Shoppers are deciding to keep more of their money in their pockets and spend less of it with businesses. At the same time, businesses are cutting back on spending and inflation is rising. In the USA retail spending went down last month, in spite of predictions from economists that it would rise. In the UK, interest rates went up to a six-year high of 5.5% in a bid to control the growing inflation in Britain. Add to this the news that two major businesses are making huge redundancies – Barclays Bank is cutting 1,100 jobs and Britain’s second largest biscuit producer, Burtons, is axing 650 jobs. The economic picture is not looking good. On top of this, consumer debt is at an all time high and we appear to be at that “tipping point” where people are about to stop buying things with the frenzy that’s been around for the past five years or so.
The problem for Internet marketers is that their sales have all been made in the period of consumer happiness – when people were not worried about job losses, interest rates, or their credit card debt. Now we have a combination of factors which are just starting to kick in which will inevitably mean less online shopping. And that is going to hit Internet marketers very hard.
So how can you survive any impending downturn in online shopping? How can you protect your business against any reduction in consumer or business spending? How can you maintain or even improve your revenue. The answer to these questions is to look back at times of severe financial hardship, recessions, and see which kinds of businesses survived and thrived in those difficult times.
What you will discover is that the businesses that survived and did well were those that had two things: a community of customers and good relationships with them. In other words the best thing you can do to protect yourself against any economic downturn is to stop trying to sell your stuff; instead work on those relationships with your customers and potential clients. That’s the best protection you can have because these people will not want to leave you, even if times are tough. If they don’t have a relationship with you, they will not feel guilty at abandoning you in tough times. If they do have a good, solid relationship with your business and feel part of your community of customers, they will find it a tough, emotional decision to give up using you and shopping with you.