Recession Planning in a post pandemic adapted economy
This once-in-a-century pandemic is placing businesses and individuals in never chartered territory, however there are previous events that resemble it in different forms what we are living through now. We can start our recession planning now for what almost certainly lies ahead.
This article is being posted with businesses in mind and will talk about past pandemic or black-swan events and what a recession planning a business can do to not just survive but thrive when the pandemic ends and the recession begins.
Right now, businesses are dealing with a totally unexpected and sudden stop in their cash flows. Those that are planning on surviving either through their savings, government assistance or by quickly adapting their business models need to know what to do in the future. While it was impossible to predict how long or how worse the current situation can get, we can use history as a guide to help us figure out the future. When people face risks, they want facts that can help them make better decisions.
Past Pandemic and Economic Events to consider for Recession Planning
Pandemics are not a new problem. Pandemics have been well documented going back to the Plague of Athens (430 BCE), widely believed to have contributed to the fall of the of Greece and the rise of the Roman empire. The Plague of Galen (165-180 CE) devastated the Roman Empire. Perhaps one of the most famous pandemics, the bubonic plague started around 540 CE and returned again in the 1300s and continued in numerous cycles until the 18th century. Cholera, with a pandemic between 1816-1826, is now in its eighth cycle that began in 1992. In the Spanish Flu pandemic of 1918-20, upwards of 100 million people are thought to have died, representing as much as 5% of the world’s population. Half a billion people were infected.
The U.S. and Global economy have been subjected to some enormous financial shocks before—the Great Crash of 1929, the stock market crash of 1987, 9/11, and the housing/banking crisis of 2008 but has there ever been a sudden stop to retail businesses comparable to this? Not on this scale that I am aware of-hence we are in unchartered territory in that aspect but looking at modern history what did businesses do to come out on top after these events?
Thinking as a business owner, looking at these past events (akin to comparable sales) may provide insight into the potential economic impact of the Coronavirus or Covid-19 assuming it evolves and passes in a similar fashion. Just like comparable sales where no two properties are exactly alike, the same is true regarding the outcomes of these type of events. Three past events are examined including one pandemic, one market crash and one financial crisis. All three had recessions occur after the event.
Spanish Flu- 1918
1987 Stock Market Crash
2008 Housing/Banking Crisis
Probably the closes thing to what we are experiencing now was the Spanish flu in 1918-20, not just because of the global health and death toll but because of actions local businesses at the time underwent by having to close down by implementing their own version of social distancing. During the Spanish Flu of 1918-20 more than half a million Americans died and certain cities closed restaurants and other public gathering places in an attempt to halt the spread of the virus. The pandemic had a big negative impact on retail sales, but, according to the available statistics, the over-all economy didn’t fall into a recession. My personal belief that unless this passes quickly that won’t be the case this time, so later in the article I will talk about operating and marketing your business in a recession. There was an eventual economic slump in 1920-21, but that has been attributed more to the Federal Reserve raising interest rates to head off inflation than because of the pandemic.
Elizabeth Brainerd and Mark V. Siegler’s 2002 paper for the Centre for Economic Policy Research, “The Economic Effects of the 1918 Influenza Epidemic“ comes the closest of all the papers I’ve read to looking on the bright side of things: They found “a large and robust positive effect of the influenza epidemic on per capita income growth across states during the 1920s.” That doesn’t mean the Spanish flu was actually good for the economy. That growth, or at least some of it, they stated “likely represents a return to trend rather than a change in trend.” As we know the U.S. and global economies had been in a long- term upwards trend before the Coronavirus spread.
So, economists that have studied it think that most of 1918 Spanish Flu pandemic’s effects “were short-term,” Many businesses, especially those in the service and entertainment industries, suffered double-digit losses in revenue. Other businesses that specialized in health care products experienced an increase in revenues. Does that sound familiar to what is going on now?
1987 Stock Market Crash
On Oct. 19, 1987, a day I remember well since I was working as a stockbroker at the time became known as “Black Monday,” the stock market crashed as the Dow Jones Industrial Average plunged 508 points, or 22.6 percent in value, its largest single-day percentage drop at that time. The crash came after a two-week period in which the Dow dropped 15 percent. Again, sound familiar to todays current events?
According to the Oct. 20 New York Times, “Business leaders were shaken by the collapse, which wiped out huge amounts of the market value of their companies. And they seemed to have been caught by surprise. But many leaders were confident the panic would pass.” That statement sounds a lot like what Donald Trump has been saying.
