In a recent article on bnet, the CBS Interactive Business Network, CEO Dian Griesel of Investor Relations Group in New York City offers an interesting perspective about the challenges of building a small media consulting business in the midst of a recession titled, “My Recession Wake-Up Call: It’s Time to Change or Die.”
I have often referenced the case of the Depression-era breakfast cereal wars that saw Kellogg best Post for decades because it had the vision to invest in marketing instead of cutting their ad budgets ("Hanging Tough,”The New Yorker").
Griesel’s firm had the guts to make such strategic investments in her business with no guarantee of a return on the investment at a time when their revenues had already taken a beating. Now that’s the spirit of entrepreneurialism, as described by Griesel:
In 2007, just as we were getting started with our new media initiatives, the economy tanked. Our revenue dropped 80% — from $6 million to $1.8 million. We laid off eight employees out of 30, and didn’t have a lot of spare cash. But at that point it was change or die, so we went ahead with the investment. I didn’t know much about new media, and the learning curve was steep, but in the end it paid off.
It shows current clients that we are capable of handling not only their traditional PR needs, but their social and new media campaigns as well. Over the past year we’ve increased the amount of work we do for most of our existing clients by working to develop new media campaigns for them.
The more important lesson from Griesel’s experience? Making a major mistake and learning from it.
We made at least one crucial mistake when I decided to bring my PR firm into the 21st century: We outsourced the development of our new website. It turned out to be a terrible idea. The result was professional, but generic. It failed to give a sense of who we are. So we cut our losses, scrapped the whole project, and recreated the website ourselves. It cost us an additional $25,000, but we were now in complete control of our message.
In managing limited resources we sometimes set the bar too low for success. For instance, when overhauling a Web site (whether a client’s or your own), was your account team impressed with the mock-ups of the design and architecture of the site because it was such a vast improvement over the previous site, or because it was exceptional as a stand-alone site which would impress anyone who matches it up against a similar, competing site?
Unfortunately, I have learned the hard way as well, but have also been willing to scrap the lower standard and demanded better for ourselves and our clients.
Griesel’s lesson is simple. Sometimes to get the job done right you have to do it yourself – even if it means losing in the near-term because you are confident that it will result in success in the long-run.
This is a cross post from the ProBlog at www.proactivecommunications.com