Combine the recession fears with higher prices for food, gasoline and housing, and other necessities that pre-existing wages cannot meet.
There are economic Ph.D. experts, a lot smarter than me, who think that a recession could still be averted, but if we had one, it wouldn’t last as long as the 2008 one. Who knows?
So, I did a little digging to see how these “recession perceptions” might affect consumer spending.
HUB SPOT, a consumer research and marketing firm, asked some questions in the summer of 2022 and followed it up in the winter of ’22.
Here Are Some of Their Findings:
- 30% of consumers were spending less, and 11% were trying to avoid spending altogether. Only 17% said the news of a potential recession hadn’t affected their spending one iota.
- When the same question was asked in the winter of 2022, the 30% of respondents who said they were spending less remained consistent, but those who said, in the earlier study, that the recession might impact their spending (13%) increased to 20%, almost a 50% increase!!!
- When asked if a “recession” is declared, how will your home budget change in the first three months? Here are their answers. 30%, it would decrease significantly. 34% would reduce somewhat. That’s 2 out of 3 households planning to decrease their home budget. 1 out of 10 said it would moderately or significantly increase. Only 23% said it would stay the same.
- HUB Spot also asked consumers to reflect on their purchasing behavior during uncertain times. No surprise here. Essential groceries and food; rent, mortgage, housing, bills. Essential personal care products, medication, and healthcare.
- The least amount they spent was travel and experiences such as baseball games, movies, and Broadway shows. (I imagine that bowling as a discretionary dollar of entertainment would also fit in this category)
- The news is okay. 10% would still go to the movies, a baseball game, or, I suspect, bowling.
Here Are A Few Takeaways to Keep in Mind.
As marketers, we are not experts in financial markets and should not be seen as a source for investment, HR, and legal advice. And no one knows for sure if or when there will be a recession.
Please keep in mind that while the results above can help you navigate how to market your center, they’re just a portion of one small survey and a brief look into the eyes of consumers. Before making any significant decisions about your marketing spend, or business, you should research, analyze multiple data points, and consult experts in your industry.
While your decisions should be based on a deep dive into data, the survey results above show that marketers should be cautious about how their efforts need to pivot with changing consumer needs or trends.
- A recession today might not be the same as 2008. While consumers likely will tighten budgets and look for products that offer the most value or necessity for their dollar, they might not be in dangerous financial conditions. They could still be persuaded to buy a great product that is marketed to them in the coming months, like your center’s bowling experience, but you have to do it right
- Market your product’s affordability, value, and necessity: As consumers and businesses tighten their budgets, making sales, retaining customers, and persuading people to buy non-essential products will be more difficult. Even though it has long been said that bowling is recession-proof, make sure you are marketing that your product has added value or importance other than being flashy, trendy, or cool.
- As a marketer, you might want to explore more cost-effective strategies. (Think of reducing excess ad spend and focusing on organic social, SEO, or email marketing instead.)
Remember, financial uncertainties – and even recessions – are standard. And while it might become more challenging to win customers in the coming months, businesses and consumers will keep moving (and making purchases) even as we wait for the cycle to run its course.
And remember, the kaploe group has the expertise to help you make the good times even better and the bad times much less harmful.