Despite fears of a recession or a global depression at the time, the stock market quickly rebounded. The Dow Jones Industrial Average made record gains on Tuesday and again on Thursday after the crash. By the end of the year, the Dow was higher than it had been at the start of the year, and returned to its pre-Black Monday level just two years after the crash. Why I bring this up is that after the crash we returned to the upwards trendline just as in 1919, however it took the economy 2 full years to recover.
2008 Housing/Banking Crisis
On Oct. 9, 2007, the Dow hit its pre-recession high and closed at 14,164.53. By March 5, 2009, it had dropped more than 50% to 6,594.44. Although it wasn’t the greatest percentage decline in history it was pretty horrific. Thousands of people abandoned their homes because of the loss in real estate value and banks received major government bailouts—again the bailouts relate to what is going on now with the stimulus packages. It took the market until 2013 to fully recover, however once again-after the crash the trendline resumed.
These 3 events show us that time after time we have recovered. No matter how dark or desperate times have been. If you plan on being open for business next year or beyond, I believe you should plan on operating your business while in a recession mode for a few years.
What can you do now? What information do people need from you?
Certainly, you must let your employees know about corporate policies regarding health insurance, telecommuting, absenteeism, and hygiene practices (hand washing, use of masks, use of gloves, and so on). Suppliers and customers will want to know whether and how the company will stay open for business. Adding a Website Cookie Notice will help keep your customers informed about what you are doing-are you open for business-are you providing deliveries-are you providing take out, etc. etc.
Instructions on adding such a cookie notice to your website are here: https://digitalpapercuts.com/cookie-notice/
Small Business Owners should refer to the SBA Coronavirus (COVID-19): Small Business Guidance & Loan Resources Guide
Do you have the resources needed to communicate your message?
Skillful communication requires several capabilities. Many companies already have employees with the necessary skills: people who can learn the essential facts about the risks; people who can communicate with employees, customers, and others, learning about their beliefs and concerns; people who can create solid communications and, critically, test them to make sure they are understood as intended; and people who can disseminate messages once they’re ready. If you do not have such a person in your organization it is imperative you find one.
Your job as a business owner or manager is to coordinate your team, ensuring that its members know their assigned roles. Effective communication calls for management more than charisma. Managers who follow this disciplined approach can make their company an authoritative source of trusted information.
Social Distancing effect on businesses
Social distancing is here to stay for much more than a few weeks. It will upend our lives, in some ways forever. To stop the coronavirus we will need to radically change almost everything we do: how we work, where we work from, exercise, socialize, shop, manage our health, educate our kids, or attend sporting events.
Living in a state of pandemic
In the short term, this will be hugely damaging to businesses that rely on people coming together in large numbers: restaurants, cafes, bars, clubs, gyms, hotels, theaters, shopping malls, concerts, sporting venues (and sports teams), conference venues, cruise lines, airlines, public transportation, schools, day-care centers and on and on.
As a business you need to adapt to the current conditions, especially if government is putting on restrictions on what you can and cannot do. What do I mean by adapt? We have already seen restaurants offering take out service, in some places bars and breweries are now able to sell liquor and beer to go. But what if this lasts for an extended period of time. What are some things that businesses can do? Well, let’s take gyms as an example. As a gym owner you probably have access to be able to purchase gym equipment wholesale, so why not become an equipment retailer? For restaurants-in addition to take out perhaps add in ready made meal prep-or add in toilet paper sales with food orders assuming your restaurant supplier can supply you with it. As a restaurant, bar, movie theater or any public place consider redesigning your physical layout, removing tables or seats in order to create more space for customers. For retail stores consider adding plexiglass between your cashiers and your customers. These are just a few ideas to get you thinking.
Is your marketing strategy ready for the next recession?
All the warning signs of an economic downturn are flashing red. Recessions have a nasty habit of destroying unprepared or ill-equipped businesses and I can’t imagine anyone was prepared for this. In the last recession in 2008, more than 400,000 small businesses went bankrupt or permanently closed. If you want to prevent your business from suffering the same fate, you need to craft a recession marketing strategy now to get you through the next few years. If you choose not to heed this advice… well—it was nice knowing you.
In every recession companies find themselves in poorly charted waters because no two downturns are the same. However, in studying the successes and failures of companies as they have navigated previous economic downturns patterns in consumers’ behavior and firms’ strategies that either propel or undermine performance have been identified.
