Lately, every time you turn on the news, you hear the word “unprecedented.” The spread of the Covid pandemic is playing out at a speed and intensity not seen since the Spanish flu of 1918; the joblessness rate in America has risen to a level not seen since the Great Depression. Again and again, you will hear news anchors say that there is no way of knowing how an event like this will affect our modern, post-industrial, information-age economy, because the world has just changed too much since the most recent comparable events. You will hear that there’s no way of knowing how spending will be impacted when quarantines and stay-at-home orders end because there is simply not enough data. But that doesn’t mean you should make your business decisions blindly. Here are a few things to bear in mind as your market research shifts gears.
Don’t rely on what you already know
When the economy changes, so do a lot of consumer behaviors you might be taking for granted. Many of your regular customers have lost their jobs, or are afraid of losing their jobs, and are saving every penny they can. That means they’ll stop buying certain products altogether, and seek out deals on things they feel they can’t do without, abandoning old buying patterns. And as business’ revenues fall, they go through a similar round of price-cutting, causing sands to shift for B2B services as much as for B2C ones. You may remember this situation from your college Econ 101 class as “the paradox of thrift.”
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Spend less, but spend smarter
In times like these, businesses with an eye on the bottom line will dramatically cut their market research budgets. This is a dangerous game, because a lack of research can certainly lead to poor decision-making, but it’s also inevitable. As margins grow thinner, every department will have to make sacrifices. So think about how you’re spending your budget. Cut back on experimental, exploratory studies into underdeveloped market niches and focus on your core customers. Figure out who they are, how to serve them, and how to appeal to other people who are like them. Before you spend money on analysis, ask yourself whether you’re analyzing something you need to know or something you want to know. Try to build a data-driven culture with leaner margins.
Think about the rest of the world
Maybe this contradicts our last point a little, but if you do any business abroad, now might be the time to start researching opportunities around your foreign offices. This pandemic is going to have an economic impact on every country, but that doesn’t mean that impact will be the same in every country. Keep an eye on the news and see if you’re positioned to move into any markets that aren’t hurting as badly. Markets in developing countries provide unique opportunities, since any large corporations there will be fairly new, by definition. That means you can move into market niches in those countries without encountering the generations-old brand loyalties you might see in America.
Take lessons from the past
Yes, the Covid recession will be something new and different, but that’s no reason you can’t learn from past recessions. If your company was around during the Great Recession of ’08, what did it do then? Did it work? If it didn’t, and the company took a serious hit, what did your competitors do that put them in a better position? Institutional memory is part of your data set. Talk to anyone who was working for your company at the time and get their impressions. If your company is less than twelve years old, find a comparable company and look at how it survived the crash.
For more on how to rely on data in times of change, visit our website.