Image via WikipediaAs I mentioned in an earlier post on branding, the turbulent times we live in are chock full of valuable business lessons. Here are a few more, based on what’s happened in the stock market over the past few weeks.
Fear is the ultimate motivator. The adage of “buy low, sell high” goes out the window when people are scared. What we’ve seen play out is a fundamental human truth – we would rather avoid pain than obtain gain. From a marketing standpoint, it validates the idea that a company should focus on how it can remove the customer’s pain.
People do not make rational buying and selling decisions. Emotion has as far more to do with it than some business people like to admit. A Web site or marketing piece that consists of a recitation of facts or is written in an icy, aloof tone will not be persuasive.
In chaos is opportunity. Cooler heads prevail, don’t they? I don’t like the fact that short sellers gamed the system to reap whopping profits while Wall Street and Main Street burned, but I do admire their ability to remain unemotional and execute a strategy. A business cannot afford to be motivated by fear and make irrational decisions. In times of trouble, it is all the more important to have a plan and to be creative. Have you noticed advertising lately for foreclosure auctions and financial planning seminars and gold? These are businesses that are springing up to meet a new type of demand.
As I write this, it occurs to me this may sound rather unseemly. Am I saying that a business should stay cool and collected so as to implement a strategy that preys on the fear of its customers? Am I saying that it’s OK to profit from the misery of other, less fortunate people?
No. But I am assuming there is underlying value in whatever product or service is being marketed to people as a way to remove pain.
If an unscrupulous consulting firm hoodwinks struggling people into attending an investment seminar that’s worthless, then shame on that firm.
On the other hand, if I pass on an opportunity to attend an investment seminar with valuable, actionable information, then shame on me. Which brings me to another lesson to be learned from the stock market crash -
What goes around comes around. Bubbles burst. There’s no easy money. Everything has a price. No matter how you put it, companies that offer real value succeed in the long run. Opportunists come and go, and sometimes go pretty hard.
Well, I’ve said my peace – and then some. What do you think? What marketing lessons have you learned from recent events on Wall Street?
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For me it’s still to early to say. I don’t think we’ve seen the end of things yet.
One of the bits of news I heard that most disturbed me was that a lot of trading was computerised. They’re programmed to sell under certain conditions which meant the market was going into free fall with all the computers going into panic mode. Wiser heads might have stopped to wonder whether different strategies were required.
Makes me wonder if we need to factor in how to market to computers? Or how to tell when computers are pitching to us?
Joanna Youngs last blog post..How To Use Your Web Influence Wisely
Joanna, Programmed trading does seem to contribute to market volatility, but I don’t understand the mechanics. I do know that here in the States we get computerized telemarketing calls, where the voice is actually a computer. Do you have that? It’s very annoying and I can’t believe it works.
Brad Shorrs last blog post..What Can the Stock Market Crash Teach Us about Marketing?
Brad,
here in Germany we have these computerized telemarketing calls as well, and every time I get such a call I immediately stop the call. But I don’t know how other people react…
Ulla Hennigs last blog post..The last Flowers of the Year
Hi Ulla, I’ve never heard anyone say they like or respond to these computerized calls.
“From a marketing standpoint, it validates the idea that a company should focus on how it can remove the customer’s pain.”
I was discussing this with a friend and business contact yesterday. He said that he was sick of pitches to him offering him “the way out of this current crisis” type things. We know from news coverage that a lot has to be worked out before anyone can offer that meaningfully. He decided that for his business the next e-mail to clients might run along the lines of “how to still have fun while everything seems doomed.”! He is by no means belittling the seriousness of the situation – just pointing out that piling gloom onto gloom is probably not helpful! I like his thinking….
Jackie Camerons last blog post..Word of the week – gratefulness
Jackie, There’s much to be said for that point of view. I’ve written a few times about “financial pornography”, which just adds fuel to the fire. I’m hoping my cartoon business picks up – we all need a break from the news!
Brad Shorrs last blog post..What Can the Stock Market Crash Teach Us about Marketing?
Brad, I completely agree with you. During these times it is imperative to keep a cool head. As business owners we can thrive if we truly take time to understand our customer’s problems and solve them. That could be through changing our offering to meet the current need or creating new offerings but if we panic we will act out of desperation. One of the biggest challenges I am facing is the environment created in this climate. People are fearful even if they have not been touched by the economy. It is driving irrational decisions, or paralysis.
Karen Swims last blog post..Come on Big Head, Let’s Roll!
Hi Karen, You are in a particularly difficult place, being that so much hinges on automotive. It is hard to stay calm when you feel so viscerally threatened, which is the feeling I get when I visit your neck of the woods. But this environment can’t last forever, even though it seems as though it will. Luckily there are positive people around like you to do provide some relief and encouragement.
Brad Shorrs last blog post..Thank You, Word Sell Commenters