Have you noticed an unexpected drop in sales or new clients?
If you have, you’re not alone. It’s a challenge, which business owners regularly reach out to me for help with. Their sales numbers are down, but they haven’t changed anything. And they’re looking for answers.
If this is happening to you, or you want to stop it from happening to you, today’s post contains a few of the most common culprits, along with some ideas on what you should do next.
So, what gives? I’ll explain in a moment.
But first… the elephant in the room
The economy is certainly in bad shape. However, it’s in bad shape for all your competitors, too. And as you probably know, there are businesses in every sector, doing massively better than the rest. Many have thrived. I know this, because I’m working with them; making them as compelling and valuable as possible.
Here’s what we know. When times are rough, people think a lot harder before they spend their money or their budgets. They spend it were they see the greatest value. The most compelling provider wins. And they win big.
Now, let’s look at some very common reasons for an unexpected drop in sales.
Advertising roulette
This is becoming a huge problem for small businesses.
Someone is out-bidding you for online ads (GoogleAds, Facebook Ads etc.). So, the prospective clients who would have clicked on your ads are now clicking your competitor’s ads. You can also experience the same drop, if a competitor has created a more compelling ad.
In either case, they get your buyers or client enquiries. In 2023, advertising (buying sales) is a spectacularly risky way to grow a business. It requires constant monitoring, eats into an indeterminate percentage of your yearly profits and is extremely volatile.
Better competition
A new, agile competitor has arrived, or an existing competitor has hired expert marketing help. In either case, your clients and prospects are now being expertly marketed to, with compelling messages that grab their attention and convert them into paying clients.
Consequently, a number of the sales leads or client enquiries that would have been yours, are now theirs.
A well-funded competitor
A well-funded competitor is targeting your clients and prospects, offering very low prices. The competitor usually commits to losing money for between 6-months and 24-months, in order to gain as much market share as possible. They also bank on a number of their competitors going broke. When handled correctly, this strategy can be extremely effective.
Well-funded businesses, ranging from independent coffee shops to international service providers, are increasingly using this ‘last one standing’ approach.
Value proposition jump
A competitor has found a way to significantly increase the value of their products or services. And it’s selling like crazy.
So, even though your quality or range of services is just as good as ever, it’s no longer as compelling, when measured against the newly improved competition.
What’s the answer?
The threats I’ve just shared with you are only a few of the more common ones. The key is to do some research. Identify what’s happening, then put a strategy in place to overcome it.
The best advice here is this: Be proactive.
For example.
- Massively reduce or eliminate your reliance on paid advertising. I haven’t spent a penny on advertising since the 1990’s and you don’t need to either. It’s essential that you regain control over getting your sales message out there and acted on.
- Don’t wait for an agile competitor to turn up, before you seek to increase your value to the marketplace. Do it now. It’s easy. And you’ll win big. I can usually find 5 ways in as many minutes.
- Adapt fully to whatever challenges the economy is throwing at you. When you do, you’ll not only grow your business, you’ll have a bigger slice of the marketplace. Why? Because your fearful competitors will be hiding from reality in their comfort zones. Scared into inaction. Actually, scared stiff.
- Get a marketing strategy for your business, which a well-funded competitor can’t penetrate. Then, build a wall of financial security around your business, which a well-funded competitor can’t penetrate. Grow your business. Get stronger financially. Repeat.
- Become an engaged observer, so you know exactly what you’re competing against. It’s never been easier. Social media lets you see what your marketplace is saying about your competitors. Competitor websites and competitor social media accounts show you what you’re marketing against.
- Come on. In the past, business owners had to guess. You can just take a look and see what’s going on!
In business, everything happens for a reason. If your sales numbers are down, once you identify why, you can adjust accordingly and turn things around.
This holds true in every economy (including this one) and for every small business owner (including you).