“The higher man is distinguished from the lower by his fearlessness and his readiness to challenge misfortune.”― Friedrich Nietzsche, The Will to Power
Uncertainties have always been among us, as they imply a gap on our own interpretation of reality. According to Dr Joshua Wakeham “uncertainty occurs at the limits of knowledge” and as human beings our understanding of reality will always be limited.
The image below shows how Australia has been able to handle economic uncertainty over the last 70 Years
Source: ABS Consumer price index
As you can see we shouldn’t be unfamiliar with uncertainty but if we are supposed to be able to deal with uncertainty, why every time something unordinary or exceptional happens, like the a recession, businesses tend to panic?
In general this happen to a lack of understanding on fundamental principles. Here’s a summary of the most important ones.
Strategy vs Tactics
Understanding the difference between strategy and tactics is crucial to marketing success during uncertain times.
“we’re going digital” — Source: marketoonist.com
Strategy
Is the big picture planning you do prior to start any type of work. It is the blue print that will allow you plan everything out. (Big like revenue goals and small like like your value proposition for certain audience)
Goal: We want to sell more productsStep 1: To sell more, We need an active audience willing to buy our product.Step 2: To build an audience we need to build a targeted email data base , segmented by different the different stages of their buying journeyStep 3: To build a targeted email database, we need to acquire relevant user to our website.
Tactics
Tactics are specific actions that help you implement your strategy. Your tactics can change regularly, based on multiple factors (Results, Market Changes etc) but strategies tends to stay the same.
You won’t be able to succeed without both strategy and tactics
Strategy without tactics leaves to paralysis analysisTactics without strategy leads to the shiny object syndrome
Analysis Paralysis
Technology has brought us more information than we can handle, when unexpected events happen , such as a recession, the production of all types of information disproportionately grow and most people tend paralyse due to information overload (with too many opinions it is almost impossible to identify the right one)
As a result of this, business executives find it difficult to make unbiased decisions and tend to go for impulsive/short-sighted decisions that negatively impact their companies resources and long-term growth.
Source: The Sweet Spot on the Curve
The image above is a representation of Barry Schwartz Paradox of Choice, and shows how an individual exposed to too many choices has a low probability to make a good decision due to anxiety.
Shiny Object Syndrome
shiny object syndrome — Source: marketoonist.com
The concept of “Shiny Object Syndrome” in Business is used to describe the tendency for executives & stakeholders to constantly chase new ideas without thinking them through.
The main issue businesses face when prioritising tactics without strategy is an impulsive decision making process led by distraction and implemented by executives looking for short term satisfaction.
According to an academic paper from the Oxford University Research Archive
“The news industry has a focus problem. ‘Shiny Things Syndrome’ — obsessive pursuit of technology in the absence of clear and research-informed strategies — is the diagnosis offered by participants in this research. The cure suggested involves a conscious shift by news publishers from being technology-led, to audience-focused and technology-empowered.”
While, so far, we have never had to deal with a situation like this (an economic recession of this scale), disruptions and all types of uncertainties we have been tackled before and have taught us that more often than not, businesses are able to adequately response.
Here are some interesting facts that will help you make a more strategic decision when dealing with uncertainty
Tech companies have been able to survive the last 2 biggest economic recessions. According to Tim Bajarin “Big Tech survives recessions and always comes out stronger”
Facebook Revenue Growth since 2008 Source: Yahoo Finance
If we look into the dot-com bust of 1999–2000, for example, most tech companies went through a though period , however the biggest losers were companies that got funded without a functional and validated business models that didn’t show a clear path to making money.
From 2002–2008, we saw companies grow in a more structured way and only got funded once they validated their value proposition, business model & marketing channels. During this period, companies like Facebook, Twitter, Uber, and many others took off and started the tech boom that continues even today.
Businesses must know that it is not impossible to come out of challenging times.
Here are a few tips that will help companies survive through uncertain times.
Understand the Science Of Change
The Science of Change — Source: BCG Henderson Institute
Business Leaders across the globe recognize that without a clear adaptability plan business will set themselves for failure
According to the BCG Henderson Institute
Creating a businesses that encourage adaptability will be a challenging journey and will require businesses to reinvent themselves creating hybrid learning enterprises that synergistically combine humans and technology
Develop a Concrete Marketing Strategy
1 page marketing plan — Source: https://successwise.com
When tackling any type of disruption a concrete strategy based on research, planning, and capacity will always help. However most executives lack of a systematic approach to develop strategies matching strategic styles, industry conditions, business functions and the addressable market.
Luckily there’s a framework you can use to easily map out your entire marketing strategy on one page.
Just determine the specific activities you’ll prioritize at each step of the marketing process
How would you define your niche target market?What sort of message will resonate to your target market?What media would you use to reach your prospects?How do you capture leads?How do you nurture those leads?How do you convert prospects into customers?How can you create a remarkable customer experience?How can you increase your customer’s lifetime value?how can you incentivize a targeted system for referrals?
Remember in times of disruption, only companies that do not lose sight of their long-term vision are able to survive
Identify Trends and Realign Your Business to Achieve Optimal Outcomes
<iframe width="560" height="315" src="https://www.youtube.com/embed/6HzdOkPPPRU" frameborder="0" allow="accelerometer; autoplay; encrypted-media; gyroscope; picture-in-picture" allowfullscreen></iframe>A proactive approach when handling uncertain times is essential to understand the impact of a potential disruption and quickly design a reaction plan where needed.
It is a must for businesses to be across industry new trends & be ready to pivot their organisation efforts in a timely manner to take advantage of these trends before the competition.
To be ready and always ahead of your competitors you must develop processes tools and procedures to make innovation an essential part of your business
Companies prepared for future scenarios in advance will get better results
Take Linearity & Other Cognitive Bias Into Consideration
Linear Thinking in a Nonlinear World — Source: hbr.org
Companies and businesses keen on surviving disruptions must make sure to stay wary of linear and other cognitive bias. This basically means that most people tend over simplify business problems, especially in difficult times, which might represent significant losses.
As an example, let’s look at how the profit of a company dependent on multiple variables, but most people only look at corelation between 1 or 2 popular ones like cost, price, or volume.
As humans we tend to oversimplify complex scenarios and let our cognitive biases to affect our decision making process. Always ask why a phenomenon occurs and try your best to fight best practices and commun knowlegde
The Final Word
These are uncertain times, and no one knows what lies in store for the world economy and businesses around the globe. But by understanding the dynamics of change and the principles of human behaviour (marketing) companies have a framework that allows them to rapidly adapt, survive and grow.
If you are a startup in the middle of a storm, remember not to panic and focus your efforts in providing real value to a selected group of people.
Previously published behind a paywall on Medium.com