uke Bucklin, president, Sierra Bravo Corporation, Bloomington
Sierra Bravo does the majority of its work through partnerships with advertising and marketing agencies. Our partners are telling us that while many clients are looking to reduce their expenses overall, they are typically maintaining or even increasing their investments in their Web strategies. We are seeing many partners and clients refocusing their interactive strategies on mission-critical projects and tactics designed to directly contribute to the bottom line (e.g. promoting sales, reducing overhead, etcetera).
We’re seeing that clients who budgeted for maintenance on existing sites are doing their best to squeeze some new development out of those dollars.
Some companies that are feeling the pinch have delayed projects to the second half of the year.
Typically an interactive project has a lot of flexibility in the bottom line; often companies will get responses to an RFP that differ by orders of magnitude. We encourage our partners to look at our proposals as the beginning of a discussion about the scope of a project rather than a take-it-or-leave-it offer. In many cases, the necessity to cut budget on a given project can be the mother of invention of all kinds of clever and unconventional solutions.
If more companies started the conversation with their Web partners by saying “These are my objectives. Here’s my budget. What can we do?” there would be many more great interactive campaigns out there. Its important for end clients to have a real sense of how a project will impact their business and have a plan in place to measure the results.
The key to success in any financial climate is to look to the competition and do something original and unique. It can be tempting to survey the competition and make your Web site a “best of” compilation of what your competition has put out there, but the truly successful companies are those that find a way to communicate their unique value on line without becoming an echo chamber for the activity of the rest of their industry. Specifically, I think that companies should ensure that their projects include resources to maintain and update content on their sites themselves (keeping in mind that this often means both the development of a content management system and some time from a subject-matter expert within the company). A successful Web project with any kind of shelf life will have costs both in development and in personnel over its lifetime.
We organize an event called Sierra Bravo’s Overnight Web site Challenge where we bring together nonprofits from across Minnesota with a team of Web professionals who work with them to create new sites literally overnight. It’s a great showcase for what a company could do with even just a few thousand dollars working collaboratively with local talent and cutting-edge technologies.
Priority is forecasting a busy year for our clients’ Web site spending. In general, they are executing projects planned in 2008, which are now getting underway. The economy is driving our clients to focus more on customer retention. January 2009 was one of the strongest starts to a new year in our company’s history with 20 percent of new business coming from interactive services. These projects often include a blend of e-mail and offline marketing support materials.
Although 2009 might not be the year a client revamps an entire Web site, it could be a year when they focus on building traffic to their existing site. We’ve seen a big interest in e-mail, which is very effective in driving traffic back to the site. So instead of slashing interactive budgets, we recommend looking at outdated or less targeted marketing efforts, such as yellow page ads. One client in particular was in a position to shift thousands of dollars initially earmarked for yellow page ads into their interactive budget for greater effectiveness at far less cost.
Outsourcing some Web functions can reduce a company’s overall risk by shifting the fixed expense of maintaining an interactive team to a flexible “as-needed” expense. For example, content development might be less expensive if outsourced to a few trusted freelancers (or employees who have been laid-off). Other specialty skill sets, such as Flash development, could be outsourced to a firm that focuses on that technology.
Companies can realize the best value from their vendors by consolidating interactive services with their most trusted and reliable marketing partners. The current economic situation is an opportunity to analyze vendor relationships. Focus on those with high-quality customer service who are open to collaborating with each other to create the best possible product for you. Consider hiring your interactive partner on a one-year retainer basis. This helps by locking in a price for the year. In fact, many interactive firms will offer a discount for a one-year relationship agreement.
When every other company is cutting back on marketing, it’s so much easier to dominate in areas such as search engine optimization and pay per click if you are willing to maintain your pre-recession spending. If I were to prioritize on a limited budget, I would focus on direct mail for customer acquisition and e-mail for customer retention, then test paid search or targeted ads on social networking sites such as Facebook, where you can control your ad spend week to week. Companies that view the current economic climate as an opportunity to retool, innovate, and get poised for growth will survive and thrive.
One of our larger credit union clients needed to re-architect their Web experience for their members, but didn’t have the budget to do a complete redesign. We worked with the organization and found that the IT department could reduce their fixed expenses by implementing a content management system. The organization’s departments were able to pool their resources and obtain the results they were looking for. With the right kind of upfront planning, you can invest your marketing dollars wisely.
Michael Lacey, CEO, Digineer, Plymouth
With the mix of uncertainty and fear in the market right now, we’re seeing some clients slow down their Web-related spending while others are focusing more spending on the Web in an effort to boost their presence and enhance customer service and brand awareness. We’ve recently seen a few start-ups that are developing software-as-a-service applications increase their spending in an attempt to capture market share during slower economic times.
Given current economic pressures and cost benefits of the Web, I think most companies should be increasing their investments. Studies have shown that increased investments in sales and marketing will pay dividends during and immediately after a recession. Increased brand awareness never hurts.
Unless you are in the business of Web development, I believe that it’s always smart to outsource your Web work to a firm that specializes in it. We’ve seen many cases where a company decides to build their own site, only to find that it takes longer and costs more than they originally expected.
To ensure that you receive value from a Web-development company, have your requirements very well defined from the beginning. This will allow the company to estimate your costs accurately and allows you to prioritize the features that you want on your site. If you don’t have experience developing the detailed requirements for a Web site, the firm you pick should facilitate a requirements-gathering process before estimating the project for you.
We always recommend prioritizing spending on items that will have the most impact for the users of the site and that directly enhance and/or reinforce the company’s brand. Some examples of this are customer self-service, product demonstrations, search, and customer portals.
uke Bucklin, president, Sierra Bravo Corporation, Bloomington