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While the slow economy has hurt sales at many small businesses, it’s also opened an opportunity: Consumers are more price-conscious and more willing to try new products, says Stacy DeBroff, the 50-year-old chief executive officer of Boston marketing agency Mom Central Consulting. although women in general are currently reluctant to spend, they are also less loyal to brands than they used to be, says DeBroff, whose company surveyed 900 women in its national database in July. Small businesses can lure new customers by shifting their approach to marketing, especially when trying to reach mothers who control household budgets, she says. DeBroff, who says her 25-employee company brought in $3 million in revenue in 2010, spoke recently to Smart answers columnist Karen E. Klein. Edited excerpts of their conversation follow.
Karen E. Klein: you recently surveyed 900 mothers ages 20 to 50 in your research database about their attitudes on spending and brand loyalty. What did you find?
Stacy DeBroff: now more than ever, it’s not easy to motivate moms to buy. Women control the vast majority of spending in this country and they’re cautious right now. the economic crisis has set up a bit of a Depression-era mentality in many households.
But we did find an interesting trend for small business: People are less loyal about the companies to which they take their business. only 35 percent said they are sticking with the brands they used before.
Did they explain why?
The recession really hit everybody, including middle- and upper-middle-class pocketbooks. in the past, if you could afford to buy a branded item, you’d do it. there used to be Tide families, or Colgate families. now we see that even people who can afford expensive brands are more willing to shift to less-expensive or generic brands, especially when it comes to items that they’re less concerned about trusting. So, for instance, the women we surveyed wouldn’t move to generic baby formula, but they might try a store-brand diaper.
How does that attitude help small businesses gain traction?
When they’re not so concerned about cost, people generally turn to big business. So if they need their rugs cleaned, moms who could afford it would just call Sears. now, if they’re looking to save money, they might be willing to try a small carpet-cleaning service. in our survey, 78 percent said they would gladly try a new product or service if they had a coupon. and if they give it a try and they like it, they might shift to it permanently.
Is discount pricing the key for smaller companies, when it comes to getting people to try them out?
Women today are really tuning out traditional advertising, like print ads and direct mail, and they’re turning instead to sampling, trials, and coupons. I think a key is having something you can offer that is socially conscious or has another attribute that moms value, like maybe a food product that is all-natural.
How do smaller retailers and service providers get the word out about their advantages if they’re no longer getting effective results from traditional marketing and advertising?
This gets back to the importance of peer-to-peer advocates via social media. every small business has people who buy their stuff and love it—they’re your existing customers. Figure out which of them are online and which are influential online. Do they blog? Do they have a Facebook presence? are they on Twitter? Get them to spread the word about your company and in exchange give them something—maybe a discount on their next purchase and a discount for every friend they send into your store.
