We are big fans of APM Marketplace, the daily economics podcast hosted by Kai Ryssdal that provides a macro and micro vision of the global economy and economic indicators, looking at real-life impacts for everyday people, something essential for small businesses with a current unemployment rate in double digits. They have a great joint project conducted with Edison Research, the Marketplace-Edison Research Poll, started in 2015 and that looks at how Americans look at their financial situation.
The main indicator from this work is the Economic Anxiety Index, and this number raised 25% in a 12-month period, according to the latest data from May 2020. Of course, this shows the influence of the COVID-19 pandemic on the pockets of many people who have lost their jobs or are afraid their employers will make further cuts.
One of the most telling numbers of this report is the fact that 59% of Americans don’t have enough savings to pay an unexpected expense of $1,000. That is the main definition of living paycheck to paycheck. So, in addition to the more than 30 million people who filed for unemployment, even those who maintained their jobs couldn’t pay for a medical treatment if they fell victims to the disease, and that is what increases their anxiety about their financial future, especially in the short term.
And it is this scenario of limited consumer disposable income that small businesses must face to increase their sales. When more than half of potential consumers are afraid of not being able to pay their mortgage or rent, how do you convince them to spend on your restaurant or specialty store? Here are some strategies that you can use.
Almost everybody is feeling the impact of the pandemic. Even if you live in an area that wasn’t hardly hit by the virus or you work in an area that hasn’t suffered with social distancing and quarantine rules, you understand that this is a lifechanging event and people are more concerned about their safety and future.
Looking at this outlook with a marketing perspective, small business can connect to their consumers as part of their community, as an entity that is ready to listen to their pains, provide them some joy and serve their needs. Think about these premises when you create your social media content, talk directly to your potential customers, and redesign your services focused on current concerns. For example, if you are a small restaurant owner, you can post a video that shows all the safety procedures you’re using in the kitchen and packaging to ensure viewers that you care about their health and wellbeing.
Sense of Urgency
This is an old trick, but it usually works. Especially if you have high inventory levels of certain products, you can build a strategy of quick sales that end in 12 or 24 hours to take advantage of FOMO. Regardless of their financial situation, sometimes people just cannot resist an opportunity purchase if they believe they shouldn’t miss a great deal, representing a great way to access consumer disposable income.
As part of your social media marketing strategy, remember your posts won’t show on your potential consumer’s timeline right away; therefore, match the promotion period with the usual time your followers take to interact with your posts. Thus, you ensure sense of urgency doesn’t turn into disappointment.
A crisis is a time where people help each other, as they understand that there is always someone in a worse situation than you. We’ve seen many examples such as craft breweries producing hand sanitizer and luxury clothing brands making masks and donating these products or redirecting the funds from sales to charity.
Small businesses have the advantage of proximity, of being part of a tight community. In addition to the obvious benefits of doing what is right for this community, charity actions that benefit your neighbors are a great way to reinforce the presence of your business and strengthen the brand. Giving the opportunity for people to participate in these actions can have a huge effect on customer loyalty. They will remember this when we get back to a “new” normal economy.
The number: 59%
The Action: Social media engagement is a great way to connect to people, so use your corporate accounts to conduct these strategies that we suggested and get closer to your community. Regardless of the amount they can spend now, customers will remember emotionally about these times. Thus, a positive image of your company right now will have a long-lasting effect.