Too much optimism can kill.
In times of economic crisis, your marketing and sales departments need several competencies: speed, flexibility, realism and persistence.
What we learned from earlier crises is that those companies that react quickly and creatively can best control the damage. Those who react (even a bit) too slowly will lose money and market share. Most media company boards will only accept a budget that is better than last year's. They call it, most years, a budget with “ambition.” Well, this year it's time to change that behavior.
Who on earth is able to make a budget for the whole year 2012? Not one government, not one company, and surely not a company that is dependent on income from advertising. I would call a budget with growth in income next year a “lie,” a “dream,” or a “bad piece of work.” For those who are in an income-growth position, I invite you to speak at the next INMA conferences, and to speak with the INMA staff for an in-depth interview. I'm afraid we will only meet a handful of people.
What I would do? Budget for the year with a realistic target. Organise a three-month, formal budget review. But, most of all, start with some sense of urgency actions in the companies. Before you go to the phase of cutting costs, you need to do everything possible to keep your market position. It's about time for real crisis management, but not the old-fashioned one of cost cutting. Make a choice for some brave actions. Make sure that everybody in the company is put in a role close to clients. Even your bookkeeper can help you with this. Ask them what we can offer to make sure the clients pay in time. Surely they have ideas.
Organise a storm of actions toward the market, filled with propositions a client can't refuse and prices a client can pay. It's not enough if you keep your price on the level of this year. Go for the best offer a client can find, and seduce the client instantly. For a lot of advertisers, newspapers charge too much. Worse, a lot of advertisers know that the real price for big clients is often only 30% to 40% of the rate card price. This is poison.
What are we waiting for? Go to the market with new and realistic prices. Do it fast. Help your clients save their advertising budgets, help them get better results, use the success of the best cases over and over again, and tell your board you're fighting for the survival of the company. But arm yourself wisely. This is not the time to fight with the same soldiers as yesterday. You need fast people, a realistic rate card, and powerful organisations that can handle a lot of change. For those who are convinced that you need to keep the price high, the products almost the same, and the people the same: Accept the warning that too much optimism can kill. If you believe this storm will fly over, you might be a risk for your company.
You still have time to make a crisis plan in sales.
And yes, this also applies to subscription prices. All of Europe is in crisis. Our customers will feel it, the rest of the world will feel that a market as rich as Europe will consume fewer of their products. We are not yet ready to become a medium for the rich only.
Be realistic, and act! Please.