1. Adjust your billing cycle.
2. Adjust your pricing strategy.
3. Adjust your collections processes.

[These links are anchors to the sections below.]

1. Adjust your billing cycle.

If your business typically bills net 30 after you deliver your product or service, it’s like you’re loaning your customers money for a month. That might make sense when the economy is booming. But when it’s slow? Not so much. You can help keep the cash flowing by billing net 15 if you normally bill net 30. Better yet, ask for a retainer or a deposit up-front. You bad debt expenses should go down, and you’ll have more cash on hand. (Yes, you may lose a customer or two. But do you really want customers who can’t afford to pay net 15?)

2. Adjust your pricing strategy.

It’s a cliché, but it is all about volume. A small price increase across a wide customer base can put a lot of new money in the bank. Of course, you have to be strategic. Make slight adjustments. Make sure your prices remain competitive. And if customers ask, you can honestly say that your prices should be even higher.

3. Adjust your collections processes.

So you’re a nice guy. Or a nice gal. You’re forgiving. Understanding. Sympathetic. Well, get over it! In a recession, you can’t afford to be “nice” when it comes to collections. Stay within the law, of course, but be aggressive when it’s time to collect overdue accounts. Hire a professional collection agency if necessary. Need some incentive? How’s this: the money you collect today may be the money that backs your paycheck tomorrow. I hope these tips will help you keep the cash flowing in your business…no matter what the economy is doing.

The higher level of competition will result in decreased profitability for marketers, partly because of higher advertising costs and partly because of lower prices needed to win customers. Bonatti says, “[s]o while online advertising certainly has the potential to drive out traditional advertising, it does not necessarily follow that online advertisers will make more money.”

Bonatti suggests that online ad effectiveness will vary by industry. “You can make a lot of money through super-powerful targeting if you are a monopolist, but not in a competitive market.” These findings are important to consider with respect to the CPM (cost per thousand impressions) that ad networks are commanding for specific industries. In the last three quarters of 2009, costs increased for food, entertainment, and real estate marketers. For example, food marketers saw their CPM impressions rise from $1.50 in the first quarter to $6.94 in the third quarter.

This topic is too complex to fully analyze in a blog post, but Bonatti’s take-away message can be easily summarized. Marketers will need to review their industry and their targets as they shift part of their ad budgets online. In some cases, it may be more cost-efficient to stay with traditional media.

[Source: MIT Study Debunks Online Ad Advantages, marketingcharts, December 2009]

Here’s what the research shop sees happening in the local media market in 2010.

Search Market Recovery – The increased activity in the market will mean higher costs for advertisers active in paid search.

Yellow Pages – These publishers will seek to diversify their products and may move into mobile search.

Local Broadcasters – These business will operate from a position of strength with their expertise in local brands, content and sales forces.

Vertical Ad Networks – This rapidly changing channel may find money in hyper-local sites and local lifestyle networks.

Twitter/Facebook – Analysts expect social media outlets to monetize their models by offering geo-targeted audiences.

It’s too soon to tell which of these predictions will prove most accurate. But businesses looking for new ways to reach customers in local marketers have no shortage of options to try.

[Source: BIA/Kelsey Analysts Identify Key Local Media Trends to Watch in 2010, Company release, January 2010]

Online consumers who write blogs:

18-29 year olds: 15% (down from 24% in December 2007)
30+ year olds: 11% (up from 7% in December 2007)

Online consumers who use Twitter:

12-17 year olds: 8%
18-29 year olds: 33%

Online consumers who use social networking sites:

12-17 year olds 73%
18-29 year olds 72%

All online adults 47%

These statistics point to some interesting trends. Ben Parr, writing for Mashable, suggests that the younger audience’s shift away from blogs and teens’ lack of interest in Twitter may mean these age groups don’t want to create content. Perhaps younger consumers lack sufficient time or an audience for their blogs. Parr may be correct that the average teen is not interested in reading lengthy personal posts. If that is the case, we have to wonder why teens aren’t flocking to Twitter, the perfect venue for brief posts. The reason may have to do with the media rich environment that social networks offer teens. In addition to writing brief comments on friends’ pages, teens can also view videos and upload photos. Until additional studies reveal exactly why teens find certain online destinations more appealing than others, marketers would do well to reach for younger audiences through social media sites.

[Sources: Parr, Brent. Teens Don’t Tweet or Blog, Mashable, 2.3.10; Social Media and Young Adults Summary, Pew Internet and American Life Project, 2010]

Marena Studios creative approach for the site’s model was simple. Communicate to the user and owner that “No fee=No Brainer”. On the home page the USP’s of going direct is portrayed through a series of lighthearted banners. The overall design of the site is clean and contemporary with a focus on longevity and ease of use.

The studio is also designing all the supporting collateral materials to help launch the site, so be on the lookout for Urban Edge branding in your neighborhood!

