Stability Wins in a Recession While Panic Destroys Brands
Fear is the driving force during recessionary periods. Stability is the antidote. Brands that express stability while showing they can be nimble enough to adapt to a changing landscape maintain the trust of stakeholders across the spectrum, from suppliers and employees to consumers and investors.
As other stakeholders look first to consumer behavior to assess company stability, C-suite executives who can show their brand understands and can swiftly adapt to changing consumer motivations during a downturn signal stability. Outwardly aligning sales and marketing strategies to address consumers' new way of viewing goods and services projects confidence and expertise in a way that hesitation can’t.
Consumers reorient their buying behavior, during a downturn, reclassifying goods and services into essentials, treats, postponables, and expendables. Their lack of confidence about their future, their income, and the economy leads to greater scrutiny and less trust in brands – perhaps more so this time around with the current political environment.
C-suite executives who can position their brand into an essential or reorient as a treat, without sacrificing their value proposition, can weather or even grow in a recessionary environment. Too often though, brands fail to adapt or dilute their positioning with discounting that spirals into a price war.
Trust is maintained by consistency. Stakeholders are reassured by messaging that adapts but stays consistent with the brand’s core values. In an overwhelming media environment replete with bad news, people seek the familiar for a sense of stability. A brand that projects confidence in its product or service and in its brand value is naturally attractive to a population looking for something they can trust.
It's easy for brands to react in a crisis with off-brand or tone-deaf messaging. Communications professionals know that observing the core tenets of effective crisis communications, promptness, transparency, empathy, and consistency will produce a better result. This holds true whether the crisis is brand or industry-specific – or global in nature.
In 2010, at Avocados from Mexico, our new GTM team faced building a market in the midst of the last recession. An understanding of the economic environment and empathizing with budget-constrained consumers drove our messaging as an everyday treat. Pairing the unfamiliar with traditional American dishes simultaneously positioned avocados as an essential and a treat, exactly addressing the common struggle during recessionary times of staying on a budget without deprivation. Doubling share and growing sales by 400% before finally emerging from the recession proved the strategy worked.
Consistency builds trust, and during a recession, familiarity breeds attraction. Messaging that stays the course while acknowledging a new reality reassures stakeholders across the spectrum, building trust and even strengthening brand value. Through consistent messaging, C-suite executives can enjoy consistent sales and position a brand to capitalize on growth opportunities when the economy inevitably turns upward again.
