Don't just survive… thrive!

The New York Times recently published an article that explores what many local service providers have been experiencing for months.  The market for local services – like the overall economy – is definitely in decline.  More people are choosing to forego services or take a do-it-yourself approach, instead of patronizing local businesses.  Hair is getting cut or colored at home.  Dogs are getting bathed in the family bathtub.  Homeowners are trying their hand at minor repair and maintenance projects.

The Times suggest that many local service providers won’t survive.

Call me an optimist, but I think the current environment presents an opportunity.  Certainly, there remains a large segment of the population that want or need these services – and perhaps now more than ever.  Maybe someone in the family recently picked up an extra job or is working extra hours to help cover costs and now they don’t have time (or energy) to cut the kids’ hair, bathe the dog, or fix the leaky faucet.

With competition heating up for a shrinking number of prospective customers, I believe local service providers have an opportunity to reach new customers and strengthen relationships with existing customers.  Here’s how:

  1. Innovate – Try to understand what factors – other than price – may be affecting customer buying decisions.  Offer customers new or modified services that make it easier for them to continue to patronize your business (longer or different hours, pick-up/drop-off, in-home services, etc.).  Consider partnering with a complementary service provider to offer service bundles that better serve your customers’ needs.
  2. Discount – Offer pricing and bundling that shows your customers that you understand the economic challenges they face.  Discounted service bundles (e.g. “buy x, get one free”) are a great way to give customers a price break in exchange for their loyalty.  Discounts for referring a friend will turn your existing customers into a virtual sales force.
  3. Promote – During tight times, many businesses cut back on marketing in order to lower costs.  This provides an opportunity for remaining advertisers to rise above the usual din and reach more prospective customers.  Advertisers may also be offering discounts and specials to attract your business.

I believe that local service providers who are successful at techniques like these will not only survive – they’ll thrive.  And they’ll have a strong base of loyal customers in place once the economy starts to turn around.

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