Recession-proofing Your Operation: Tips for keeping and gaining customers in a down market

Nov. 1, 2001

Recession-proofing Your Operation

Tips for keeping and gaining customers in a down market

By Bill de Decker November 2001

Many years ago, the Chairman of the Federal Reserve was giving a presentation to the Senate Finance and Budget Committee on the state of the economy. As part of his opening statement, he said that the country was experiencing a recession. The Chair of the committee interrupted him and said he did not want to hear the word recession. "Fine," said the Chairman of the Fed. "You can call it what you will, but we are in it and we better start figuring out what we are going to do about it!"

Reading the signs
All the signs say that we are in a recession today. We don’t know whether it will be a big one or a little one, but the smart organizations will follow that Fed Chairman’s advice and figure out what they are going to do about it. The obvious thing to do is to cut expenses and that’s important. The less obvious approach is to focus on marketing.

History lesson
The worst recession that affected the aviation business was from early 1970 to early 1972. Boeing was laying off so many people that someone rented a billboard that read, "Will the last person leaving Seattle, please turn out the lights."
In corporate aviation, Falcon Jet, my employer at the time, went from 50 aircraft sales in 1969 to 5 in 1971. Lockheed and Sabreliner stopped their production lines for 18 months, Learjet survived only because of its international sales and the others survived by relying on the deep pockets of their parent companies. This was also the time when I met my partner, Al Conklin. I met him when we all moved into a new building at Teterboro Airport and the offices were not quite ready. We ended up sharing an office and I quickly noticed that every day, he would go through his Rolodex, write down 10 names and telephone numbers, call them and follow up with a letter. When I asked him who he was calling, he told me that they were folks who had bought aircraft from him before as well as other prospects. When I pointed out that there didn’t seem to be much sense to that, since no one was buying, he said, "There are always some buyers and I would like them to buy from us."
The effort paid off in two ways. In 1971, Al, although he represented only 10-percent of the sales force, was responsible for two-thirds of the aircraft Falcon Jet sold that year. Admittedly, that was only three aircraft, but they were three sales we would not have had without his efforts. The second way was after the recession abated, all that hard and sometimes discouraging work paid off with Al being one of the top-ranked salesmen for many years.
There are two morals to this tale. The first is to remember that when a recession strikes, aircraft still need maintenance, but it will take a lot more work to get them to come to your shop. The second is that by diligently pursuing your prospects during a recession, you are laying the foundation for real growth when the recession comes to an end.

Gathering information
So, how can you apply this to your situation? Here are some thoughts. First, make a list of each of your current and past customers and note what type of maintenance your organization did for them. How far back you go depends a lot on what type of maintenance you do. If it involves a lot of heavy maintenance, go back further than if you do mostly transient maintenance. In any case, go back two or three years. Next, call each and every one of them and find out if they still have the aircraft, how much they are flying, who is in charge of deciding where the maintenance gets done, what maintenance they have coming up and make a pitch for bringing the aircraft to your shop. If they have not been to your organization recently, tell them a bit about any changes that have taken place and new expertise you have developed. You might also ask them why they have not been to your shop for maintenance recently. This surely should yield some work you would not have received without those calls and it lays the foundation for future work. It also yields a list of names that is either the beginning or an update of your customer list.

Getting the word out
If you are a small organization and you don’t have a direct mail program, you are missing one of the really powerful marketing tools in this business. What makes direct mail so strong is that we know exactly who our prospects are, the number is relatively small and the cost to send a direct mail piece is fairly low.
Advertising in magazines or newspapers can be very effective, but only if the percentage of readers that are prospects for your service is high. For example, if an ad in a magazine costs $2,000 and you have 10,000 prospects among the readers of that magazine, the cost to reach each prospect is only 20 cents. If on the other hand, you only have 500 prospects among the readers, the cost to reach each prospect is $4. By comparison, the cost for a direct mail piece is about $1.00 to $1.50 per person.

Building a list
The best way to build a list is to start with your current and past customers. Then, add to that the owners and operators of the kind of aircraft and/or equipment that you specialize in. The best place to get the names and addresses of these folks is by getting the membership directories of the relevant trade associations and owner associations. You’ll have to become a member to get the directories, but that is a small price to pay for a valuable resource. The next step is to determine which names to include and have them entered into a database program. It is important to add as much detail as possible, so that you can target each mailing. For example, information to include in addition to name of the organization, address, telephone number, fax number and e-mail address, is type and number of aircraft operated, base of operation and the name of a person, such as the owner, chief pilot or maintenance manager. Obviously, the name of the maintenance manager is best, if available, but often it is not. In that case, any name is better than no name, because no one likes to receive mail addressed to "Owner."

Data maintenance is important
Once the list is built, assign responsibility for maintaining it to someone. This means that each time a customer comes in for service, that fact is recorded. If someone calls up for information about your organization, their name is added, if they are not yet on the list. When direct mail pieces are returned by the post office with a forwarding address, make the change. When updated directories are published, compare the old with the new and make the changes. The reason this is so important is that people and organizations are constantly on the move. Individuals are promoted, telephone numbers get changed, email addresses change, etc. In fact, something like 25- to 30-percent of the information in a typical mailing list is outdated at the end of a year. This means that if the list is not kept up-to-date, it will be useless after a few years.
These efforts, coupled with quality service and customer appreciation, should help to keep a steady workload for your operation in up, as well as down, market trends.