Business growth is at risk, and if companies are not properly prepared and equipped, maybe even survival. But within this risk environment there are opportunities and technologies that can help and, in many cases, allow companies to thrive.
Strategic Positioning in the Past
We’ve seen challenging times before, and yet, enlightened companies emerged and positioned themselves for accelerated growth. It was during the 2008 – 2009 downturn that a strategy of prioritizing adoption of emerging technologies helped companies emerge strong and ready for growth.
In short, winners pulled away from losers. A recent study by Bain & Company looked at over 3,900 companies and found that the winners grew at 17% when the storm hit and locked in gains of 13% post-recession while the losers grew at 1% post recovery.
These winners didn’t exclusively look at technology adoption. They also focused on the cost of transformation. However, the critical component of success was the accelerated investigation and adoption of technology.
Surviving and thriving in a downturn has changed.
Since the last downturn, the market has seen an explosion of marketing and sales technology to the point that there are few businesses that aren’t already digitally adapted. Advances in platforms have affected companies’ abilities to address customer needs, empower internal teams, and supercharge sales and marketing teams. Advances in cloud computing have changed the landscape for businesses of all size. Machine learning has allowed companies to predict and adapt to an ever-increasing amount of customer data and optimize expenses. Accounting technologies allow companies to better manage working capital. Sales and marketing automation software allows companies to better optimize key marketing programs driving revenue.
There used to be a couple of levers a company could use to manage its business to cut costs, cut human resources, increase sales, and optimize internal processes. With the advent of much of the new available technology, it can be difficult to increase the effectiveness of each lever.
Investing in Technology Today
There is a caveat, however, to the ability to use technology efficiently and effectively. If the company is a laggard as it relates to its digitization, it is likely to invest significantly less and be less successful than those that are leaders in digital adoption during a downturn. A recent KPMG study found that digitally leading companies were more likely than non-digital ones “to make additional technology investments because of the pandemic — with 50% more organizations that are ‘very’ or ‘extremely effective’ at using digital technologies spending an additional 21%–50%.”
Investing in technology can help mute or eliminate the effects of a downturn and create an environment for growth during and post-downturn. But where should companies invest? Is it in gaining efficiencies and simplifying complex processes via automation? Increasing sales and optimizing marketing capabilities with real-time responses? Or accounting and working capital solutions that help manage finances? The answer may be specific to whether you are a B2C or B2B company.
B2C companies that employ significant marketing resources to drive prospects and convert them into paying customers should remain forward focused on the customer/prospect and ensure continued E-commerce investment. Web storefront conversion technology, customer service tech, and solutions that can better inform on marketing attribution are best bets for investment.
For B2B companies, our specific area of interest, the question is a little more complicated and depends heavily on the state of your current tech stack and your sales model – whether direct or via a sales network.
Direct Sales and Sales Networks
If a business uses a direct sales model, solutions that automate any area of the lead or sales process and drive marketing optimizations can be critical for investment. Employing sales and marketing technology during downturns is a sound strategy and takes on an added urgency versus when times are robust and the rising tide that is economic expansion floats all boats.
If a business relies on a sales network, technologies that can easily be adopted and used by sales partners are key. Adding to their tech stack can be fraught with challenges, but lightweight cloud-based solutions that focus on driving sales from the network and don’t rely on a deep integration or extensive training will amplify sales efficiency.
Either way, businesses need to considering positioning for amplified expansion when emerging from the downturn, assist in retaining key sales team members, and have greater visibility to performance during times of uncertainty.