During recessions, of course, people set stricter priorities on their purchasing and reduce their spending. As sales start to drop, businesses typically cut costs, reduce prices, and postpone new investments. Marketing expenditures in areas from communications to research are often slashed across the board—but such indiscriminate cost cutting is a mistake.
Although it’s wise to contain costs, failing to support your brand or examine core customers’ changing needs can jeopardize performance over the long term. Companies that put customer needs under the microscope, take a scalpel rather than a cleaver to the marketing budget, and nimbly adjust strategies, tactics, and product offerings in response to shifting demand are more likely than others to flourish both during and after a recession.
This may or may not be the first time you’ve had to keep a business afloat during an economic downturn. So, to help you out, I’ve listed the most successful recession marketing strategies and distilled them into five main rules for you to follow:
- Don’t cut your marketing budget
- Analyze and track everything—now. Know your numbers.
- Focus on existing customers. A good Digital Marketing Company can help you get new customers but you need to retain what you have already.
- Do a deep dive of your target audience’s past recession buying behavior
- Increase conversion rates by testing, tweaking, testing and repeating
Recession Planning Marketing Rule #1: Don’t cut your marketing budget.
It’s well documented that slashing the marketing budget in a downturn will only help with profits in the very short term. As examples-in 1987 Charles Schwab was hit hard. There were worries that the company would not survive. However, they increased their ad and technology budget and grew their business even during the recession and in the 90’s became one of the top performing stocks for the majority of the decade. Other brokerages did not and folded or were left in the dust playing catch up. You may not remember names like Kennedy Cabot or Quick and Reilly. Even if your business survives by cutting marketing costs your competitors that are marketing will be the ones that emerge on top. This applies to both SEO and PPC advertising. Building a brand that consumers recognize and trust is one of the best ways to reduce risk when the economy takes a turn for the worst.
Cutting your budget for marketing during a recession is purely a knee jerk reaction many inexperienced business owners (and even experienced ones as well) might make. If your competitors are cutting their budgets, you’ll see an even greater long-term return on your marketing investments by moving ahead of them in organic search rankings by improving your search engine optimization.
Don’t be rash in your decisions but objectively look at where you’re spending money and what your ROI is. The key word here is objectively. If you need cash flow now, PPC advertising is probably the best place to invest your money. If you are looking at growing your business over the next few years investing in Search Engine Optimization can really pay off. Both methods benefit from your competitors pulling back on their marketing efforts. With less competition your PPC bids will drop and with fewer people doing SEO you can also move ahead, especially if you are doing Local SEO.
A report just released by Search Engine Land on March 22, 2020 just announced that ad spending doubled since social distancing measures have been implemented.
Recession Planning Marketing Rule #2: Analyze and Track Everything-now…know your numbers.
When you think about the core of what we do, Digital marketing allows for more precise, specific, and measurable campaigns. This leads to better, more quantifiable results than traditional advertising campaigns—and it all starts with the right tracking and analytics. To track your results accurately, you need Google Analytics and someone to help you combine that data with your sales data. That way, you can identify the best-performing marketing strategies and ones that you can cut without seeing any real dip in branding or sales. If you have data from 2008-2012 an analysis of that data can help you get ahead of the curve.
During a recession, knowing exactly what return each marketing investment is providing and why will be your key to not just survival, but growth. Digital marketing has long been accepted as the best low-cost, high-return marketing strategy largely due to measure-ability and targeting and retargeting capabilities.
Begin by performing triage on your brands and products or services. Determine which have poor survival prospects, which may suffer declining sales but can be stabilized, and which are likely to flourish during the recession and afterward.
Recession Planning Marketing Rule #3: Focus on Existing Customers
Regardless of your industry, your brand’s biggest asset during a recession will be your existing customer base, make sure your marketing strategies are focused on your most valuable, loyal customers. Bend over backward to keep them happy, and be sure to reward their loyalty. These happy customers will repay you in the form of revenue, recommendations and reviews.
During a recession it’s more important than ever to remember that loyal customers are the primary source of cash flow and can be used for organic growth. Marketing isn’t optional—it’s a “good cost,” essential to bringing in revenues from these key customers and others.
Recession Planning Marketing Rule #4: Do a Deep-Dive of Your Target Audience’s Recession Behavior
The success of your recession planning marketing strategy will hinge on this. People change as the world around them changes. We probably all have changed our buying habits already. What your target audience needs in one economic condition may not be true in a different one.
Think of your customers as falling into four groups:
The Stop Everything segment feels most vulnerable and hardest hit financially. This group of consumers reduce all types of spending by eliminating, postponing, decreasing, or substituting purchases. Although lower-income consumers typically fall into this segment, in this market environment with a sudden increase in people being laid off as well as many anxious higher-income consumers in a time of uncertainty can fall into this group.
