Golf is my favorite game. You learn a lot about yourself and your friends on the course. There are a few life-lessons to be had as well. One of my favorites is, “You have to play the ball where it lies.”

Right now our economy is in the rough. That’s the bad news. The good news is there’s more golf to play and you have a business to run.

The recession has no doubt taught you a lot about your core competencies, operational inefficiencies, customer relationships and people. You probably have more control over your budgets, cash flow, pricing and product portfolio as well. Those are all positives. What now?

Recessions end and, while we’re not out of the woods yet, there are several indicators pointing to a brighter future. However minor, most businesses are shifting from cost cutting to planning and investment decisions. How are you approaching your marketing investments? How aggressive should your next shot be?

Looking back may help us look forward. Every company adjusts expenses to revenues but successful companies never stop investing in critical competencies, be they product development, infrastructure or general marketing, most of which is digital now.

The recession of 2001, which was brought on by 9/11, was studied by Bain & Company. They evaluated 2500+ companies and concluded:

About 24 percent more firms moved from the back of the pack to the front in the 2001 recession compared with the subsequent period of economic calm (in terms of) net profit margins and sales growth.

Southwest Airlines is a good example. With a strong balance sheet and some cost advantages, Southwest grew sales and market share, while the other airlines, their larger competitors, cut personnel and capacity, Southwest grew and took share by increasing their marketing investments, lowering fares and retaining all their employees, a move that kept their labor force motivated and and loyal for years.

The results were astounding. Southwest increased its fleet 51 percent in the following six years and is still the only airline to be profitable since its inception. Wal-Mart offers another example of investing during a recession. They used the 2001 recession to launch their “Everyday Day Low Prices” slogan. It proved was such as success that they’re doing something similar today, you could say it's their recession-based marketing strategy. 

This time Wal-Mart is using the current downturn, as well as the demise of Circuit City, to enter consumer electronics and, potentially, challenge Best Buy. In addition, they are remodeling their stores to make them more open and consumer-friendly, more like Target’s. These are big investments. Does Wal-Mart know something most companies don’t? Does their success allow them to do what others can’t? Or are they successful because they had the knowledge and courage to act on their goals and aspirations while their competitors responded to their fears?

On Wednesday's post, The Shot, we’ll discuss tactics.

Steve