As a CEO, one of the best things you can do for your business during a recession is focus on growth.
Only by achieving profitability — plus a comfortable safety net — can you long-term weather market fluctuations and control your own destiny. Other sources of financing (equity, debt, crowdfunding, cost-cutting, etc) are uncertain, come with tradeoffs, and are mostly useful for buying time to achieve the real target: revenue.
These are our recommendations for growing revenue thoughtfully and sustainable during a recession.
5 Ways to Grow Revenue in a Recession
1. Prioritize Existing Customers
Existing customers are likely to be the biggest source of new revenue for scaling companies (SaaStr). And, most importantly, you need to make sure your customers do not cancel. This is a time when everyone is reviewing their budgets and cutting non-essential tools.
You need to make sure that your customers continue to see the value in your product. We recently wrote this article on the best way to check in with customers… The key things to keep in mind are to (1) provide real value, and (2) build human relationships. Personalized video emails here can have a huge impact.
2. Be Empathetic
Everyone is dealing with additional stress right now. Maybe their business is struggling, or maybe their personal portfolio dropped 50% over the last year. You don’t know. So when you reach out, be especially considerate.
Also, know that your messaging will adjust over time. The words you say to be empathetic today might feel stale next week. Continue to stay tuned to what’s going on and adjust.
3. Adjust Your Terms
Depending on the stages of both your company and your client’s, you might value different things (immediate cash vs long-term predictable revenue).
Learn what matters most to your new and existing companies so you can adjust your terms in a way that’s optimal for both parties.
For example, you might want to offer a customer a lower rate with an upfront payment, so you can get more cash in the business today, and they can save money over time.
4. Run Growth Experiments
Launch a new growth experiment every day. Prioritize quick experiments, so you have fast learning cycles.
Counterintuitively, pushing for higher quantity can be more effective than focusing on higher quality alone. This is because you have faster feedback cycles, so you can improve at a much faster rate.
There is a famous parable from Art and Fear that goes like this:
Releasing a new feature every day is hardly sustainable, but have your team put out something: a new video email campaign, a new customer testimonial, a new blog post.
Release frequently, and measure everything. Especially if you have limited runway, high quality, fast learning is essential.
5. Be Efficient
You have to do more with less. It’s up to you to find the perfect ratio between cost, time, and impact for each project.
As you prioritize potential projects, think about (1) which will have the largest impact in the least amount of time, and (2) which will have the largest lasting benefits, so you can put “future you” in a good position.
At Sendspark, we've taken this to mean:
- Releasing a new feature to let customers create personalized videos at scale, so you can have a larger impact with less time / effort.
- Focusing on projects serve multiple functions. For example, we just created a YouTube playlist on how to use Sendspark. This has multiple benefits: (1) onboarding new customers, (2) driving organic traffic, and (3) serving as thorough responses to support questions.
This is a challenging time for sure, but also an opportunity to be a better leader. To react quickly, and set a new precedent. To set a new path to sustainability. To control your own destiny. Rise up to the challenge, and enjoy the ride!