The Cautious group of consumers tend to be optimistic about the long term but less confident about the prospects for recovery in the near term or their ability to maintain their standard of living and are prudent in their spending. Like the ‘Stop Everything’ consumers, they cut back on spending in all areas, though less aggressively and may still spend some money. They constitute the largest segment and include the great majority of households unscathed by layoffs or business closures, representing a wide range of income levels.
Comfortably well-off consumers feel secure about their jobs, income and savings and their ability to ride out current and future bumps in the economy. They’ll consume at near pre-recession levels, though now they’ll tend to be a little more selective about their purchases. The segment consists primarily of people in the top income brackets or dual income households. It also includes those who may be less wealthy but feel confident about the stability of their finances.
The Carpe Diem segment carries on as usual and for the most part remains unconcerned about savings. The consumers in this group will respond to the recession mainly by extending their timetables for making major purchases.
Regardless of which group consumers belong to, they prioritize consumption by sorting products and services into four categories:
- Essentials which are necessary for survival or perceived as central to well-being i.e toilet paper.
- Treats are indulgences whose immediate purchase is considered justifiable but not essential.
- Postponeables are needed or desired items whose purchase can be reasonably put off. i.e. a new smartphone.
- Expendables are perceived as unnecessary or unjustifiable. i.e. a new car.
Throughout a downturn, all consumers except those in the Carpe Diem segment typically reevaluate their consumption priorities. Knowing their buying behavior and how they feel about your product or service-(is it essential-a treat-postponable-or an expendable?) can help you in your marketing message to them.
We know from previous recessions that such products and services as restaurant dining, travel, arts and entertainment, new clothing, automobiles, appliances, and consumer electronics can quickly shift in consumers’ minds from essentials to treats, postponables, or even expendables, depending on how fast the individuals financial situation changes.
As priorities change, consumers may altogether eliminate purchases in certain categories, such as household services (maid service, yard care, pool cleaning), moving them from essentials, say, into expendables. Or they may substitute purchases in one category for purchases in another, perhaps swapping dining out (a treat) for cooking at home (an essential). And because most consumers become more price sensitive and less brand loyal during recessions, they can be expected to seek out favorite products and brands at reduced prices or settle for less-preferred alternatives. For example, they may choose generic labels or switch from organic to nonorganic foods.
Recession Planning Consumer Segments Changing Behavior
Risk of Sales Downturn
|Stop Everything||Will seek lower cost products and services||Will reduce or eliminate treats or seek lower cost options||Except in case of an emergency will put off all unnecessary spending such as dental cleaning or car maintenance||Will totally stop all expendable purchases|
|Cautious||Will still seek out the favorite brand names but will look for better pricing, such as buying in bulk at Costco or other warehouse stores||Will cut back somewhat on quantity or frequency and seek out value.||Will try to repair instead of replace. Will look for value and lower cost options such as vacationing in state versus out of state or country.||Will deeply cut back expendable spending until inching towards migrating to the comfortably well off group.|
|Comfortably Well Off||Will continue to buy pre-recession favorite brands or services.||Will be more selective but will continue to purchase ‘luxury’ items if they are sold on the benefits.||Will seek better quality for the price. i.e. craft beer vs. mass produced macro beer. Top shelf vs. well drinks.||May reduce only the most high end items but for the most part will purchase as normal.|
|Carpe Diem||Will continue to buy pre-recession brands or services||Will continue to buy at pre-recession levels.||Will buy if they find a good deal.||Reluctant to change pre-recession behavior but may cut back slightly on new purchases|
Recession Planning Marketing Pro Tip: The trick to successful advertising during a recession lies in consumer psychology and emotion. A recession is a trying time for everyone, and there’s an undercurrent of fear, worry, and stress beneath the surface. By tapping into and appealing to the emotional side of consumers you have a better chance of connecting with and persuading them.
Research shows that marketing campaigns that focus on emotional engagement tend to be more profitable than marketing campaigns that focus on rational messages (such as low prices or special offers), even when times are tough. Remember that people buy product and service benefits.
Recession Planning Marketing Rule #5: Boost Conversion Rates by Testing, Tweaking, and Repeating
You can’t MAKE people alter their spending habits. We have a mantra here at Digital Papercuts: Track > Test > Tweak > Track > Test > Tweak > Repeat. Everything you do online can—and should—be tracked. You can’t win the game if you don’t know the score. Tracking and capturing more accurate information about the performance of each of your marketing strategies allows you to see opportunities and problem areas your competitors cannot.
