Recent commentary on the July retail sales report universally implied a difficult peak shopping season ahead. To be fair, July retail sales fell below expectations after better-than-expected months in May and June, and consumers’ outlook on the future (as measured by the Consumer Confidence Board’s Expectations Index, which measures consumers’ short-term outlook for income, business, and labor market conditions) declined significantly, as well.
This got us thinking about what other “events” loom on the remaining 2020 horizon that might impact consumer spending through the balance of the year. Here are a few that we’re sure are top of mind for many:
Looking at that list, there seem to be more potential headwinds than tailwinds for consumer spending through the balance of year… so the question becomes, “what do you do about these headwinds?”
Consider the following framework that plots these influencers on spending in terms of the ability to control and plan around the possible outcomes:
Notice the absence of consumer spending factors that fall into the top half of the chart. Similarly, good precedent and insight around the impact of these variables – and therefore the ways one might plan/mitigate – are only apparent in the case of the November presidential election.
Given that there is no ability to control these factors, and very limited ability to plan around them, don’t be distracted by the possibilities. Rather, focus on the elements that can be controlled and develop the most effective plan to drive customer engagement over the coming months:
- Know your customers and what’s important/relevant to them given the factors outlined above
- Tailor your product development and customer experience efforts to deliver on those needs
- Create compelling offers to mitigate the potential timing of these events
- Continue to explore new, diverse paths to market (e.g. partnerships, multi-channel) to mitigate potential effects of COVID-19
- Review your marketing and messaging strategies to ensure they’re contextually relevant and give you continued permission to drive interest and awareness given COVID-19
And think critically about your plans for next year. Given the turbulence of 2020, that will be a challenge in and of itself.us