Recession-Proof Your Business And Survive The Economic Downturn
With the deep recession of 2008 still all too fresh in our minds, fears of another and perhaps even greater recession in the wake of the pandemic are rife. The Resolution Foundation recently published figures showing that the chances of a recession in the UK are at their highest since 2007. So, what can you do for your business to ensure that you are better equipped to brave the looming storm?
Understand Consumer Behaviour
A company’s ability to pre-empt customer behaviour and understand the business’s level of vulnerability during times of economic downturn is of utmost importance. If you are going to be able to react effectively to a change in customer behaviour during a recession, you will need to really understand how your business sits in terms of consumer priority when times are tough.
Is your product or service one that is likely to face the chopping block when people start cutting costs? Luxury products or activities, for example, will feel the strain more strongly. Subscription-based services may also suffer as people begin to tighten their belts. If your business falls into these categories, you will want to look at how you can offer them more bang for their buck, or perhaps think about tailoring your services to offer more affordable solutions.
On the flipside, if you are a business that offers budget products or services, you may see a rise in demand, and will want to ensure that you are prepared for a potential spike in orders and engagement.
Leverage Promotional Activity
Now would be a good time to start thinking about the potential offers that you could launch when it comes to the crunch. Your industry as a whole might see an overall slump in revenue, but if you can market yourself as a cost-efficient option within your industry, this will help you to pull in the consumers that have abandoned their usual, more expensive provider in search of something more affordable. A timely promotional offer could set you apart as a more compelling option when people inevitably start jumping ship!
Do be careful, however, not to devaluate your business or compromise your brand. These strategies are all about moderation, and it will be worth the competitor research and creative brainstorming to eventually find that sweet spot that draws people in without selling yourself out. You might want to think about attractive, short term offers that generate acute spikes in sales, rather than long-term promotions that could lead you toward a dependency on discounts.
Show Compassion
When a consumer starts to weigh up whether it is financially viable for them continue using your product or service, there will be more factors at play than just your price tag. People have a harder time parting with a company by which they feel valued and seen. From a marketing standpoint, it is therefore crucial that your message acknowledges and empathises with the trying times. A company that fails to put themselves in the shoes of its consumers during a recession, could soon be watching those very shoes running for the hills.
If a consumer feels that your business understands their circumstances and cares enough to respond, they will place more trust in you to remain relevant and accessible in an unstable market.
