You already have data. You need insights. Where do you start? Experimental data is expensive and maybe unattainable or unethical. Observational data, on the contrary, is more accessible and affordable because it’s a result of business operations.
The pandemic-induced recession is recovering. A sure sign that the economy begins to rally after a significant decline and several economic parameters already indicate it. A rebalancing economy will find itself in the middle of disruption, failures, and innovation. But these signs are not the perfect harbingers to better times. Only time will tell whether we slip back into recession or carry on into the phase of recovery as in a double-dip recession.
Working backward from data to ‘the purpose’ of your business is the roundabout way. It takes costly resources. There’s no luxury to experiment with abundant resources in a recession. Neither are customer behaviors going to be very predictable.
Besides, there’s no telling exactly how consumers will emerge from a downturn. We know their value systems are changing, but we don’t know the exact incentives that will drive their next purchasing decisions.
Consumer behaviors are likely to keep fluctuating until we reach the next normal. Depending on the severity of the recession, we’ll see shifts in satisfaction, experiences, infrastructure, and demographics. Besides, health and hygiene concerns, businesses must rethink how and where they connect with consumers.
To quote Mark Ritson,
“All the words that have been said previously no longer fit the picture.”
The woke customer
Lazily expanding a business to more glamorous or sensational in-demand products or services doesn’t move this new woke customer. They’re going to be conservative in their spending habits, socially liberal, environmentally aware, and very rooted in their communities, digital or otherwise.
Nesting at home, customers prioritize community, relationships, and experiences over material wealth.
Brands with a pitch for inclusivity, diversity, and environmental sustainability have a guaranteed edge.
This is causing a surge in life online, the consumption of digital content, and the preference for digital entertainment. One’s home becomes a hub in itself. The new coffee shop. The place of entertainment. The dance floor. The restaurant. The movie theatre. The workplace.
Remote learning and spending on DIY education are on the rise. According to YouGov’s study, about 35% of Netflix subscribers use it for educational content.
There is no naive optimism in experts, drug manufacturers, healthcare institutions, doctors, and systemic invisible hands. Nobody has all the answers, and yet the whole is greater than the sum of its parts. With a priority on health, hygiene, fitness, and nutrition, the organic food supply chain, e-pharma, and e-fitness consultant are at large.
The gig economy, remote work, and creator culture are going to take the spotlight as employment fades into the background. There’s been a 20x rise in Zoom participants. Besides, that just accounts for one video conferencing service channel among other competitors.
There’s a surge in eCommerce and DTC brands with a larger basket and reduced frequency. An Oxford Economics study in partnership with McKinsey reports that personal income is not likely to recover pre-crisis level until Q2 of 2024.
Communication & Information
There’s a further migration to digital and a definite decline of in-person sampling or presence. Think eCommerce, telecommunications, digital communities, virtual events, and meetings.
Travel & Mobility
There’s going to be a reduction in tourist spend and tourist retail. This may, however, increase domestic travel and tourism.
The nature of doing business has changed at its core across every industry. Besides, people’s behaviors are changing in the hyper-digital era, new systems replace older ones, and people will emerge significantly different.
As businesses poise themselves for the next decade of renaissance, market trends, the logic of these trends, cognitive theories, cultural biases, legal rights, historical sanctions all come together under the same roof. A business with enough skin in the game is accountable to its community. With indomitable business models of course.
The question is:
Even when the newsflows shift with the next crisis, are you going to show your long-term commitment to your customer and their newfound ideals?