Regardless of all of the manuvering done by the Federal Reserve and Congress, the economy is still heading south. While a $700 billion dollar rescue plan isn't anything to sneeze at, it hasn't really changed the way the average consumer feels about the economy. Everyone is a little afraid, and I think, generally, we are all spending less. I know that in my household we are. 

Retail spending is roughly 2/3 of the United States' economic activity. And, while a 1.2% drop in sales may not seem drastic, given the maginitude of the number of dollars that entails, it means that everyone who sells a product hurts a little bit. And in some cases, like auto dealers, it hurts a lot. So, in a declining economy, where fewer people are acting out their consumerist impulses, what is a smart online merchant to do? Here are 5 strategies to combat a sales decline:

1.  Maximize Your Exposure: In tough times, it is harder to continue to keep your brand and your products in the limelight. Advertising starts to look like an expense rather than an investment. So, start looking into ways to drive your brand into the spotlight without spending much money. People will still be using the internet, regardless of the economic conditions, so drive your brand into the public consciousness through search engine optimization. Yes, I know that this tip is a little self-serving, but it is completely crucial. In order to get customers to come to your site and engage with your products and brands, you need to be found. Search engine optimization is the most cost-effective strategy to grow your web exposure. And there are no incremental costs associated with natural search traffic. Search Engine Optimization can grow your sales and help you gain marketshare regardless of the economic climate.
2. Manage Your Return on Investment: We love paid search. We think it is the fastest way to drive traffic to your site, and can accelerate your learnings about your business. In fact, we advise all of our clients to use their paid search campaigns to inform the strategies we use on their organic search campaigns. But, paid search is full of incremental costs. Every click costs you cash. And, if you aren't careful, those costs can get out of hand. Manage your paid search costs. Be manaical about analytics and insure that you know how that click that you've paid for impacts your bottom line. We find that many companies focus on the traffic that paid search brings in, but not the results. Make sure that you are measuring and analyzing the cost, benefit and impact of every paid search click. This, my friends, is CRITICAL.
3. Manage Your Margins: There are few things that are more disheartening to experience than to make a sale and realize that you didn't cover your costs. This happens a lot in retail. You end up paying out more in marketing and shipping costs than the margin you've built in to the product. That is taking the short road to the poor house. It happens a lot when you are addicted to paid search and not managing your paid search ROI, and are neglecting your search engine optimization. When you are maximizing your exposure through search engine optimization, and are really focusing hard on mananging your paid search ROI, you may find that you can afford to squeeze your margins a bit. I am not suggesting that you lose money, but if you follow strategies #1 and #2, managing your margins to make your product more attractive to cutomers who feel less affluent than they did two years ago can keep driving your business ahead, even in the roughest of times.
4. Be A Good Citizen: Things are rough out there. They really are. Try doing something nice for your industry or the community. If you have old inventory, perhaps you can donate it somewhere and get a tax break. Or perhaps you can donate a portion of your proceeds to families in need. You are all creative. You can all discover something great to do. How does this help you out in a declining sales environment? Well, it enhances your image. It makes people aware that you aren't just a business, but rather a community partner and are concerned about everyone's well being. Does this help your bottom line today? Probably not, but it will cement your spot as a corporate friend and make potential consumers feel better about doing business with you. That can definitely push the buy/not buy decision in your favor. And, by the way, it just makes the world a better place. That never hurts. And, if you are lucky, some intrepid reported will write a great story about you and you'll get tons of free press. That doesn't hurt either.
5. Slow Down: Everyone (especially me) is impatient. Nothing ever happens as fast as I want it to. Changes don't happen fast enough, products never ship fast enough, nothing ever happens fast enough. Well, when times get tough, slow down. Haste makes waste, as my mother always said. When times are tough, it is a perfect time to slow down and examine how to make each action count. Analyze your operation so that you can be the most efficient organization you can. Do you need to ship 2-day when 3-day is almost as good and costs 50% less? Do you need to hire another employee when expanding everyone's responsibility a little bit will cover things? Do you need to advertise where you always have? These are the kinds of questions that you have time to answer if you slow down. This is hard, but in tough times, slow down, analyze, and then engage. Haste makes waste, and can accelerate a sales decline. Slow down, examine your workflow and cost structure and make decisions that make you more efficient.