Some people call me an OG of wedding business marketing, but deep down I'm just another person wearing PJ bottoms on Zoom. I swear a lot, I share my struggles, and I don't pretend to be better than anyone else.
There is a lot of talk about an impending recession in 2023. No one can predict the future but I have some hot takes about whether you should be concerned about a recession, what the current reality is despite what news reports might say, and of course some specific actions you can take to prepare your business for a recession.
Recessions happen about every 10 years in capitalist economies. It’s an unfortunate inevitability of how our economic system works. It’s not great, but it’s the system we have. But that doesn’t mean you should live in fear and it doesn’t even mean that your business will take a hit.
In this episode, I share my thoughts about the worry and concern about a potential recession, what you should definitely not do if you’re worried about a recession, and 6 steps you can take to prepare your business for an economic downturn.
The definition of a recession is debatable among economists. A recession is a significant, widespread, and prolonged downturn in economic activity. A common rule of thumb is that two consecutive quarters of negative gross domestic product (GDP) growth mean recession. Usually, inflation is high as is the unemployment rate but again, there’s no one definition.
We are currently not in a recession if you go by the 2 consecutive quarters and the unemployment rate. There’s debate around if it’s actually going to happen.
Recessions are unfortunately normal in capitalism so one will happen sooner or later. Recessions are the inevitable result of the business cycle in a capitalist economy and they happen about every decade. It’s definitely not a great system but it’s the one we’re stuck with for now.
We live on this roller coaster so we shouldn’t be shocked by it. We’re really only shocked when the media fans the flames and never shuts up about it and that’s what’s happening now.
If you only get your news from nightly news or 24-hour news networks, you may think a recession is coming any day now and it’s bound to hit the wedding industry hard. That’s a narrow view that ignores some really important data.
We are a luxury industry BUT the new richest person in the world is the CEO of LVMH. LVMH is a conglomerate of more than 70 luxury consumer goods companies including Tiffany & Co., Christian Dior, Sephora, Louis Vuitton, Hennessey, and Fenty. The CEO of LVMH is the new richest person because global luxury goods sales were up a whopping 22% to 353 billion euros in 2022 compared to 2021
Yes, 2022 has been bad for inflation. Yes, eggs are stupidly expensive right now. And YET Black Friday sales still set records topping $9 BILLION in sales.
You still spent money during the pandemic and the financial crisis in 2008 and those are extremes. You’re in a luxury industry and many of your clients are recession-proof. Most recessions don’t hit as hard as the pandemic and many of them don’t impact consumers all that much.
Whatever you do, do not under any circumstances cut off your lead sources because of an ” impending recession”. If you’re paying for advertising or marketing that is bringing you clients, that is not the place to cut back. Doing so will only result in fewer leads, fewer bookings, and lower revenue.
I understand that the panic in the messaging around a potential recession has serious head-for-the-hills vibes but don’t cut off your nose to spite your face here.
Now that we’ve covered what not to do, there are 6 specific things you can do to prepare for and handle a recession. Remember, recessions are inevitable in our current economic system so there will be one sooner or later and that’s okay. These things will keep your business healthy and growing.
1. Offer more payment plans
Maroo was the first to offer Book Now, Pay Later for weddings and it’s really something everyone should be using for payment plans. 74% of couples turn to high-interest credit cards to help pay for their weddings and that can cause them to hold off if they feel uncomfortable about a coming recession. Maroo provides an option for couples to pay for their wedding for up to 12 months at 0% APR.
Meanwhile, you get the full, upfront payment the moment the couple books BNPL for their wedding so you don’t have to wait for or chase the payments. Maroo also makes your clients feel more secure by offering wedding cancellation insurance. This pre-empts the concerns and worries your clients may have and make them feel more comfortable with pulling the trigger and booking you.
You can sign up for your free Maroo account and start offering Book Now, Pay Later here
2. Create smaller offers
In a variety of industries, there has been a growing trend toward smaller offers. Could you take a small part of what you offer, turn it into a mini product or service, and sell that? I talked to Kay Northrup about offering 2 hour Power Planning sessions and they have been extremely popular in her business. They’re also a great way for clients to test drive her as a planner and book her full planning service later.
3. Beef up your savings
It’s never a bad idea to build up your savings and it can ease your worries in uncertain times. Start with saving one month’s business expenses including your pay and one month’s personal expenses in separate accounts of course and work on building up to 3 months.
4. Adapt like people did during the pandemic
I’ve never seen as much creativity and innovation in revenue streams as I saw during the pandemic. In this podcast episode, I shared how some wedding professionals have already diversified their wedding business revenue streams to help them survive and even thrive during challenging times.
It’s wise to diversify your revenue streams and it builds confidence. When you realize that no matter what the world throws at you, be it recession, pandemic, or anything else, you can adapt and find a way to earn money, you’ll have a whole new level of confidence about your ability to figure things out.
5. Make your value SUPER clear
Your ability to raise your prices or sell hinges on whether or not your potential clients see the value in what you offer. This is something we talk about all the time inside The Wedding Business Collective and we have lots of courses and resources inside that can help you with that. One of them is a killer masterclass called Service Pages That Sell with copywriter extraordinaire Ashlyn Carter.
Price is a factor for your clients, but it’s not the determining factor. What people REALLY care about is value, and it’s your job to communicate the value of what you have to offer. You have to connect the dots between what you offer and what they care about. That’s what makes what you offer irresistible to your ideal clients and as a result of seeing it that way, they’re willing to pay more for it.
6. Streamline your business
Streamlining your business allows you to work more efficiently and make more money per hour. If it takes you 50 hours to deliver on your service for your client and you can shave that down to 4o hours, you’ve just given yourself a 20% raise. The client gets the same result and has the same great experience and it takes you 20% less time to deliver it.
There are many different ways to streamline your business including systemization, automation, delegation, or deletion. We’ll be talking about all of those during Wedding Business CEO Summit and you can get your free ticket at www.weddingbusinessceosummit.com! It’s happening January 23rd-27th and it’s designed to help you go from overwhelmed & overworked to streamlined & more profitable than ever.
My last piece of advice for you: Stop reading/watching the news. It’s designed to elicit anxiety and keep you watching. Panic is not helpful in any situation so don’t let media coverage lead you into a panic. If you want to get economic news, change your sources to something more specific and nuanced like The Economist or Planet Money.
I feel calm and you should too. Things always ebb and flow and quite frankly, if you can handle the last few years in the wedding industry, you can handle anything.
Get your free ticket to Wedding Business CEO Summit
The Wedding Business Collective
Episode 228: Behind The Wedding Business with Kay Northrup of Kay Northrup Events
Episode 167: Diversifying Your Wedding Business Revenue Streams
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