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Predictions for 2009

Predicting emerging trends and changes that will shape the coming year has become the fashionable thing to do. So I figured I'd try my hand.

Here then are some trends I think will affect small businesses during 2009.

1. The Economy - Turmoil and a Golden Opportunity

Well, duh! Right? Obviously the weakening economy is a major factor for businesses of all sizes and has been a concern for most of 2008. That's hardly news and hardly a prediction.

But what is news is the ever-increasing severity of the situation; a situation that looks only to worsen in 2009. And my prediction is that this will present the opportunity of a lifetime to savvy business owners.

Unemployment is rising. Spending is down across all sectors of the economy (except of course the public sector which is spending like there's no tomorrow). Credit is effectively unavailable. Balance sheets look like hell (at both the corporate and personal level). Clearly, we are in the midst of one heck of a correction.

So the situation looks frightfully bleak for 2009. Consumers will be strapped for cash, many people will be out of work, and businesses, starved of sales, will go bust. Happy New Year, everybody!

But in this calamity, there is also opportunity.

There is always business to be done. People won't stop needing things. People won't stop wanting certain things either. And with nearly 7 billion people in the world, there will still be a lot of needing and wanting.

Business has never been about "beating" the economy. Actually, the economy is largely irrelevant. It's like the field a football team plays on. Football is played against the opposing team, not against the field. Different field conditions may influence a team's strategy and tactics, but it cannot influence the outcome. Only the teams can do that. If one team wins and another loses, it is the strategies, tactics, and talent of the teams that determined the result, not the field.

Business is exactly the same. A business succeeds because it provides a needed product or service and is able to attract customers through its sales and marketing efforts. A booming economy may make life easier, but it is not the cause of the success. And a business does not go bust because of the economy. It goes bust because of its inability to beat its competitors.

With the economic tumult, it's safe to say that many businesses will not survive 2009. The good news here is that you can kiss goodbye to many of your competitors.

For the business that markets effectively, this represents an unprecedented opportunity for consolidation and, when the time comes, expansion.

The prediction is threefold:

  1. The economy will get worse.
  2. Many of your competitors will fold.
  3. You will have the opportunity of a lifetime to firmly establish your business. Whether that's regionally, nationally, or even internationally is up to you.

 2. Customers Will Become More Choosy

Whether your business is B2B or retail, customers are going to become more difficult to sell. Gone are the days when even large-ticket purchases were made in the blink of an eye. Your customers will (rightly) take longer to decide, and will need a lot more information and convincing of the value your product or service will provide them.

Good marketing is essential here. If you already market your business effectively, you have nothing to fear. Your target market has heard of you, your reputation is good, you deliver great value, you efficiently drum up leads and convert those leads into paying customers, and you relentlessly track all of your marketing activities to ensure they remain profitable. Keep doing what you're doing.

On the other hand, if you don't do that, the current conditions will be very rough for you until you change. Your mantra for the coming year needs to be "market effectively or die".

If you're at a loss as to where to start with overhauling your marketing, check out my earlier posts on marketing effectively and on 5 rules for great marketing.

Bottom line: customers won't throw their money around anymore. They'll only spend after careful consideration. You'll need to work harder to demonstrate the value you can provide them.

3. Online Marketing Continues to Grow

Online marketing has been growing for years. It got its first big boost when Google proved that you really could generate revenue cost-effectively through online advertising.

It's about to get another big boost.

For a great many businesses, online advertising is simply the most profitable way to advertise. And why not?

  • It isn't very expensive: even several dollars per click is nothing compared to the cost of running a large-scale print or TV campaign.
  • It's highly targeted: when advertising alongside search queries your ad is triggered by the keywords you choose.
  • It's easy to track: the company running the ad for you can tell you all the stats like clicks and impressions, and you can track on your website whether the click-through resulted in a conversion.

I mentioned above that your customers want value from you. Well you'll also want value from your vendors, and that is value!

With companies watching every penny they spend, existing advertisers will spend a greater proportion of their advertising dollars online while many businesses that have not yet moved their advertising online will do so.

4. The Web Becomes Truly Device Independent

The way people connect to the web has changed. It's no longer good enough to assume that they will be sitting behind a laptop or at a desk browsing your site.

Instead, they might be sitting in a park with a smart phone in hand. Or they might be at the gym using an iPod to connect. In short, they could be just about anywhere, and pretty soon they could be using just about anything to browse the web.

The list of web-enabled devices is large and growing. Cell phones, iPods, game consoles (Xbox and the Wii), radios, Blu-Ray, DVRs, and even refrigerators and cars are all being given the ability to connect.

For small businesses this means ensuring that your website works on these new devices and that, just as importantly, people are able to do what you need them to on the site.

For example, if your site uses dropdown menus in the navigation, and ordinarily those dropdown menus are triggered by hovering the mouse pointer over the navigation button, you'll need to be aware that devices like smart phones may not be able to complete the task. They can click a link, but they can't hover over a button to trigger the drop down. So you'd better have another way for the user to get where they need to go, and it had better be easy and intuitive or you'll have just lost the visitor.

5. Social Networking Becomes Mainstream

Okay, social networking already is pretty mainstream. Let's face it, every teenager in the country has a MySpace page, and even my aunt is on Facebook. But I'm talking mainstream for small businesses.

Right now, social networking for small businesses is still pretty cutting edge. How many of your competitors use Twitter? How many have a Facebook account? How many have a blog? Probably very few, if any. That's going to change next year.

The trick for businesses will be to embrace this new medium effectively. Social networking is a great tool for building, maintaining, and strengthening relationships with people. It's not an open invitation to spam your network with a hard sell.

Overall

So that's it! My top five predictions for 2009.

It's going to be a tough year for many people, but with the right business approach it could also be your breakout year.

But that's next year. For now, relax, enjoy the holidays, and be sure to toast yourself and your continued success in 2009.

Happy holidays!

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