Check it out, tell your friends, find a new NO FEE Apartment, save some bucks!

Site is live but still in Pre-Launch phase    http://www.urbanedgeny.com

During last year’s recession-riddled Christmas season, the average online order value dropped by 20% compared to 2007. However, this year has seen a surge with average order values increasing 94% compared with the same period last year.
The number of items that are purchased per transaction has also increased over the last couple of years, from 2.7 in 2007 to 3.7 in 2009.
“What is interesting about this year’s benchmark data is how U.K. consumers are clearly feeling much more optimistic about the economy than last year, with the average value of an order up 94% in just twelve months,” said Coremetrics’ Richard Shepard, VP for Europe, the Middle East and Asia.
“The recession has had a huge impact on online sales, but the Benchmark figures demonstrate that more shoppers than ever are going online in search of great deals.”
A recent study by PayPal U.K. discovered that even Brits who live in the country’s large cities, close to high street stores and shopping malls, are shopping online in increasing numbers.

The ad industry is expected to recover in 2010 and the out-of-home segment should continue to grow.
Consumer groups continue to fight billboard placement and are pressing government officials to more strictly regulate the industry.
Digital out-of-home networks are often locally owned and operated but as the industry matures, consolidation is expected.
Retail, airport and entertainment districts are growth venues.
More out-of-home operators may allow users to stream user-generated content in the future, a move which could increase the appeal of this media format.
The Industry Marketing Insights report for Display Advertising Services is available on Ad-ology.com (Research Store) for $295 USD with local market data for any U.S. market.

[Source: Ad-ology Research, December 18, 2009]

“The economic cycle has reached bottom—at least for the online ad industry,” said David Hallerman, eMarketer senior analyst and author of the new report, “US Ad Spending.” “While spending in the first three quarters of 2009 fell by 5.3%, according to the Interactive Advertising Bureau and PricewaterhouseCoopers, eMarketer’s estimates indicate a smaller loss during Q4, of 2.5%.”

The various components of online advertising react differently to cyclical and structural changes. While one format might show relatively healthy growth in the recession, another suffers due to the same economic climate. For example, paid search will grow by 2.2% in 2009, while classified ad spending will decline by 30.2%. Even during 2010 and 2011, eMarketer projects search will continue to grow at mid-single-digit rates, while classified spending will decrease again both years.

Video ad spending growth will far outpace any other online format, running in the 34% to 45% range from 2009 through 2014. These extremely high growth rates are the result of video ads moving from the sidelines to center stage, becoming the main form of brand advertising in the digital space.

“US Ad Spending,” conducted by eMarketer, December 11, 2009. Website: www.emarketer.com.

WebVisible analysts note that the typical small business used 55 keywords in their search campaigns in Q3 2009. This compares to the 43 keywords the typical small business used in Q3 2008. Analysts expect the number of keywords and general complexity in small business search campaigns to grow though they have a way to go to reach the thousands of keywords employed by large advertisers.

The WebVisible survey also revealed significant differences between small business types when it comes to search marketing and the number of key words used. Here’s a list of businesses, their amount as a percentage of total advertisers using search, and the average number of keywords used:

Attorneys/Legal Services 7.68% (105 keywords)
Dentists 4.97% (74 keywords)
Air Conditioning Services 2.63% (55 words)
Physicians & Surgeons 2.03% (57 words)
Insurance 1.97% (69 keywords)
And what are businesses getting in exchange for this activity? Once a small business spends over $100 in a quarter on a search marketing campaign with good keywords, the click through rate (CTR) is 1% or higher. CTR leads to conversion action on the marketer’s Web site of 32%. Conversion actions range from submitting an e-mail to bookmarking the page to viewing a video. With results like this, it’s easy to see why so many small businesses expect to increase their spending on search marketing in 2010.

[Source: State of Small Business Online Advertising Q3, WebVisible, Fall 2009]

About half of small businesses, 56.6% of those with fewer than 11 staff members and 48.2% of those with between 11 and 100 staff members, will not use online banner advertising in 2010. The VerticalResponse report also indicates that small business owners are relying less on media formats such as TV and radio. Nearly 80% of survey respondents say they do not plan to use TV next year and 72.7% do not plan to use radio advertising.

As small business operators take actions similar to those employed by larger firms, VerticalResponse CEO and founder Janine Popick believes “marketers need to help small businesses to see the value of integrating search engine marketing such as Google, Yahoo and Bing into their campaigns.”

The shift from traditional to newer forms of marketing will result in some cost savings for small marketers. For example, social media and email campaigns can cost significantly less than TV and radio. However, paid, integrated search engine marketing can be expensive, especially if the campaigns are not carefully targeted. Marketers who efficiently deploy and manage search engine campaigns stand to gain market share and improve profitability in 2010.

[Source: State of Small Business, VerticalResponse, Fall 2009 release]