Back In Recession…By joanne | 26th April | Marketing Ideas, Marketing Training
It’s no wonder people are confused is it? On the same day, we had news articles telling us about the country falling back into recession alongside apparently conflicting articles showing consumer confidence is rising. So what is actually the case – and more importantly, what does it mean for your business?
The first thing to realise is that both articles are factually correct – based on the related research and statistics:
- A ‘recession’ is when the country shows negative growth for two three-month periods in a row. (A piece of information we didn’t know until the recession happened and now it seems even our pets have a grasp of this concept.)
- Consumer confidence is much more difficult to measure. And it’s based on a diverse range of factors including ‘perceived wealth’, the weather, an individual’s mood, people’s work situations, people’s family situations, the local high street and community activities, the local Council… the list is literally endless.
The word ‘perceived’ is one of the most important both in the context of the paragraph above and also in marketing as a whole. Perception is a very powerful thing… if we perceive we are better off, then we act that way. And the opposite is also true. So you have a number of people who have benefited from the recession through decreased mortgage payments, but they perceive the country to be at risk, so they save that extra money instead of spending it (as they would have done prior to the recession).
Unfortunately for the UK, the same thing is happening at a country level, caused by the knock-on effect of the so-called ‘European Debt Crisis’. Countries outside Europe ‘perceive’ Europe to be a risk at the moment, so they may choose to do their investing elsewhere. If they do invest here, they expect higher returns for the ‘perceived’ risk. Simples!
But what does all this jargon and hyperbole mean for your business?
Well.. it depends how your customers perceive themselves and their position. If they are busy / wealthy, they probably feel OK and are willing to spend and invest their money. If they perceive they are doing poorly, they will be saving their money and cutting costs where possible. If you don’t know how your customers are feeling right now, you should perhaps be trying to find out.
Good luck – and shout if you need assistance.