Are we going into a recession? Is the economy down-turning? We just made it through the pandemic; what more are we going to have to make it through? These questions have been going through my head daily. We came off the pandemic really on a roll. Last year was our best year and, like any business, we want to maintain that, if not increase it, but will it be possible? In the first two quarters of the year we exceeded our sales from last year, but in the last two weeks of the second quarter, we saw a downturn in business. It wasn't a major downturn, but it was noticeable and it really made me start to consider my plan if we do go into a major recession.
I've only owned my shop for eight years and have never had to deal with a major recession in the economy and I really wasn't sure how I would deal with it. I felt blessed that the last few years have been very profitable, and I was able to financially set up the shop to weather a storm, but I really don't want to have to dip into our savings. I started doing research and talking to other shops that have been around a lot longer than I have and I came up with a plan.
The major takeaway I had from talking to other shops and other small business owners is that I should tighten my belt where I can but ramp up my marketing. I also talked to a handful of shops in my area that did not survive the pandemic. I wanted to gauge what happened and most of them said that they stopped paying for any type of marketing during the pandemic because they felt like it was a waste. People were just not driving, and the business wasn't there. That solidified my decision. If we are going into a recession, I want to be prepared for it and plan for it now, instead of just reacting once we are full-blown into it. We are ramping up our marketing for the next three quarters. I figured three quarters would give me enough time to really see if the economy is going into a recession or if the talking heads on TV are just wrong.
To rev up my marketing I decided to do a few things. We started spending about $600 a month with Yelp. We upgraded to have almost all the bells and whistles on Yelp and pay for some of the ads. We started this almost a month ago and I can tell you we are getting about four to five estimate requests a day from the service and convert between four and five small jobs a month and about two to three jobs a month that are over $3,000 each. Not a bad return on the investment. I chose to upgrade my Yelp services because Yelp and Apple Maps are now interconnected, meaning customers using an iPhone and searching for services see the companies listed in Yelp.
I also decided to do some event sponsorships, just to keep our name out there and help with public recognition. It's not targeting customers as specifically as Yelp, but I wanted to give it a try since it isn't something I've entertained in the past. We are sponsoring a summer concert series for our city that is free to the public. We are on the back of the tickets for the event and have a QR code on the back so that they can scan and upload pictures into our estimating software to receive a free estimate. We also get the benefit of our banners being at the event and having our name mentioned on all the radio spots for the event. I chose the summer concert series to try this type of marketing because the venue is in an area of the city that attracts a higher-end consumer and those are the consumers I want.
I was skeptical going into the sponsorship of the event thinking I wasn't going to get a good return rate on my investment, but I have been pleasantly surprised. I spent $4,500 on the event, and within the first two weeks we brought in enough sales to cover the cost threefold and the repairs are still rolling in since the event is weekly and runs through August.
The last thing we have implemented for revving up our marketing is geofencing. I have done geofencing in the past and brought it back with a more targeted plan. I'm on the outskirts of the downtown area and financial district for my town so I started geofencing an area that encompasses the courthouse and all the buildings that typically the banks, financial advisors and attorneys are in. I also started geofencing the wealthier neighborhoods that are within a certain radius of the shop. I am purposefully trying to target the higher-end customer because I know if we go into a recession these customers will be the ones that continue to get their vehicles fixed, and a recession will not affect them as hard as the middle to lower income customers. I'm trying to market my business with a very specific and conscious plan.
I don't know if we are truly going into a recession, but I don't plan on sitting idle waiting to find out. I would rather spend an extra $2,500 a month to ensure that we are not negatively affected by a possible recession. My father told me a great analogy. Your business is like a plane, you get it off the ground and flying and that takes a lot of fuel, energy and ingenuity. Once you are up in the air, you aren't going to just turn off the engines and hope you glide to your destination, so why would you hit the brakes and turn off your marketing or ease off it once your business is off the ground? You wouldn't, because just like a plane, that would be catastrophic.