Once you’ve gathered enough data, test different tweaks to your strategies. You can’t get better results if you don’t test new strategies and evaluate old ones. Bring flexible and not relying on assumptions is key. Run tests to find the most cost-effective strategies you can dial up and leverage. Once you’ve got your results, repeat the process over and over again.
Sometimes you’ll find you need to drop everything and pivot—and that’s okay. The business owners and marketing managers that thrive in recessions are the ones who are adaptive and able to pivot easily.
Your strategic opportunities during a economic downturn will strongly depend on which of the four segments your core customers belong to and how they categorize your products or services. For example, prospects are reasonably good for value-brand essentials sold to stop everything consumers, who will forgo premium brands in favor of lower prices. Value brands have opportunities with postponable products, as well. Repair services can market to the cautious group, who will try to prolong the life of a computer rather than buy a new one as an example.
Where opportunities are stable or uncertain (but leaning toward stable) such as general dentistry, firms should push their advantage. In past downturns, companies that were able to increase share of brand awareness by maintaining or increasing their marketing spending captured market share from weaker rivals. What’s more, they did it at lower cost than when times were good.
In deciding which marketing tactics to employ, it’s critical to track how customers are reassessing priorities, reallocating budgets, switching among brands and product categories, and redefining value. It’s therefore essential to continue investing in market research and analyzing your data.
It’s critical to track how customers reassess priorities, reallocate funds, switch brands, and redefine value.
In recessions, businesses have to stay flexible and nimble, adjusting their strategies and tactics on the assumption of a long business slump that could last years and yet be able to respond quickly to the upturn when it comes. Companies that wait until the economy is in full recovery to ramp up will be at the mercy of better-prepared competitors. As an example, when we opened Papago Brewing in 2001 a portion of it was set aside to sell homebrewing supplies. During that time in our early years where we were coming out of a recession, we analyzed our sales and sold off the homebrewing business and added more tables and seats and a kitchen to capture higher revenue per square foot sales. Another thing you can do besides changing your business model is to add new products. One thing we did at Papago Brewing was that we continually developed new beer styles for the Carpe Diem customers, with their undiminished appetite for new goods and experiences. Because of this we came out with a new flagship product that eventually led to a lucrative sale of the business.
Marketing Throughout a Recession
During downturns, businesses must balance efforts to lower costs and beef up short-term sales against investments in long-term brand health. Streamlining product portfolios, improving affordability, and bolstering trust are three effective ways of meeting these goals.
Internet marketing, specifically PPC advertising in particular is laser targeted and can be relatively cheap and its performance is easily measured. In the 2008 recession, businesses spent 14% more on online ads over the first three quarters of 2008 than they did over the same time frame in the previous year.
Tailoring your Marketing Tactics
|Stop Everything||Promote lower price products and services. Introduce a lower priced brand. i.e.||Advertise as a you deserve it.||Promote exceptional deals. Promote the feeling that sometimes cheap gets to be expensive.||Offer do it yourself alternatives. Continue brand awareness.|
|Cautious||Emphasis quality. Promote bonus offers-i.e.buy 1 get 1 free.||Advertise affordable products or services in comparison to more expensive options. Offer loyalty rewards.||Promote repair services. Promote products or services that offer lower cost benefits to consumers.||Continue brand awareness.|
|Comfortably Well Off||Continue brand awareness.||Emphasize quality over lower priced options. Market to a persons vanity-desirability of the product.||Advertise scarcity-buy now or miss out. Talk about savings provided.||Advertise benefits of being unique/special.|
|Carpe Diem||Continue brand awareness. Promote items that people can’t live without.||Appeal to impulse buyers.||Promote quality of life benefits by purchasing now.||Offer new products or services as must have items. On the upper end advertise high end products or services that people will want as the economy improves.|
Recession Planning Steps you can take to run your business in a recession.
In a recession ‘stop everything and cautious’ customers or prospects in particular will be doing a lot of window shopping for the best deals. All businesses will compete on offering the lowest price. Many businesses will need to increase the frequency and depth of temporary price promotions. At the same time, they must carefully monitor consumers’ perceptions of “normal” price levels in order to be able to raise prices later. Try to avoid getting in price wars with competitors by talking about how your products or services are of better quality.
