why don’t you ditch the biker garb for a few months and run for Senator. You might give your party a fighting chance, as well as put a decent and skilled person in Washington.)
Today, there’s no need for anything so elaborate in the marketing consulting game.
Anyone who’d like to open the money spigots, while rescuing local businesses from certain extinction need do only five things.
- Get them talking. “How’s business” is often sufficient.
- Convey your expertise. In my case, I mention my experience helping collapsing businesses at Ground Zero, Post-9/11.
- Convey how busy YOU are. From the moment I get a whiff that a prospect wants a consult, I let them know I’m terribly busy, which I am. We all want what we can’t have, as well as what others want, and this is a key nuance.
- Qualify their readiness.
- Qualify their ability to pay.
That’s it in a nutshell.
Nothing sharpens the senses better than fear and right now, it’s all around us.
The same fear can translate into a lot of money in your pocket, if place yourself in a position to help the local businesses all around you.
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Comments on Recession Beater #4: Small Business Marketing Consulting
Years ago I had the brilliant(?) idea of starting an ad agency focusing on small business. It seemed a good niche opportunity since big agencies tend to go after big clients. It’s not hard to get an audience with a small business person, nor is it hard to get them to buy into your ideas. The difficulty I’ve found, is that they most often either do not have enough budget to make it worth your while, or simply can’t fathom spending any significant coin on marketing. Either way, this is one tough crowd to extract cash from, although not impossible. They are also often the most likely group to stop or cut advertising money in a bad economy, since they operate closer to the wire. You had also better not front or guarantee any media expenditures for them. Cash up front for all third party expenses.
I’d say your ability to do well in this scenario depends largely on your own overhead.
This seems to be a typical ‘how to’ by someone who hasn’t tried it himself.
I’ve spent many years trying to earn a crust by helping local small businesses and can tell you that it is not easy. Over the years I have built up relationships with a small number of excellent clients, but there have been many frustrations and disappointments.
As is often the case in life, those who look like they don’t need help or those who find you rather than you find them turn out to be the most rewarding.
If you try this, be prepared for a character building hard slog.
I made my bones, so to speak, in the fumes of New York City right after 9/11 and experienced more frustration and disappointment in several months than most do in an entire career.
But I found some great (and courageous) clients. The problem at that place and time was most clients’ ability to pay because business contracted by 80% or more all at once. There just ceased to be any clients in the entire zip code.
Through how many recessions have you practiced marketing consulting to small businesses and how did you qualify them in good cycles?
Recessions have the beauty of knocking the complacency out of business owners.
Obviously, in any professional practice, the people that come to you are the strongest prospects and usually the best qualified.
I’d take a loaf of bread, thank you very much.
Lawrence
Rich, excellent comment on not fronting any media/advertising expenses. Been burned there myself.
Decently capitalized consultants are poised to do very well.
I have spent almost seven years asking these questions, in good times and bad. The result.. some of my early – small clients are now big companies.
I now have tiered offerings, books, classes, group consulting sessions and white papers for micro businesses
and private consulting for larger companies.
I’m sorry and no offense but I think this idea is lackluster. I agree that if you stop and ask a small business owner “how’s business” they are going to cry on yoru shoulder. There is no doubt about that. But when a small business owner, who has mounting debt, sharp declines in sales, and no solid prospects for seeing the light at the end of the tunnel, the last thing they will do is hire a “consultant”. Let’s get real!
There is a stigma attached to the word consultant. People start a small businesses because their mindset is one of being able to do things on their own. During these seasons of deep economic recession the consumer goes into hiding. This particular season of economic downturn will be more pronounced because consumers can no longer use their homes as ATMs. The consumer’s access to credit is gone. To get a car loan these days a consumer needs a credit score of 700 or better. Who has that?
Let’s get back to reality and come to terms with the fact almost no small business owner is going to spend cash he doesn’t have on a consultant, no matter how great the consultant sells himself.
If you want a good business idea, think about this… during the holiday shopping season retailers are going to be at the mercy of the non-existent consumer. The consumer will have the retailers by their necks and will force them to slash prices by as much as 70% or more.
I will be “investing” my venture capital into buying drastically reduced consumer goods that have longevity and I will hold these goods until the economy begins to turn around and I will see these goods back to the consumer through auction websites or how ever way I see fit and profitble.
We’re in a bust cycle but a boom always follows a bust. If it takes months or years, so be it. But I will have longevity consumer goods purchased at rockbottom prices and when the it becomes a buyers market in the future, the payoff will be there.
Gary, you failed to mention the definition of a consultant.
Someone who knows 365 different positions but can’t get a date on Saturday night.
Maybe, a nice, new euphemism needs to be thought up for “consultant.”
Thanks for sharing the longevity goods play.
Brilliant.
Ciao for now,
Lawrence
Here is a comment from one of the most successful marketing consultants I know.
He made enough money during the early 90’s recession to retire and pursue his first love — jazz music.
“I believe this opportunity that you’re involved in is by all accounts the greatest business opportunity that exists on the planet.
I realized all of a sudden that I had the ticket to financial independence forever because everybody wants to make more money.
If you can show people how to make more money, you will never want for money yourself, regardless of the economy…”
No one said it’s easy. There is a LOT of trail and error and you have to be prepared (like in many things) to do the OPPOSITE of what others are doing…but the fundamental proposition of never wanting for money yourself IF you can show others how to make money is certain. And the beauty of this business once someone gets it right is you don’t need to front a lot of capital yourself. It CAN be bootstrapped.
Can anyone give me an idea of charging structures when offering consultancy work?
Appreciate all and any comments.
Thanks
James
Can someone give me an idea of charging structures as a consultant?
Can someone refer me to an article or tell me the most recommended method of calculating project price or the fair percentage to charge for the marketing plan, also how to ensure that I know the difference that my marketing made to the bottom line ? Also, how much of the execution does a marketing consultant actually do ? Much appreciated.
And thoroughly enjoying the content.