10 ways to thrive during a recession
Running a small creative business is a labor of love that requires resilience, creativity, and adaptability. When economic tides turn and a recession looms, it's essential to have a strategy in place to not just survive but thrive. In this blog post, we'll explore practical tips and strategies for small creative businesses to weather the storm and emerge stronger during challenging economic times.
Diversify Your Offerings One of the keys to thriving during a recession is diversification. If your business primarily offers a single product or service, consider expanding your offerings. For example, a graphic designer could also offer online courses, template designs, or consulting services. For example, during December when school workshop are done for the year and it's too hot for murals, I put all my energy into drop shipping and artwork sales leading up to Christmas. Diversifying your revenue streams can help cushion the impact of economic downturns.
Focus on Your Niche In uncertain times, it's crucial to refine your niche and cater to a specific target audience. Specialisation allows you to become an expert in your field, making you more appealing to clients seeking specialised services. Tailor your marketing efforts to reach your niche audience effectively. Don't forget to acknowledge your current audience - your mailing list is full of people who love what you do and want to hear from you.
Refine Business Processes Yes. This sounds boring. Now is the time to refine your marketing funnel, automate your emails and set up a automated booking system. Revisit your website and online sales points. Make sure the processes for your buyers is streamlined - as easy as possible. Then once the sale has been made, automate the emails so the buyers are likely to buy again. Set up abandoned cart emails. Offer a freebie and have a funnel of emails that follow. Now is the time to view your business from your target markets position and refine your processes.
Cut Costs Wisely During a recession, it's essential to evaluate your expenses carefully. Identify non-essential costs that can be trimmed without compromising the quality of your products or services. Reevaluate your suppliers, negotiate better deals, and look for ways to optimise your operations. Visit your local canvas store and see if they can offer you a reduced rate in bulk. Go through your business bank statement and unsubscribe from obsolete apps and programs. Do you really need a Calendarly paid account when your Wix website will take bookings for you? This is the question I am currently asking myself.
Customer Engagement and Loyalty Maintaining strong relationships with existing customers is more cost-effective than acquiring new ones. Engage with your customer base through personalised communication, loyalty programs, and exceptional customer service. Happy customers are more likely to refer your business and become long-term clients. Also get in contact with past clients and ask if they have any work coming up. I have found that people often think I am busier than I am and when I let them know I am available they often have work.
Offer Value and Discounts Consider offering promotions or discounts that provide real value to your customers without eroding your profit margins. These incentives can encourage repeat business and attract new customers who are looking for budget-friendly options during a recession. It could even be time for a Studio Sale to get rid of extra stock. Be careful doing this as you don't want to de-value your work.
Keep an Eye on Trends Stay informed about industry trends and economic forecasts. Being aware of emerging trends can help you adapt your business model and offerings to meet changing customer needs. Keep an eye on what your competitors are doing and be ready to pivot if necessary. A great example of this is murals. Only three years ago, mural artists were rare. During the pandemic the demand for murals increased and nowadays you can throw a stone out a car and hit a muralist!
Build a Financial Cushion During prosperous times, set aside a portion of your earnings as a financial cushion for rainy days. This reserve can help you cover essential expenses during a recession without dipping into personal savings or taking on debt. You might have heard me mention a thousand times before, it's so important to have three months of wages saved in a high interest account. The freelance life is like the tides, the money comes and goes - you need to be in charge of the consistency in your income.
Work on new projects It's quiet. Now is the perfect time to work on projects you've been dreaming up in the back of your head for years. Plan out the project, get the leg work done. When client work picks back up it will be easier to continue the momentum in this new project. Build up your stash of original artworks. Develop a new online workshop. Design a new range of prints. Get on top of your blog posts and schedule them for the next 6 months. Clean your studio. Learn how to paint with watercolour. Do that Art Therapy course. Now is the time.
Stay Positive and Resilient Maintaining a positive mindset and staying resilient in the face of adversity is crucial. Recessionary periods can be tough, but they also offer opportunities for growth and innovation. Apple was created during a recession! Embrace change and view challenges as a chance to learn and improve. Recessions don't last forever. No more than 18 months (I googled it).
Thriving during a recession as a small creative business is possible with the right strategies and mindset. Diversify your offerings, focus on your niche, embrace digital marketing, cut costs wisely, prioritize customer engagement, offer value, stay informed, build financial resilience, collaborate, and maintain a positive outlook. By implementing these tactics, you can not only weather the storm but also position your business for long-term success when the economic clouds eventually clear.
How are you using the challenges of a recession to build your business?