While premium-brand market leaders shouldn’t move their brands down-market, they can introduce a “fighter brand,” a lower-priced version of the premium offering sold under a different name and backed by minimal advertising. Many companies have done this, Coors did this by introducing Keystone Light, United Airlines with Ted, General Motors with Saturn, Procter & Gamble developed Banner as a cheaper alternative to Charmin. One element in building a fighter brand is to avoid creating a low-price product that is so attractive that it steals customers who would otherwise be buying your company’s premium-brand product. On the other hand, if the fighter brand is too expensive or too low quality, it won’t be very attractive to the consumers it is designed to attract. When the recession ends, the fighter brand can either be withdrawn or continue as a value entry in the overall product line.
Restaurants and other businesses often configure offerings by using key retail price points proven to resonate with customers, as with the dollar Whopper. Coke sets prices suited to different consumer segments—for example, selling the 24-pack size at $5.99 for ‘cautious’ consumers who can afford to stock up as well as the two-liter bottle at 79 cents for ‘stop everything’ consumers with thin wallets.
In addition to offering temporary price promotions or list-price changes, companies can improve affordability by reducing the thresholds for quantity discounts, extending credit to their customers, or having layaway plans. Reducing item or serving sizes, and then pricing them accordingly, is another effective tactic. For service businesses such as cable and mobile telephone companies, lowering consumers’ up-front adoption costs and reducing penalty charges can help attract cost-conscious and cash-poor consumers. At Digital Papercuts we have done this ourselves by lowering our set up costs for our PPC management services, Depending on whether customers are seeking the lowest absolute price or the most bang for their buck, service businesses can, respectively, unbundle offerings or fold more services into the bundle—or offer both options.
Worried consumers—even in the ‘cautious’ and ‘comfortably well-off’ and ‘carpe diem’ segments—see familiar, trusted brands as a safe and comforting choice in trying times. Reassuring messages that reinforce an emotional connection with the brand and demonstrate empathy (for example, by conveying a sense that “we’re going to get through this together”) are vital and can really resonate in these unnerving times. Post 9/11 a number of companies and brands used this strategy including the NFL, Morgan Stanley, Charles Schwab, American Airlines, Starbucks and many more. This type of message now more than ever before probably means more on a global scale that at any other time and can help us all get through this…together.
Reassuring messages that reinforce an emotional connection with the brand and demonstrate empathy are vital.
Empathetic messages must be backed up by actions demonstrating that the company is on the consumers side. Loyalty programs should reward not just big-time spenders but also people who purchase small amounts frequently. Just as coffee and sandwich shops have buy 10 get 1 free cards, where legal bars could have mug clubs and even dentists can offer get a buy 3 teeth cleanings get 1 free offers. Retailers can educate consumers on how to shop smart and save money. For instance, some supermarkets during previous recessions prepared flyers detailing nutritious, low-cost meals. And companies can engage customers in brand activities that convey caring. Amazon with their AmazonSmile program for example allows a portion of your purchase to go to the charity of your choice if that charity has registered on Amazon.
While it is important to build emotional connections, don’t neglect to reinforce trust by reminding customers that buying the brand is a sound decision.”
Positioning for an eventual economic recovery
While this may seem premature to talk about, business that are survivors that make it through this recession by focusing their attention on consumer needs and core brands will be strongly positioned for happier days ahead. As we have seen n the past we have always recovered from these types of economic events and resumed a trendline after the event has past. However, companies must understand how people’s behavior may change going into, during and following the recession so they will be able to offer products and communicate messages aligned with the needs of new consumer segments.
However, the upcoming recession may be unusually severe, and consumer confidence and trust in business may hit record lows. There is a good possibility that consumer attitudes and behavior shaped during this recession will linger substantially beyond its end, even if by some miracle the coronavirus doesn’t wreck the havoc that people fear. By far the large majority of consumers—may well retain the self-distancing and consumption habits they have learned. They’ll seek value and trusted brands, remain cautious in their purchases of treats, and continue to delay purchases of postponables.
Businesses should prepare now for a possible long-term shift in consumers’ values and attitudes.
Need Help with Marketing During a Recession?
If you are worried about your business strategy during a recession or to get you through the Pandemic, we are more than happy to help you figure it out. I do recommend you contact us ASAP—I know you may have a lot on your plate but once the pandemic slows down and a potential longer term recession actually hits you are going to have a lot on your plate. Shore up your recession marketing strategy now so when the time arrives, you’re prepared.
Digital Marketing Agency
5904 Warner Ave
Huntington Beach, CA 92649
Phone (800) 451-7085