The Delaney Report (2.18.2008) featured a great article on consumer reaction to economic troubles. Here are a few excerpts from the article:
"The economy is decelerating (in the U.S. at a faster pace than elsewhere). Companies are continuing to reduce costs. Inventory is building up. Shipments are falling. But it's the consumer that is causing the greatest anxiety among marketers this year. In the past, consumers could be relied on to bolster a sagging economy. Consumers who were unafraid to spend and had easy credit at their disposal. But consumers now are anxious and cautious. Last week, a consumer-confidence survey reported that consumer confidence was at a 14-year low."
"Marketers, as a result, are under more pressure than ever before to find growth. A sports analogy might be useful. Just as sports fans want to be associated with teams that are winners, consumers want to be associated with "winning brands". Brands that will make them feel better about themselves. Give them a reason to smile. But marketing a "winner" brand takes work.
"Find the one thing that you differentiate the brand with and don't waver from it or the consumers will get confused. And then find a way to reach your audience in the most efficient way possible."