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Recession proof businesses: myth or reality?

November 18, 2008

recession-cartoon

Is there such thing as a recession proof business? I must admit, I’m beginning to think not so much. Especially if gambling, tobacco, entertainment, and alcohol businesses are feeling the economic pain.

Newsweek columnist, Dan Lyons, has an excellent post touching upon the issue, which is a must read for all PR reps: Flack Watch: “This downturn is going to be good for us.” After all, we work with clients who occasionally seem to think their products and services are 100% recession proof. Worse than that insular belief is the notion that any business press reporter would care. From Dan’s post:

“As we head into the maelstrom of another economic downturn, flacks and spinmeisters will be rushing out to tell the world why the bad times are actually good for their companies. I’m already hearing people deliver some version of this, including the one that while many companies are going to get crushed, this particular company won’t suffer, because they possess the magical Anti-Downturn Potion, or they’re living inside the protection of an Economic Distortion Field. Some go a step further and even say the downturn could be a wonderful opportunity.”

It’s up to us to challenge our clients about the recession proof message: dig for more information to support the claim, even if your client is private, encourage them to share hard numbers, speak with one of your client’s c-level buyers for more perspective (heck, maybe they’ll give a gem soundbite – “our budgets are being slashed across the board except for in the areas of [enter client industry]).”

For example, we’ve heard the rosy claims from SaaS clients (i.e. low cost, per seat, predictable revenue streams, etc.) but it’s difficult to bring that to a savvy reporter when the poster children of the SaaS market are far from immune and struggling just like the big tech bellweathers.

As the eyes and ears to what is being discussed in the media, it’s no longer sufficient for a VP of Marketing to say “travel budgets are being axed, we offer video conferencing solutions, therefore, our business is just fine thanks” and think a reporter would run with that. The media has heard it all before. And, according to Dan, they’re not buying it anymore.

Encourage your clients to bring a fresh and honest approach to the recession proof story. Whether it’s an “experienced” client who was around in the previous down economy, learned from that, retooled the business and prepared for the next slowdown (i.e. NOW) or a start up (remember – Google and Yahoo! basically began in economic slowdowns) who is lean, focused on a specific “cottage industry,” that’s one way to begin open the media conversation.

Please don’t open the pitch with “We’re in the funeral parlor business. Everyone dies someday so we’re safe…”

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